Delhi & Tokyo may ink pact for India's first Bullet Train during Japanese PM Shinzo Abe's visit.

India and Japan are set to firm up an agreement on highspeed train services, widely referred to as 'Bullet Trains', during Japanese Prime Minister Shinzo Abe's visit next week.

Senior government sources told ET that Abe's Special Adviser Hiroto Izumi will be in Delhi this week for high-level talks to finalise the terms of the agreement on high-speed trains, known as Shinkansen in Japan. He will be negotiating the details with senior officials in the Prime Minister's Office (PMO) and the railway ministry. The first train is planned between Mumbai and Ahmedabad.

The project will cut travelling time between Mumbai and Ahmedabad from seven to two hours.

Further, Japan is likely to agree to finance the Rs. 90,000 crore-plus railway project through a soft loan at 0.5% interest with a repayment tenure of 50 years, according to the people cited. Usually, Japan offers this sort of project financing at 1.5% interest and a tenure not exceeding 25 years.

'The rate of interest and repayment time proposed by Japan are extremely attractive for India.

This has been possible only because of the push by the PMs of both the countries. We are hopeful this will also prompt other countries to go for lower interest rates for our infrastructure projects,' said a PMO official.

ET