UK Export Finance (UKEF) has agreed to guarantee a €2.4bn loan from a group of commercial banks for a high speed electric railway project in Turkey.

The deal, signed in December, will see the UK’s official export credit agency (ECA) cover 85% of the total financing through its buyer credit scheme, which backs exports by British companies.

The 500km electric-powered railway line will connect Ankara, Turkey’s capital, to the port city of Izmir.

UKEF says the transaction, which was led by Credit Suisse and Standard Chartered, meets internationally recognised sustainability standards and is aligned with the Green Loan Principles.

“When complete, the new line will provide a faster, lower carbon alternative to current air and road routes between the two cities, helping to fulfil Turkey’s climate change commitments made at Cop26,” UKEF says in a statement.

Other banks involved on the transaction include BBVA, BNP Paribas, Commerzbank, Deutsche, DZ Bank, HSBC, ING, JP Morgan, KfW Ipex-Bank, Landesbank Baden – Wurttemberg, Lloyds, Santander, Société Générale, and UniCredit.

Reinsurance is also being provided by other ECAs, namely Sace in Italy, Serv in Switzerland and OeKB in Austria.

UK companies are expected to supply British-made railway lines, turnouts, point machines, fasteners, material and equipment for signalling, telecommunication and electrification systems, as well as vital insurance and freight services.

Engineering and construction giant ERG International Group is involved and will support the project through its UK supply chains.

“It is fitting that UK Export Finance’s biggest ever civil infrastructure deal is strongly sustainable. This is a proud moment for the UK railway industry, using its industrial roots to reduce emissions in heavily polluted cities,” says international trade secretary Anne-Marie Trevelyan.

The Turkish government has previously tapped support from European ECAs as it works to develop the nation’s rail infrastructure. In November, Turkey’s finance ministry signed an export loan worth €576mn with Denmark’s EKF, in a deal supporting the construction of a high-speed railway in the country.

UKEF has itself been ramping up support for domestic exports to Turkey. In the latter months of 2021, the agency signed its largest ever guarantee for a solar project financing, in a bumper deal backing British sales to a new facility there.