The ECB loan is being syndicated by ABN Amro Bank and State Bank of India. General syndication has been launched by the co-ordinating arrangers on November 1, 1998, and the target date of closure is November 16, 1998. The ECB loan carries a fixed rate of interest between 3% and 3.5% per annum and is for a tenor of 9 years and 8 months.

IRFC managing director P Rajagopalan said, "So far the response is good. S&P's downgrading has not affected the sentiment in the international market and we are hopeful of mopping up the target amount." The loan is being availed to refinance a loan worth 11.7 billion yen availed between 1988 and 1995 by the corporationfrom the Export-Import Bank of Japan and disbursed to the Indian Railways over an eight-year period for financing the rolling stock. IRFC has already repaid a part of the total loan availed from the Export-Import Bank of Japan. The refinancing is likely to result in a saving of at least 640 million yen per annum in interest costs.