MOSCOW - Russian companies will modernize railway network and build new railroads in the Democratic People's Republic of Korea (DPRK) in the next 20 years, a senior Russian official said Tuesday.

Far East Development Minister Alexander Galushka said Russian private investors will invest $25 billion to upgrade infrastructure and 3,500-km railroads in the DPRK in exchange for access to the country's natural resources.

"This is a mutually beneficial commercial victory project," RIA Novosti news agency quoted Galushka as saying. Pyongyang will compensate Russian investors' expenses with supplies of coal, minerals and other raw materials, he said.

Russia's largest hydropower company RusHydro will conduct a feasibility study on the construction of an energy bridge linking Russia's Far East, the DPRK and the Republic of Korea, Galushka said.

The two countries planned to set up a business council in the near future, Galushka said, adding that Moscow and Pyongyang also has agreed "in principle" to scrap visas for each country's citizens.

Economic cooperation between Russia and the DPRK facilitates military and political stability in the Korean Peninsula, the minister noted.

Russian Foreign Ministry said in September that Moscow and Pyongyang would make joint efforts to boost constructive bilateral cooperation in all fields.

Related: DPRK to remodel railway with help of Russia