Bangladesh and China signed a $2.6 billion loan deal on the Padma bridge rail link project yesterday.

Zahidul Haque, additional secretary of Economic Relations Division of the finance ministry, and Sun Ping, vice president of Exim Bank of China, inked the agreement on behalf of respective sides in Beijing, ERD Joint Secretary AKM Matiur Rahman told The Daily Star.

Of the total project cost of $3.1 billion, Exim Bank will provide $2.6 billion while the rest would be given by Bangladesh Railway, he said. The loan carries a 2 percent interest rate.

The project will enable a direct rail link between Dhaka and the southern parts of Bangladesh, particularly the Mongla port and the Benapole land port. The rail link project is scheduled to be implemented by 2022. The government plans to open the bridge by December 2018.