Uganda's Standard Gauge Railway project co-ordinator, Perez Wamburu, said the agreement was for the first section of a planned 1 700 km electric rail line.

The project will increase trade and reduce transport costs, Uganda's Works Ministry permanent secretary, Bageya Waiswa, said at the signing ceremony.

He said Uganda will use its own funds and credit from export credit organisations to finance the project, which will take 48 months to complete once started.

The rail section will run from the capital Kampala to Malaba at the border with Kenya, connecting landlocked Uganda to its neighbour's rail network and onto the Indian Ocean seaport of Mombasa.

--Reuters--