Muutused Valga linnas pärast Eesti-Läti piiri määramist
but totally changed the situation in rail traffic. Railway network that was built up on age of
Russian empire was developed for its needs, but wasn't appropriate for new situation. After
33
confirmation of Estonian-Latvian border, Latvia got a part of narrow-gauge railway Valga-
Mõniste. From Valga-Mõisaküla railway almost 90% was lost to Latvians. Railway
Convention signed June of 1921st between Estonia and Latvia had provided a basis
restoration of train service on these lines, but it cost a lot of for Estonian state and the
Estonians. To save costs and reduce inconveniences the new 15-kilometer railway section
was built from Valga to Koikküla on year 1923. By using new railway line through
Kaagjärve, traveling from Valga to Mõniste without passing Latvia, was possible.
The biggest factor for local economic was the impact of customs frontier and smuggling.