The European Union is providing 82% of the funding for the project through the Connecting Europe Facility (CEF), with the remaining 18% funded by the Romanian government.
The project will upgrade the line to allow for a maximum speed of 160km/h for passenger services and 120km/h for freight services.
Rehabilitation works will be carried out on bridges, underpasses and tunnels while civil works will be carried out at several railway stations including signalling and electrical installations.
The project is the largest of seven for which CFR has obtained €1.13bn under the CEF.
