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Iran, South Korea Sign 720-Million-Euro Contract to Buy Rail Bus Wagons

Iran, South Korea Sign 720-Million-Euro Contract to Buy Rail Bus Wagons

Monday, 4 December, 2017 - 06:15
This handout photo released by Korean state rail operator KORAIL shows its homegrown bullet train KTX-II (front) and the existing KTX (background) at a railway station in Seoul. (AFP)

Iran has signed a contract worth 720 million euro Saturday with the South Korean company Hyundai Rotem to buy 450 rail bus wagons, reported the Iranian TV.

The contract was signed in Tehran by Hyundai Rotem and Iranian Rail Industries Development Co (IRICO), which is part of Iran's railways department. Iranian Minister of Roads and Urban Development Abbas Akhoundi attended the signing ceremony.

As per the contract, funded by the South Korean side, Hyundai Rotem will manufacture 300 trailers in Iran in cooperation with the Iranian company, and will create 1,000 direct jobs and 1,700 indirect, along with manufacturing 150 vehicles in South Korea, according to IRICO’s general manager.

In August, Iran received an 8 billion-euro loan from the Export–Import Bank of Korea (KEXIM).

Director of Iran’s Central Bank Valiollah Seif said that the loan will boost many of the development and production projects.

South Korea is an important economic and trade partner for Iran, but has greatly reduced its ties with Tehran over international sanctions linked its nuclear program.

Since the signing of the nuclear deal between Iran and the world powers in July 2015, Tehran has sought to develop its economic and trade relations with Asian and European countries despite the opposition of US President Donald Trump.

In September 2017, Iran signed an agreement with the Bank of China to fund several infrastructure projects worth $10 billion, and was promised to receive an additional $25 billion fund, the central bank said.

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