The Estonian government is once again increasing Rail Baltica's share capital by €4 million. This is part of the Rail Baltica budget that covers overhead costs and other items deemed ineligible for external funding.

Minister of Infrastructure Kuldar Leis (Reform) said this is a scheduled annual contribution agreed upon years ago. "Since most of the funding comes from Europe, Estonia's co-financing covers, for example, salaries and part of the design work," the minister explained.

According to Rail Baltica's own information, Estonia plans to carry out construction worth €686 million in 2027, but of that only €493 million has been secured to date. The Ministry of Climate will seek the missing amount during state budget negotiations at the beginning of autumn.

"Unfortunately, this is how our project works: budget decisions are made one year at a time," said Anvar Salomets, head of Rail Baltic Estonia.

"At the same time, it is not always sensible to lock everything in and decide it for a long period. The ball is in our court in this respect – we are refining the construction schedule and will provide the final input during August," he added.

Leis also said that funding is reviewed annually during the state budget process. "Every year, the state monitors the sums needed to maintain the pace of Rail Baltica's construction. Everything is under control in that respect," he said.

Most of the funding for Rail Baltica will continue to come from the European Union, while the Estonian state will review the amounts to be covered from the national budget.

The minister also clarified the timetable for the new EU funding round: "The plan is that the new European Union funding period will run from 2028 to 2034 – this is not only related to Rail Baltica but in general – so larger-scale European funding is planned from the year after next," Leis said.

"Rail Baltica is a priority for Estonia, so nothing in Estonia will be held back because of funding," he stressed.

Uncertainty in Latvia is causing concern

The situation with Estonia's southern neighbour is much less clear. The minister stressed that Estonia has been waiting for months for the Latvian government's official position on how it intends to proceed with Rail Baltica's construction and whether Latvia wants to make any changes to its plans.

Latvia's official proposal would then need to be discussed between Estonia, Latvia and Lithuania, as well as negotiated with the European Commission, Leis said.

"Since all of us have so far committed to completing the project by 2030, if any country wants to change that, it must be discussed among ourselves and with the European Commission," the minister noted.

Leis said no specific date has been set for receiving Latvia's response, and Estonia has no idea when it might arrive. There had been talk of a decision in August, but now September is being mentioned instead.

"Estonia is continuing its work, because it is possible to complete the route here by 2030," the minister said.

At the same time, Leis admitted that information on possible changes has long been expected from Latvia, and discussions in the media alone do not constitute an official change.

"My own hope was that following the change of government in Latvia – considering that the new prime minister is the former head of the Rail Baltica parliamentary inquiry group and that this is his priority, or that he himself is leading the project – their vision would emerge quickly. But unfortunately that has not happened," the minister acknowledged.

Salomets said that day-to-day communication with colleagues in Latvia and Lithuania is ongoing.

"In terms of project management, we communicate with our Latvian colleagues every day. However, an official position is unfortunately a matter for the governments, and as far as I know Latvia has not officially announced a new deadline, nor have they said when they will do so. At present, the owner's guidelines applicable to RB Estonia set the deadline as December 2030. We are planning our construction schedules accordingly," Salomets said.

Asked if he was concerned by the Latvian government's delay, Salomets replied that it certainly did. "After all, this is one integrated project," he said.

In June, Matiss Paegle, chairman of the supervisory board of RB Rail AS, the joint venture of the three Rail Baltica countries, wrote on social media that there was no chance whatsoever of Latvia completing the Rail Baltica route by 2030.

"Since December 2024, when the government endorsed implementation of the project's first phase, virtually nothing has happened. Given the current decision-making capacity, completing Rail Baltica by 2030 is not even theoretically possible. Every day without decisions extends the deadlines and makes the project more expensive – by approximately €200 million per year," he wrote at the time.

Paegle said Latvia could decide to restart the project and set a new, more realistic completion deadline, such as 2035.

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