The Russian Direct Investment Fund (RDIF) and Japan Bank for International Cooperation (JBIC) will ste up a joint investment fund with assets totalling at $1 billion, RDIF’s CEO Kirill Dmitriyev said on Friday.

“Today we signed a very important document… on setting up a joint Russian-Japanese (investment) fund with JBIC worth $1 billion. RDIF will not have a controlling stake, but we will invest a sum close to half (of all assets). Thisfund will play a key role in financing joint Russian-Japanese investment projects,” Dmitriyev told reporters at the Russian-Japanese business forum in Tokyo.

In 2017, the joint fund will finance the first five projects, he noted. “We are currently discussing over 20 projects, part of which we hope to implement in the first six months,” Dmitriyev said.

RDIF will hold a 49% stake in the fund against JBIC’s 51% stake, and the volume of investment will be proportionate to stakes, he added. The joint fund will invest in projects in the agricultural, infrastructure and other spheres. “The fund is a very important step because $1 billion invested by the sides will allow to attract up to $10 billion to Russian economy, to joint Russian-Japanese projects as leading Japanese companies and Japanese banks will cooperate with the fund and finance joint projects,” Dmitriyev said.

The investment fund will also seek to involve leading Japanese companies, like Mitsubishi, in production in Russia because they are interested in localization, he noted.

Russia’s port assets

The Russian-Japanese investment fund will consider investing in Russia’s port assets, Dmitriyev went on.

“Japan is also interested in investing in several (Russian) ports. We are considering such projects with them,” Dmitriyev said.┬áThe port of Novorossyisk remains an interesting port asset.

Railroad between Russia and Japan

The first stage of the potential project of linking Russia and Japan by railroad will approximately cost 400 billion ruble, RZD Vice President Vyachesalv Pavlovsky said.

“We estimated how much the project of constructing a railroad between the continent and Sakhalin will cost. Around 400 billion rubles,” Pavlovsky said.

Talking about the second stage that will include linking Sakhalin and Hokkaido, he noted that “complicated and difficulr work will have to be carried out to update the feasibility study.” “We think that the synergy effect from constructing a permanent crossing between Sakhalin and Hokkaido will be considerable,” he added.