The loan, agreed in October, is to be repaid in 10 years at 2 per cent interest.
The Bulawayo coal-fired plant (pictured) was commissioned in 1957 and refurbished in 1999. Its initial installed capacity was 120 MW.
Mothballed for over 10 years, the plant was brought back online in 2011 to help address Zimbabwe’s power crisis.
The upgrade process is planned to restore the plant from its current generation capacity of 30 MW to 90 MW. It is expected to take two years.
India's Export-Import Bank has also lent Zimbabwe $28m for an upgrade to the 920 MW Hwange coal-fired plant’s cooling system.