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The battle is over: Prime Minister Benjamin Netanyahu will be presenting the remains of his grand plan to upgrade Israel's transport systems tomorrow to the cabinet, which will convene for a special session.

Netanyahu's pared-down plan costs an estimated NIS 27.5 billion. The Prime Minister's Office had estimated the cost of the original plan, which had been formulated by Netanyahu adviser Uri Yogev, at around NIS 53 billion. That version, which included laying rail tracks from Eilat to Kiryat Shmona (among others) and building new roads, was shot down by treasury officials, who suspected the real cost would run to NIS 81 billion.

"The important thing is that for the first time, the State of Israel is planning a complex transport project from beginning to end," commented Yogev yesterday.

At a press conference yesterday to present the final plan, Netanyahu said Israel's infrastructure has remained backwards for decades, and it's time to modernize. "The roads are congested. That must stop," he said.

"We don't want three separate nations - the state of Tel Aviv, the state of Galilee and the state of the Negev. We want a single nation with equal opportunity for all," Netanyahu added, referring to Yogev's goal of boosting the economies of the so-called periphery, which for the plan's purpose meant almost everything outside the greater Tel Aviv area, through road and rail connections.

The Finance Ministry will lend its support to the plan, the prime minister vowed. Certainly, it didn't to the original plan, which treasury officials called "megalomaniac" and devoid of economic sense.

The purpose of the plan, said Transport Minister Yisrael Katz to the assembled reporters is to have 50% of Israel's population live in the north and south within 15 to 20 years, compared with 30% today.

Of the PMO's original plan, only half is left - a victory for the treasury. But the Finance Ministry is still not content, and objects to numerous details of the plans to be presented to the cabinet. In addition, other ministries will try to make changes in the plans.

The new program includes only eight major projects, spread out over a decade from 2010 to 2020. This year's budget includes only NIS 250 million for the plan, rising to NIS 1 billion next year, NIS 1.5 billion in 2012, NIS 2.5 billion in 2013 and NIS 3 billion in 2014. For the years from 2015 to 2010, the state will invest NIS 3.25 billion a year in the transportation projects.

The largest project is the NIS 8.2 billion electrification of major railway lines. The Valley train from Haifa to Beit She'an will cost an estimated NIS 3.4 billion, similar to the cost of the Acre-Carmiel train. New roads in the north will cost NIS 2.5 billion.

Road and train development in the south will be budgeted NIS 1.5 billion, based on priorities still not set, with another NIS 2.5 billion to be spent on planning and paying for expropriated land.

One of the most important facets of the plan is to allow trains on several routes to reach 220 kph, and roads will also be built to meet high construction standards. The treasury and national infrastructures ministries will examine the possibility of using private funding for part of the development of Road 6, the Trans-Israel Highway, in the north. A special authority within the Transportation Ministry will be established to handle the day-to-day management of the projects. Any budgets not used will be carried over to the following year.

Among the projects dropped from the plan are the train to Eilat, the eastern rail line from Lod to Hadera, and then on to Afula, and the extension of Road 6 to the Mashabei Sade Junction.