To expand sustainable, safe and inclusive urban mobility in Baku by extending the Green Line, supporting climate goals and catalyzing regeneration in post-industrial districts.
The Baku Metro Expansion Project - Phase II (Green Line) (the “Project”) includes the construction of approximately 8 kilometers (km) of twin bore, dual direction tunnels using Tunnel Boring Machines (TBMs), together with the completion of four underground stations. The Project includes three main components:
The Project builds on the institutional capacity, governance organization and physical investments under Baku Metro Expansion Project – Phase I, which was prepared in 2025 and approved in February 2026. It constitutes a key phase of the Government of Azerbaijan’s broader USD2.455 billion Baku Metro Expansion Project (the “Program”), a high-priority multi-phase initiative of the Republic of Azerbaijan aimed at enhancing sustainable urban mobility in Baku.
The full scope of the government’s Program includes the completion of the Darnagul and Khojasan Depots (Baku Metro Expansion Project - Phase I), Green Line extension (the Project), the digitalization component (Baku Metro Signaling Modernization and Operations Digitalization Project) financed by the Asian Development Bank (ADB), the parallel ADB-financed expansion of the Purple Line and the rolling stock renewal (Phase III).
Applicable Policy and Categorization: AIIB's Environmental and Social Framework (ESF, 2024), comprising its Environmental and Social Policy (ESP), Environmental and Social Standards (ESSs), and Environmental and Social Exclusion List, applies to the Project. The Project triggers ESS 1 (Environmental and Social Assessment and Management) and ESS 2 (Land Acquisition and Involuntary Resettlement). ESS 3 (Indigenous Peoples) is not applicable, as there are no Indigenous Peoples or ethnic groups present in, or with a collective attachment to, the Project area. The Project has been classified as Category A under AIIB's ESP based on the nature, scale and complexity of the activities. The Project involves large-scale underground construction in a densely populated urban corridor, including approximately 7.4 km of twin-bore TBM tunnels, four underground stations, and deep excavations in areas with legacy industrial contamination.
Environmental and Social Instruments: A comprehensive draft Environmental and Social Impact Assessment (ESIA) has been conducted to assess the environmental and social (ES) risks and impacts of the Project, together with an Environmental and Social Action Plan (ESAP). As part of the ESIA and ESMP package, the following eight ES management plans have been prepared: (i) Land Acquisition and Resettlement Plan (LARP); (ii) Cultural Heritage Management Plan (CHMP); (iii) Community Health and Safety Plan (CHSP); (iv) Occupational Health and Safety Plan (OHSP); (v) Waste Management Plan; (vi) Spoil Disposal Management Plan (SDMP); (vii) Contaminated Land Assessment and Management Plan (CLAMP); and (viii) Labor Management Plan (LMP). In accordance with the ESAP and ESMP, the Contractor will be required to develop and implement site-specific plans prior to construction, including an Air Quality Management Plan (AQMP), Noise and Vibration Management Plan (NVMP), Water and Wastewater Management Plan (WWMP), Emergency Preparedness and Response Plan (EPRP), Worker Accommodation Plan (WAP), and Asbestos Management Plan (AMP).
Environmental Aspects: The Project is expected to generate significant long-term environmental benefits through expansion of high-capacity public transport, reduced road congestion, and lower transport-related GHG emissions. However, the construction phase presents several environmental risks due to the Project's location within a dense urban environment and the historical industrial legacy of the corridor. Key construction-related environmental risks include: (i) contaminated land and soil - the corridor traverses a historically industrial area, with legacy contamination at stations Y-15 and Y-16; (ii) air quality - construction activities will generate fugitive dust and exhaust emissions; (iii) noise and vibration - baseline noise levels exceed IFC daytime limits at all measured locations, with predicted major impacts at the Y-16 and Y-17 station clusters; (iv) ground settlement and structural integrity -tunneling and deep excavation will cause localized ground settlement, with structures identified requiring detailed evaluation; (v) water and wastewater - dewatering during construction will yield saline and contaminated groundwater requiring on-site treatment before discharge; and (vi) spoil and waste - the Project will generate a large volume of excavation spoil requiring segregation, class-based disposal pathways, and chain-of-custody controls. The ESIA confirmed that the Project does not intersect any Critical Habitats, as the corridor is within an urbanized area. Operational impacts are expected to relate mainly to noise and vibration, flash flood ingress, thermal stress and energy demand (requiring cooling capacity headroom), and waste management.
Social and Gender Aspects: The Project is expected to generate substantial social benefits through improved accessibility, reduced travel times, enhanced connectivity, increased transport safety, and improved access to employment, education, healthcare, and social services. Potential adverse social impacts include: (a) land acquisition and economic displacement, including permanent land acquisition for station entrances and temporary disruption to small businesses and vendors, which will be addressed through a Land Acquisition and Resettlement Plan (LARP) defining eligibility, compensation, and livelihood restoration measures; (b) community health and safety risks associated with construction activities in densely populated urban areas, to be managed through traffic management measures, construction safety controls, and community communication programs; (c) stakeholder concerns and grievances requiring proactive engagement, continuous consultation, and transparent information disclosure; and (d) gender-related risks associated with land acquisition, livelihood disruption, labor influx, and temporary restrictions on accessibility and mobility during construction, which will be addressed through a gender assessment and implementation of a Gender Action Plan (GAP).
Occupational Health and Safety (OHS), Labor and Working Conditions: The Project involves high-risk underground construction activities including tunneling, deep excavation, confined workspace, heavy lifting, and installation of electrical and signaling systems. Key OHS risks include tunnel instability, water ingress, and emergency evacuation challenges; heavy machinery and lifting operations; electrical hazards; exposure to dust, noise, vibration, and potentially contaminated materials; and traffic-related risks during construction material and spoil transport. The ESMP, OHSP, CHSP, and LMP have been prepared to include specific mitigation and management measures consistent with national and AIIB requirements, as well as Good International Industry Practice (GIIP). The Contractor will provide appropriate protective measures for each type of work and site condition. Given the high OHS and CHS risks, an EPRP is required, covering various likely scenarios including tunnel collapse, fire (including TBM-related fires), contaminated gas release, and other situations. A separate, project-tagged Worker Grievance Redress Mechanism (GRM) has been prepared.
Stakeholder Consultation and Information Disclosure: The SEP, updated as necessary, will guide stakeholder engagement throughout the Project preparation and implementation periods. Stakeholders include residents, business owners, municipal authorities, transport agencies, civil society organizations and metro users. Draft ES documentation will be disclosed in English and Azerbaijani on the Client's and AIIB's websites in a timely manner, at least 60 days prior to the Board’s consideration of Project approval.
Project Grievance Redress Mechanism (GRM): The GRM established under Phase I is already operational and will be used and updated, as necessary, for the Project prior to construction. The GRM will be accessible and transparent, include separate channels for community members and contracted workers, provide timely resolutions, and include confidential procedures for complaints related to sexual exploitation and abuse and sexual harassment. The GRM information will be publicly disclosed and widely disseminated. Baku Metro committed that dedicated staff will be assigned to manage the GRM functionally and effectively. The information about the project GRM and AIIB’s Project-affected People’s Mechanism (PPM) will be disclosed on Baku Metro's website and in hard copy at each phase area.
Monitoring and Reporting Arrangements: Project ES documents, including ESIA, ESMP, and ESAP, establish the monitoring and supervision framework for the Project. The PIU will oversee the finalization and implementation of the ES instruments and submit semi-annual ES monitoring reports, based on an agreed format, to Baku Metro, AIIB, and national authorities. Instrumental monitoring of noise, vibration, and air pollution will be required by the contractors. The Environmental and Social External Monitoring Consultant (EMC), as the third-party agency, will undertake periodic reviews of the performance, provide feedback, and commission biannual third-party validation. AIIB will also conduct implementation support and supervision missions to the project field twice a year.
Republic of Azerbaijan
Khadija Alizadeh
Head of External Debt Analysis Division
Agency for Managing Public Debt and Financial Obligations
