The Paraguayan Chamber of Senators approved, in an extraordinary session last week, the bill amending Law No. 7,434/2025, known as the commuter train reform. The initiative, driven by the ruling Cartista faction, allows the project to be executed through a Government-to-Government (G2G) agreement with the United Arab Emirates, without the need to follow concession, Public-Private Partnership (PPP), and Public Procurement laws.
The approved text, which now goes to the Chamber of Deputies for analysis, establishes that the concession to Ferrocarriles del Paraguay SA (Fepasa) and the subconcession contracts will be governed exclusively by the new law and its regulatory decree. Law No. 1,618/2000 (Concessions), Law No. 7,452/2025 (PPP), and Law No. 7,021/2022 (Public Procurement) are expressly excluded, and may only be used supplementarily for interpretation.
Article 5 of the bill ratifies the preliminary agreement signed between the Paraguayan government — through the Ministry of Public Works and Communications (MOPC), the Ministry of Industry and Commerce (MIC), and Fepasa — with the company Etihad Rail PJSC, of the United Arab Emirates. The MOPC is authorized to sign the subconcession contract and the implementation contract with the Emirati company or with the entity it designates.
The text also allows that, within the scope of G2G agreements, the parties may agree on extension of jurisdiction, define applicable legislation, and resort to international arbitration, inside or outside the country, to resolve disputes. Technical or economic disputes may be submitted to specialized panels, binding or not.
In parallel, the MOPC confirmed that the first stage of the commuter train, between Asunción and Luque, has an estimated cost between US$ 400 million and US$ 450 million. This amount does not include the stretch to Ypacaraí, which is still in the definition phase and will require additional resources. The estimate contrasts with previous information from Fepasa, which indicated that the amount of up to US$ 450 million would cover the entire project, including the extension to Ypacaraí.
The discrepancy was pointed out by opposition lawmakers, who question the lack of clarity about the real scope of the project and the total cost, amid broader criticism about the transparency of the process and the exclusion of control mechanisms provided for in the concession, PPP, and procurement laws.