Yang said the tunnel was once a "crazy dream" but is now a potential reality because of the arrival of Chinese investors.
"Private and State investors from China are very interested in this project in terms of investment as well as providing equipment and labor," Yang said. "They can raise the money. Now, the biggest issue will be concerns about the environmental impact."
The excavation of the Baltic seabed and the construction of the rail line in Northern Finland and Norway has met with opposition from environmental groups and indigenous communities.
The railway would run through the territory of the Saami people of Lapland. Many Saami make a living from reindeer herding, and leaders from the community are worried the rail line will disrupt reindeer migration routes.
"This is a valid concern," Vesterbacka said. "The concern comes mainly because of a lack of detail right now of exactly where the line will go. Part of the rail line will go underground to allow for the natural flow of reindeer and other species."
The World Wildlife Foundation, which is also called the WWF, has raised concerns about the increased use of the Northern Sea Route.
"The Arctic environment is already under massive stress because of climate change. It's the most rapidly changing environment on the planet," said Simon Walmsley, senior Arctic sustainability advisor for the WWF. "We would prefer that there wasn't this level of development. We are not anti-development, but it should be well thought out and well planned before it takes place."
Walmsley said increased shipping could lead to the introduction of harmful invasive species, as well as pollution caused by leaked fuels and emissions.
The WWF wants trading nations to phase out the use of ships that burn Heavy Fuel Oil in the Arctic. This fuel is particularly damaging to the Arctic environment because it emits black carbon, which creates a dark film on snow and ice, making it melt more quickly.
The WWF is an observer on the Arctic Council, which is an intergovernmental forum that addresses issues faced by the people living in the Arctic region.
"We will be communicating our concerns through the Arctic Council and the International Maritime Organization," Walmsley said.
"We'll be communicating particularly with Finland, as Finland is the chair of the Arctic Council. We think a big planning regime has to happen, before this route is even considered."
After the release of China's white paper on the Polar Silk Road, Vice-Foreign Minister Kong Xuanyou said China would develop responsibly in the region.
"Some people may have misgivings over our participation in the development of the Arctic, worried we may have other intentions, or that we may plunder resources or damage the environment," Kong said. "I believe these kinds of concerns are absolutely unnecessary."
The paper said that China would move forward while "respecting traditions and cultures of the Arctic residents, including indigenous peoples, and conserving the natural environment".
