The loan is expected to cover 80 percent of the $15 billion project, and will be granted at an interest rate as low as one percent, provided India agrees to buy 30 percent of the required equipment, including coaches and locomotives, from Japan.

The project is expected to cut down travel times by up to five hours, with the train having a projected speed of between 300 to 350 km/h.

Indian Railway Board Chairman AK Mital said: “There are several (players) offering the high-speed technology. But technology and funding together, we only have one offer. That is the Japanese.”

This is seen as Japan’s answer to China’s recent high-speed rail contract in Indonesia. Japan is also partnered with Taiwan High Speed Rail in overseas high-speed rail markets amid protests from China.