Rail bosses have put forward a business case for work on the Birmingham to Shrewsbury line, which would boost train speeds to 90mph.
According to the plans, the project – which has been backed by MPs – will deliver economic benefits of £23m, with £16 created for the region for every £1 invested.
Work is slated to start in 2025 if it is given the green light by the Department for Transport.
Bosses hope the improvements will be a precursor to the full electrification of the line, which is expected to cost £200m.
Maria Machancoses, CEO of Midlands Connect, said: “Today’s news is another step forward and a major milestone in our journey towards delivering this major project as part of our Midlands Engine rail programme.
“In the medium term, we are championing the need for direct, hourly trains to London and electrification but we are also promoting the short-term win of a line speed improvement.
“I believe that this project will help level up the Black Country, support economic development in Shropshire and unlock the fantastic growth of Telford in the years ahead.”
As part of the scheme, tracks will be realigned on two stretches to shorten the route, while signalling improvements will be brought in.
It comes after the Government’s Union Connectivity Review identified the importance of Shrewsbury as a centre for connecting Wales to the Midlands.
Jane Stevenson, MP for Wolverhampton North East, said: “This business case is another step towards delivering better links and greener and faster trains between Wolverhampton and Shrewsbury.
“For my constituents it could also potentially mean a new railway station in Pendeford, so that more people can have wider access to jobs, training or school.
“Wolverhampton has seen major investment in the last few years and I believe that this project is another concrete example of levelling up the Black Country.”
Shrewsbury and Atcham MP Daniel Kawczynski, said: “Boosting line speed on this important route through Shrewsbury to 90-miles-per-hour will be a massive boost for local passengers and businesses, speeding up journeys and encouraging motorists to leave their cars at home.
“It’s fantastic that these plans are being brought forward and could be a great short-term win for this project.
“On a personal level, I’ve long campaigned for the electrification of this line, something that will secure truly green, sustainable connectivity for generations to come.
“I’m keen that Government supports us in the delivery of these improvements as soon as possible.”