Under the Malakand Tunnel Loan Agreement, an amount of 78 million dollars will be provided for the project. The Korea Exim Bank is an official export credit agency providing comprehensive export credit and guarantee programmes to support Korean enterprises in conducting overseas business.
Malakand tunnel will provide a short route not only to people of Dir, Malakand and Swat and adjacent localities but would also be an easy access to central Asian states, providing the market access to the country for its products. Malakand Pass lies between Dargai-Batkhela and is situated at an altitude of 470 metres and 663 metres, respectively.
The South Korean government pledged the 78 million dollars funding through the Economic Development Co-operation Fund (EDCF) for the construction of Malakand tunnel project in Khyber Pakhtunkhwa. The 9.7 km project also includes approach roads on both sides of the tunnel and three bridges.
The initial feasibility study of the tunnel has already been completed by South Korean consultants in collaboration with National Highway Authority Pakistan, which is also the project executing agency. The President said it was high time for Pakistan and Korea to take its bilateral trade to new heights while exploring the true potential of trade and investment existing between the two countries, urging the business community of the two countries to boost its trade volume from current over 1.5 billion dollars to two billion dollars in the next three years.
He said that number of major Korean companies were doing business in Pakistan and had invested in major projects in Pakistan including chemical plants, energy and infrastructure projects and building port facilities. The President said that now when the government had opened all sectors of economy open for investment, the Korean companies should avail the enormous opportunities and incentives, the government offered for investment in Pakistan. He reiterated that government would provide foolproof security and one window operation to the Korean entrepreneur for investment in the Special Economic Zones.
Later, President Asif Ali Zardari had meeting with Chief Executive Officer of the Korea water Resources Corporation (K-Water) Kim Keun-Ho. After the meeting, the memorandum of understanding (MoU) was signed between the Korea Water Resource Corporation (K-Water) and Water and Power Development Authority of Pakistan (Wapda). Under the MoU, both the sides will work for sustainable water and power sector development and cooperate in development of water resources infrastructure, including dams, hydropower, flood control and canals.