A consortium of Hungarian and Chinese firms have secured a nearly $2.1bn contract to build and upgrade a section of Budapest-Belgrade rail line.

The contract was won by CRE Consortium, 50% of which is owned by RM International, a unit of Hungary’s Opus Global.

The remaining 50% of the consortium held by China Tiejiuju Engineering & Construction and China Railway Electrification Engineering Group (Hungary), representing China’s state railways company.

The scope of the project includes building the 150km-long Hungarian stretch of a rail link between Budapest and Belgrade.

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According to a Reuters report, the overall project includes upgrading the existing rail line and construction of the new line.

As part of China’s One Belt, One Road initiative, the line will serve as a key freight link once complete. It will transport Chinese goods that arrive at the Greek port of Piraeus to various other places in Europe.

The rail line is expected to reduce travel time between Budapest and Belgrade from th eight hours to less than four hours.

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A contract with the consortium is conditional upon China’s Eximbank providing the necessary funding for the project. Construction work will commence after the signing of the financing agreement and is expected to take five years to complete.

The Hungarian Government will finance 85% of the project with an Eximbank loan, while the remaining 15% will be procured from its own resources.

The government has already submitted a loan application for the project.