The Interfax news agency quotes Georgian Economic Development Minister Giorgi Arveladze as saying the agreement was reached today in Tbilisi.
Such a rail link avoids Armenia, which lies between Turkey and Azerbaijan. Neither Turkey nor Azerbaijan have relations with Armenia due to their dispute over Nagorno-Karabakh, which is in Azerbaijan but is occupied by Armenians.
The new line is expected to be operational in two to three years.
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