Latvia’s incoming government must decide whether the country can still afford to continue the Rail Baltica railway project as it prepares the next state budget, Transport Minister Rihards Kozlovskis said on Monday.

Kozlovskis told TV3’s *900 Seconds* that Russia’s war in Ukraine and broader geopolitical shifts mean Latvia can no longer implement the project as before. He cited uncertainty over future EU funding, a shortfall in current contractual commitments, and rising costs that make the financial burden on the state budget unpredictable. The government must now establish a clear expenditure plan for Rail Baltica, he said.

Lithuanian Transport Minister Juras Taminskas said the same day that Vilnius hoped a change of government in Latvia would help unblock the project, which has faced delays. “The Estonians are executing the project, and like us, they are keeping to the deadlines. We face more challenges with the Latvians,” Taminskas told reporters, adding that Lithuania remains committed to finishing its section by 2030 despite alleged construction violations by contractors.

The first phase of Rail Baltica in Latvia includes a cross-border connection from Lithuania to the Estonian border, work at Riga Airport, and the southern section of Riga Central Station. Latvia’s share of the first phase was estimated at €5.5 billion, but cost increases could push it to €6 billion. The total cost for the three Baltic states could reach €14.3 billion for the first phase and €23.8 billion if a second track is added.

Across the three countries, nearly half of the 870-kilometre European standard-gauge line is under construction or ready for construction. The project aims to link Tallinn, Panevėžys, Kaunas, Vilnius, Riga, and Warsaw with trains capable of 240 km/h. Two weeks ago, the leaders of Lithuania, Estonia, Latvia, and Poland urged the EU to ensure adequate funding for the project .