Officials told The Financial Express the announcement comes after meeting the Chinese government’s conditions, including handing 20% of the contract price and land for the Mawa to Bhanga section over to China Railway First Group (CRFG).

BR signed a $US 3.1bn commercial contract with CRFG in August 2016 under the government-to-government arrangement but a delay in signing the deal due to the fixation of the loan amount and interest rate delayed the project for nearly 20 months.

China will now cover 80% of the project cost under its preferential buyer's credit line, with 20% funded by the Bangladesh government.

The Taka 350bn ($US 4.1bn) project, due for completion by June 2022, will establish a 225km rail link with nine southern districts and connect Mongla and Benapole ports via the 6.15km under-construction Padma Bridge.

The route will be established in four sections: Dhaka - Gendaria, Gendaria - Mawa, Mawa - Bhanga junction via Padma Bridge and Bhanga - Jashore Bridge. The 50km phase from Mawa to Bhanga will be built first to enable the operation of trains over Padma Bridge on the day of its inauguration.