A Guarantee Agreement for World Bank (IBRD) lending of US$ 650 million to the Dedicated Freight Corridor Corporation of India Ltd. (DFCCIL) for Eastern Dedicated Freight Corridor-III (EDFC-III) Project has been signed between the Government of India and the World Bank in the national capital. This Agreement was signed by Shri Raj Kumar, Joint Secretary (MI), Department of Economic Affairs, Ministry of Finance on behalf of the Government of India and Mr. Hisham Abdo, Acting Country Director, World Bank, India on behalf of the World Bank.

The objective of the EDFC-III Project is to augment rail transport capacity, improve service quality and enhance freight carriage throughput on the 401 km Ludhiana-Khurja section of the Eastern Dedicated Freight Corridor; and develop institutional capacity of DFCCIL to build, maintain and operate the entire DFC network. This project is in continuation of Phase-I and II of the EDFC Projects being implemented by the DFCCIL with the World Bank loan of US$ 975 million and US$ 1100 million respectively on the Dadri-Khurja-Kanpur; and Kanpur-Mughal Sarai stretches of the Eastern Rail Corridor (Ludhiana-Delhi-Kolkata). The project will directly benefit the power and heavy manufacturing industries of Northern and Eastern India, which rely on railway network for transportation of their material inputs and also for the distribution of bulk processed and semi-processed commodities and consumer goods. Railway passengers will also be benefitted through decongestion of the existing passenger lines.

Guarantee agreement facilitates World Bank direct lending to DFCCIL for Eastern Dedicated Freight Corridor to augment freight capacity. A Guarantee Agreement between the Government of India and the World Bank enables World Bank direct lending to DFCCIL for the Eastern Dedicated Freight Corridor-III project, securing financing for works on the Ludhiana-Khurja section and continuing prior phases of World Bank-supported lending. The agreement facilitates sovereign-guaranteed project finance to augment freight capacity, improve service quality, enhance throughput on the 401 km corridor, and support DFCCIL institutional capacity building to build, maintain and operate the corridor network.