Siemens announced on Monday that it has signed a 3 billion euro contract to supply and service freight trains in India, the largest locomotive deal in the company's history.

Siemens will deliver 1,200 electric locomotives and provide service for 35 years under the agreement, which is also the company's largest in India.

The 1,200-horsepower Siemens-designed trains will be assembled in the Indian Railways Factory in Gujarat state over the next 11 years, with deliveries beginning in 24 months.

“These new locomotives … can replace between 500,000 to 800,000 trucks over their lifecycle,” said Siemens Mobility CEO Michael Peter.

The order was a big step for Siemens in India, Peter told, saying the company had previously been very strong in North America and central Europe in rolling stock but mainly provided components and infrastructure in India.

“India is looking for technology, better efficiency, and longer lifespan for its trains,” he said in an interview. “In the past India built their own trains, but they want to increase reliability and average speeds.”

This is Siemens' second large contract, following a 900 million euro deal in December for a new metro line in Sydney, Australia.

Although this contract would primarily appear as orders in 2023, Peter was confident that Siemens would meet its goal of increasing revenue in the mobility business by 6-9% this year.

He added that Siemens was looking into other train contracts in India, the world's largest rail market, with 24 million passengers riding on more than 22,000 trains every day.

According to Siemens, whose first contact in India - a London-Calcutta telegraph line - dates back to 1867, the government wants to increase the rail network's share of freight transport to 40-45% from the current 27%.