IRFC Moves to Cut Rail Debt Costs with ₹10,000 Cr Refinance, Eyes Cheaper Metro Funds.

The Indian Railway Finance Corporation Ltd (IRFC), a key infrastructure financier for India's sprawling rail network, is poised to refinance approximately ₹10,000 crore in high-cost loans. These loans were originally secured from multilateral and other international agencies to fund ongoing Indian Railways projects.

The strategic move, anticipated in the second quarter of the current fiscal year (FY25), is projected to yield a substantial 100-150 basis points (1-1.5%) interest cost arbitrage. This means IRFC expects to secure new loans at significantly lower interest rates, resulting in considerable savings for the organization.

Refinancing, in essence, involves replacing an existing loan with a new one that typically offers more favorable terms, such as a lower interest rate, a longer repayment period, or improved repayment conditions.

Manoj Kumar Dubey, Chairman and Managing Director and CEO of IRFC Ltd, stated that this refinancing initiative is a core component of the company's wider strategy. The goal is to reduce overall financing costs for railway infrastructure development and solidify IRFC's position as a competitive funding vehicle for both national railway projects and the country's burgeoning urban transport initiatives, including metro rail.