Long-awaited proposals for hourly trains between Lowestoft and Ipswich should be realised by the end of next year.

The last piece in the jigsaw to allow the construction of the 'Beccles loop' to allow east Suffolk line trains to pass is set to be put in place next month.

The move comes after the government gave permission to Suffolk County Council to increase its borrowing for capital investment.

The government decision should also clear the way for other major projects including the �25m scheme to improve traffic flows around Ipswich and flood defence work on the River Blyth.

The government decision is expected to be discussed by the county council next month.

County councillor with responsibility for transport and the environment Guy McGregor was upbeat after hearing the news from Whitehall.

He said: 'I am very encouraged by the amount of capital funding we have got for Suffolk. I know there has been a lot of work to get there.'

Mr McGregor paid tribute to the lobbying of Suffolk MPs and said: 'We have had some good news – this will enable the Beccles Loop to be built and we have the investment in Ipswich which will make a huge difference once it is completed.

'There has also been the news about the A11 dualling and the rail chord in Ipswich (taking freight trains from Felixstowe to the midlands).'

The loop at Beccles will cost �4m. Network Rail has already committed �3m towards the bill as part of a re-signalling programme for the line being completed next year.

However the company had wanted to see a local commitment as well, and �1m from the county should secure the development.

That will allow an hourly service between Ipswich and Lowestoft from December 2012 - through Halesworth and Beccles as well as the stations at the southern end of the line which already have an hourly service.

Mr McGregor was at a meeting with Suffolk Coastal MP Therese Coffey, Waveney MP Peter Aldous and Waveney District Council last week where the news was discussed.

He said he hoped this would now encourage the district council to look at a scheme to regenerate the area around Beccles station.

Last night Waveney District Council said its economic regeneration team will provide support for the upgrade and development of the surrounding area around Beccles station, using the rail loop as a catalyst.

Council leader Mark Bee said: 'We are fully committed to playing our part in a project which is crucial for the future prosperity of east Suffolk.

'We have key teams in place with important, invaluable expertise to help deliver the loop and reap the very many benefits that this improved transport link would bring.

'The project would contribute significantly to the further regeneration of Beccles, Lowestoft and other east Suffolk locations and I am really excited by this wonderful opportunity and its potential to make a very real difference.'