MANILA, May 22 (Xinhua) -- The Asian Development Bank (ADB) announced on Wednesday that it has signed an agreement to provide 750 million U.S. dollars equivalent in Indian rupees in long-term financing to fund a railway track electrification project in India.
The financing to Indian Railway Finance Corporation (IRFC) will be used to fund the Railways Track Electrification Project, as part of a broad modernization program that will help India's railway sector transition to electric power and away from dependence on fossil fuels, the Manila-based bank said.
ADB said the financing is the largest single non-sovereign loan ever committed by the bank.
IRFC, an entity owned by the Indian government, will use the proceeds from the loan to install electric traction equipment along approximately 3,378 km of existing railway lines, which will enable the migration of passenger and freight traffic from diesel to electric traction, ADB said.
It added the electrification assets will be leased to Indian Railways, the country's national railway system, under a long-term lease agreement.
"This is a flagship project demonstrating ADB's strategy of supporting key state-owned enterprises in strategic sectors," ADB Vice-President for Private Sector Operations and Public-Private Partnerships Diwakar Gupta said.
IRFC was set up in 1986 as the financing arm of Indian Railways for mobilizing funds from domestic and international capital markets. It is fully owned by the government and is registered as a non-banking finance company.
