A Rs 98,000-crore project to lay India's first bullet train network between commercial nerve centre of Mumbai and Ahmedabad was on Saturday finalised at the annual summit talks between Prime Minister Narendra Modi and his Japanese counterpart Shinzo Abe.

"No less historic is our decision to introduce High Speed Rail on the Mumbai-Ahmedabad sector through Japan's Shinkansen, known for its speed, reliability and safety," Modi said at a joint media event with Abe.

He also greatly appreciated Abe's extraordinary package of approximately $12 billion (approx Rs 98,000 crore) and technical assistance, on very easy terms, for this project.

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The bullet train network will link India's financial hub Mumbai with Ahmedabad, the capital of Modi's home state Gujarat. Bullet train between the two cities will cut travel time on the 505-kilometre route from eight hours to around three.

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"This enterprise will launch a revolution in Indian railways and speed up India's journey into the future. It will become an engine of economic transformation in India," Modi said.

Foreign Secretary S Jaishankar said Japan will provide 80% of the funds for the project at 0.1% interest rate for a period of 50 years.