Raipur, Feb 17 (IANS): Chhattisgarh wants industrial rail corridors in its sprawling northern region that has an estimated 20 percent of India's coal deposits.

The government and Indian Railways are set to sign a Memorandum of Understanding (MoU) to set up the corridors, official sources said Friday.

Chief Minister Raman Singh met Planning Commission Deputy Chairman Montek Singh Ahluwalia and Railways Minister Dinesh Trivedi Thursday in New Delhi.

Both have given the green signal for the ambitious project, a senior official told IANS.

The Chhattisgarh government and the railways will sign the pact later this month. The project will cover 453 km of rail lines in seven economically backward but coal-rich districts.

The project will be a boon for the dominantly tribal people of the area. The project is basically the brainchild of Raman Singh.

It was prepared by a working group comprising mainly Chhattisgarh officials and Arunendra Kumar, general manager of South East Central Railway, India's most profit-making rail zone.

It will improve passenger and freight rail services in districts where dozens of companies are either setting up major coal-fired power plants or are expanding their production capacities.