The French company, which already has contracts for metro systems in several Indian cities, also signed a €200m contract to provide the electrification, signalling and telecommunications for a portion of a "dedicated freight corridor" between Delhi and the eastern port of Kolkata (formerly Calcutta).
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India's plan to buy new locomotives and build more track has been negotiated since 2007, but the election of Mr Modi's Bharatiya Janata party government last year accelerated the process.
"There is a new momentum, that's clear," said Henri Poupart-Lafarge, Alstom's president for transport, shortly before a signing ceremony in New Delhi. India, he said, was progressively becoming the centre of Alstom's Asian footprint, and Alstom was poised to more than double its 1,500 employees in India.