A press statement by the Indian High Commission said the agreement is backed by a Government of India line of credit for USD 185 million. It is part of a larger package of assistance directed at the rehabilitation of railway infrastructure in the Northern Province of Sri Lanka, for which India has committed a total amount of USD 425 million in lines of credit, it said.

The latest agreement follows similar agreements that have been signed earlier for the rehabilitation of the Southern Railway corridor, which had been extensively damaged in the 2004 tsunami.

Under that agreement, India is assisting in the rehabilitation of the Colombo-Matara rail link through a line of credit of USD 167.4 million. Work on the Colombo-Kalutara sector of this line is already at an advanced stage.