Israel’s cabinet has approved the construction of a railway line from Tel Aviv to Eilat.

The 350km line will be for passengers and freight and is due to shorten travel time to two hours. It will take five years to build.

A team chaired by Prime Minister's Office director-general Harel Locker will consider three alternatives for financing the project: an inter-governmental agreement between Israel and another government; establishing the project in cooperation with the private sector; or funding from the state budget.

Prime minister Benjamin Netanyahu said: "In the coming decade, new powers will arise and the State of Israel must create vital interests from a national strategy point-of-view.  We have the ability to create an alternative transportation route that bypasses the Suez Canal – this is an insurance policy.  Israel must become a continental land crossing route and create great power interests.  The Tel Aviv-Eilat railway line, which will shorten travel time to two hours, will change the face of the country.  For 63 years, there has been talk about linking up the periphery to the centre, but nothing has been done.  The railway line and Israel's natural gas resources can forge strong links in the economic, energy and industrial fields."

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