PLANS for a massive rail freight terminal that would create up to 2,000 jobs and could secure work for Derby's train industry have been revealed.

Work will start in January on creating a train connection to the Castle Donington site after Brailsford property firm Clowes Developments signed a multi-million-pound deal with Network Rail.

Clowes is hoping the link, which will be able to handle thousands of tonnes of goods, will attract big employers to its East Midlands Distribution Centre scheme.

Once businesses have signed up, Clowes will then invest further millions on building warehouses for them, creating the 120-acre distribution hub.

According to the company, it could be up and running by the end of 2012.

Paul Shanley, Clowes' director, said: "Despite the difficult economic times, we are investing in the future of this major site. We have decided to go ahead and build this so that when a suitable occupier is on board, they won't have to wait years for a rail link.

"In terms of attracting businesses to come to the East Midlands Distribution Centre, this puts us ahead of the competition."

The work to connect the site, in Back Lane, off junction 24 of the M1, from the existing Birmingham to Nottingham freight line, involves reinstating tracks, signals and points. It will be overseen by Network Rail, which estimates it will be complete by summer 2011.

As part of the deal, believed to be worth about £10 million, it will contract out work to other companies, which could include Balfour Beatty, whose rail division employs over 300 people in Derbyshire, and other specialist Derby firms.

Michelle Craven, vice-chairman of the Derby and Derbyshire Rail Forum, which represents the region's rail firms, said the deal was very positive news.

"We welcome any rail investment in the region and anything that will bring work to our members," she said. "It is a large amount of work that is sitting on our doorstep.

"We are looking to work with National Rail and large rail contractors like Balfour Beatty to find out how we can promote our members' involvement."

The rail link and terminal would allow large containers to be transported to Castle Donington from deep sea ports in the UK and link up with the European rail network via the Channel tunnel.

It is also close to East Midlands Airport, making it more attractive for businesses.

John Proctor, partner at property agent Fisher Hargreaves Proctor, said negotiations had already taken place with businesses interested in taking space at East Midlands Distribution Park. He said: "It is hugely significant that Clowes is investing in this site.

"There has been interest from occupiers requiring a rail freight terminal and the site has been short-listed by a number of people and we are working hard to complete the deals.

"I would estimate that between 1,500 and 2,000 jobs would be supported there."

The news has also been welcomed by the East Midlands Development Agency.

A spokesman said: "Any new rail freight infrastructure in the region would be a very welcome addition to the regional economy, helping to attract new businesses to the East Midlands.

"This region is particularly strong in the logistics sector and a new rail freight terminal would further add to our strengths. Improving rail freight facilities would also benefit people and businesses indirectly, by helping to take trucks off the road network, easing congestion and reducing carbon emissions."

In May, the agency published a report into which sites in the East Midlands could accommodate a rail freight terminal. It concluded the site at Castle Donington was one of three in the Derbyshire area best suited for such a large-scale project.

The report suggested that Markham Vale, near Chesterfield, could have a terminal by 2012, Egginton Common, South Derbyshire, by 2018 and the Castle Donington site by 2022. However, Clowes Developments believes that work could go ahead much sooner.

Mr Shanley said: "The beauty of this site is that once the connection is ready to go we could move quickly to build the terminal. The most optimistic scenario is that it will receive its first freight in 2012."