New Delhi: Indian Railway Finance Corporation (IRFC) has extended a substantial ₹9,821 crore rupee loan to the Dedicated Freight Corridor Corporation of India Ltd (DFCCIL) to refinance its existing foreign currency debt availed from the World Bank. The loan pertains to the Eastern Dedicated Freight Corridor (EDFC) project, one of India’s critical infrastructure initiatives aimed at modernizing and expanding the freight rail network.
The formal signing of the loan agreement took place at the Railway Board, New Delhi, with DFCCIL’s Director (Finance) Rahul Kapoor and IRFC’s Executive Director (Finance) Deepa Kotnis in attendance. The ceremony was also graced by Satish Kumar, Chairman & CEO, Railway Board, alongside senior officials from both IRFC and DFCCIL.
A Strategic Move in Infrastructure Financing
This rupee-denominated loan agreement marks a significant milestone in India’s infrastructure financing landscape, reflecting the maturity and capability of domestic financial institutions to fund long-gestation, large-scale projects. By refinancing existing World Bank loans with domestic currency funding, DFCCIL is expected to reduce its exposure to foreign exchange fluctuations, enhance financial stability, and achieve better cost efficiencies.
Manoj Kumar Dubey, Chairman & Managing Director of IRFC, stated, “This refinancing marks a landmark step in India’s infrastructure financing journey and reflects IRFC’s pivotal role in bringing financial efficiencies to the railway ecosystem.”
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Advantages of Domestic Currency Financing
The shift from foreign currency debt to rupee-denominated loans offers multiple benefits to DFCCIL:
- Reduced Exchange Rate Risk: Avoiding fluctuations in foreign currency reduces financial volatility.
- Financial Predictability: Repayment schedules in Indian rupees allow better planning of cash flows.
- Enhanced Funding Efficiency: Domestic financing streamlines the funding process, enabling quicker mobilization of resources.
Officials noted that such refinancing operations demonstrate India’s growing ability to fund critical infrastructure projects independently, supporting long-term economic growth and strengthening the country’s financial ecosystem.
About IRFC
Indian Railway Finance Corporation (IRFC) is the dedicated financing arm of Indian Railways, responsible for raising funds and providing financial solutions for railway projects across the country. Established to ensure efficient and timely funding, IRFC plays a crucial role in enabling large-scale projects like freight corridors, modern coaches, and infrastructure expansion.
About DFCCIL
Dedicated Freight Corridor Corporation of India Ltd (DFCCIL) is a public sector undertaking under the Ministry of Railways, tasked with planning, executing, and operating dedicated freight corridors across India. The organization is central to India’s efforts to modernize its freight transport system, improve logistics efficiency, and reduce congestion on conventional railway lines.
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