NEW DELHI (Metro Rail News): Indian Railway Finance Corporation has signed a loan agreement with a consortium comprising Sumitomo Mitsui Banking Corporation, GIFT City Branch, and MUFG Bank Ltd, GIFT City Branch, to raise an External Commercial Borrowing of JPY-equivalent USD 400 million.
The loan is for five years and is unsecured, which means IRFC did not have to provide any specific assets as collateral to get the loan. The interest rate on this loan is linked to TONAR (Tokyo Overnight Average Rate) which is a benchmark interest rate in Japan. So, the cost of borrowing will move based on this Japanese market rate.
The loan agreement reflected that international lenders have strong trust and confidence in IRFC’s financial strength and its long-term plan to fund railway infrastructure projects.
The agreement was executed in New Delhi on February 25, 2026, and disclosed under Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. This transaction follows IRFC’s successful re-entry into the ECB market in December 2025, when the company raised JPY-equivalent USD 300 million from overseas markets.
Transaction Overview
| Facility Amount | JPY-equivalent USD 400 million |
| Tenure | 5 years |
| Benchmark Rate | Overnight TONAR (Tokyo Overnight Average Rate) |
| Security | Unsecured facility |
| Lenders | Sumitomo Mitsui Banking Corporation (GIFT City Branch) and MUFG Bank Ltd (GIFT City Branch) |
| Agreement Date | February 25, 2026 |
| Previous ECB (FY26) | JPY-equivalent USD 300 million (December 2025) |
| Regulatory Disclosure | SEBI Regulation 30 (Listing Obligations and Disclosure Requirements) Regulations, 2015 |
Loan Agreement Signing
The loan agreement was formally signed by Nav Goel, General Manager (Finance) of IRFC, along with Manoj Kaushik, Executive Director of SMBC, and Parul Shah, Head IBU of MUFG Bank.
Strategic Rationale
Speaking on the occasion, Shri Manoj Kumar Dubey, Chairman and Managing Director & CEO of IRFC, highlighted the strategic importance of diversified funding sources for the corporation. “Following IRFC’s successful re-entry into the ECB market in December 2025, this JPY-equivalent USD 400 million ECB further reinforces investor confidence in IRFC’s strong financial fundamentals and strategic vision,” he stated.
The CMD noted that accessing competitive global financing remains crucial as Indian Railways continues to expand network capacity, upgrade rolling stock, and enhance logistics efficiency. The diversification of funding sources ensures IRFC can meet the substantial capital requirements of India’s railway sector while maintaining financial sustainability.
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