Iran has allocated $60 million for the construction of a highway between Iran and Armenia, IRNA agency reports referring to member of the Iranian parliament Ali Reza Manadi.

According to him, the highway linking Iran and Armenia would contribute to develop the cities and towns along its route.

In September 2009, the Armenian government and Asian Development Bank signed an agreement on the allocation of $500 million for construction of the 550-kilometer long Iran-Armenia highway. The project was estimated at U.S. $1.5 billion.

To date, only $300,000 has been allocated for the initial stage. As part of the program, Armenia’s existing roads from the border with Iran to the border with Georgia will be reconstructed.