GE close to $263 mln Bosnia rail deal

BANJA LUKA, Bosnia May 9 (Reuters) - Bosnia's Serb Republic government said on Friday it is close to clinching a 170 million euro ($263 mln) deal with U.S. conglomerate General Electric (GE.N) to help it rebuild its devastated rail network.

"The contract could be signed in a month's time", the Prime Minister of the autonomous region, Milorad Dodik, told a news conference after a meeting with the company's officials.

Dodik said the project could start in September.

In the first phase of modernisation, GE would provide the equipment for the construction of a high-speed railway section connecting the northern towns of Doboj and Banja Luka with the northwestern town of Prijedor.

Bosnia's road and rail network, as well as much of its utility infrastructure, were destroyed in the 1992-95 war among its three ethnic groups -- Serbs, Muslims and Croats.

The Serb Republic government has picked Austrian builder Strabag (STRV.VI) to build a 3 billion euro highway network, the Serb region's largest post-war investment.

Bosnia's other half, the Muslim-Croat federation, is also looking into major infrastructure projects and could clinch a similar deal with GE soon. (Reporting by Mirna Soja; Writing by Maja Zuvela; Editing by David Cowell;)