The Egyptian National Railways (ENR) is set to build its first factory to manufacture carriages locally in the Delta town of Abu Za’bal in Qalyubia, according to a report.

The factory will help save foreign exchange used to import railway equipment, Ahmed Hamed, chief of ENR, was quoted as saying in the Cairo Post report.

The technical and economic feasibility studies of the train and metro carriages factory will be finished in April by China’s AFIC International, it said.

The town was chosen because it hosts ENR’s production workshops. The project will develop the workshops and connect them to the factory, Hamed was quoted as saying

The factory will be established per an agreement with the holding company AFIC International, signed during the Egypt Economic Development Summit last month.

AFIC will execute the project with a preliminary investment of $500 million.

Meanwhile, the government plans to build more train factories to sustain domestic needs and also begin exporting the production.