Network Rail confirmed the contractor as winner of the scheme today with the value of the deal reducing from an original £294m to £220m.

BAM Nuttall will be hosting a “meet the buyer” event ahead of the start of main construction work next year with 500 jobs set to be created on the project.

The Borders Railway, which will enter service in 2015, will re-establish a passenger rail link for the first time in over 40 years from Edinburgh through Midlothian to Tweedbank.

The line will include 30 miles of new railway with three existing stations and seven new ones – at Shawfair, Eskbank, Newtongrange, Gorebridge, Stow, Galashiels and Tweedbank.

David Simpson, Network Rail route managing director for Scotland, said: “The appointment of BAM Nuttall as our main contractor signals the start of the delivery of the new railway for the communities it will serve.

“BAM Nuttall has already been working closely with Network Rail in drawing up initial designs for the new line and can now carry that momentum into the delivery of the main construction phase as we work to complete the new line for the start of services in 2015.”

Stephen Fox, Chief Executive of BAM Nuttall added: “We are delighted to be starting work on delivering this significant rail project on behalf of the people of Scotland and our customer Network Rail.

“This scheme brings together the engineering strengths of the BAM Group and will create significant local employment opportunities. In addition it will provide a much needed rail link to those rural communities living in the Scottish borders region”.