More than four-fifths of the project will be funded by the soft Japanese loan, which is below the market-rate of inflation. 

News outlets, such as Reuters, give different costs for the project, which range between $17bn and $19bn.

The loan is part of the plan of the leaders of Japan and India to counter China's influence across Asia. 

Indian prime minister Narendra Modi thanked his Japanese counterpart Shinzo Abe, who “gave a loan of 88,000 crore rupees” for the project which “will add speed to India’s growth”. 

The train will have a maximum speed of 350km/h, more than twice the speed of India’s current fastest train, and will cover over 500km in around two hours. The project is expected to be completed by 2022.

The bullet train was a key part of Modi’s election campaign in 2014 and claims the project will create about 36,000 jobs.