ALMATY/Oct. 23 (The Bulletin) — Kazakhstan’s national railway company Temir Zholy has cancelled an order for several carriages from the Tulpar-Talgo plant in Nur-Sultan because the low value of the tenge has made the imported parts needed to make them too expensive, an industry website reported.
Cancelling the deal, worth an undisclosed amount, is perhaps the clearest evidence yet that rising inflation and the low value of the tenge, which is bouncing around historic lows of 390/$1, is hurting Kazakh industry.
The Railway Gazette International quoted a source at Spanish train manufacturer Talgo as saying that the company would no longer supply parts to the Kazakh plant but would still maintain Kazakhstan’s trains.
The plant was set up in 2011 and has the capacity to produce 150 railway carriages per year. It is often held up as one of Kazakhstan’s top manufacturing site.
The plant doesn’t produce any parts on-site but, instead, imports the various parts and assembles the carriages.
The Kazakh government bought most of Talgo’s share in the plant and had agreed to sell a stake of 99.99% in the plant to Russia’s Transmashholding in October 2018 for 23m euros. This deal was cancelled in February 2019.
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— This story was first published in issue 426 of the weekly Central Asia & South Caucasus Bulletin