Thank you for your comments. I have upgraded the latest version of Archive::Zip 1.30(released in 2009) through ppm on my windows machine. But no use.

As i just truncate these swedish character to "_" and also got approval for this, this is not required for me for time-being. But still i am wondering about this issue.

http://cpansearch.perl.org/src/ADAMK/Archive-Zip-1.31_03/Changes

Revision history for Perl extension Archive-Zip

1.31_03 Thu 30 Jun 2011 - H.Merijn Brand
	- Add decryption support

1.31_02 Wed 9 Mar 2011 - Adam Kennedy
	- More fixes by HAGGAI, which he still doesn't detail in Changes

1.31_01 Fri  5 Mar 2010 - Adam Kennedy
	- Various fixes by HAGGAI, which he has not yet provided details on:
	- Experimental Unicode in file/dir names

http://cpansearch.perl.org/src/ADAMK/Archive-Zip-1.31_03/README

Archive::Zip Global Variables
    $Archive::Zip::UNICODE
        This variable governs how Unicode file and directory names are
+ added
        to or extracted from an archive. If set, file and directory na
+mes
        are considered to be UTF-8 encoded. This is *EXPERIMENTAL AND 
+BUGGY
        (there are some edge cases on Win32)*. Please report problems.

            {
                local $Archive::Zip::UNICODE = 1;
                $zip->addFile('Déjà vu.txt');
            }
[download]

It looks like the version CPAN will install is 1.30. If the OP wants to install 1.31_03 will he need to download and use Perl makefile.pl, dmake, dmake test, dmake install? Maybe someone who knows more about cpan knows a way to get the latest by using the cpan prompt.

Update: I found out how to install a different version of a cpan module than the one cpan defaults to.

From the command prompt type 'cpan' and hit enter. Then from the cpan> prompt type 'install A/AD/ADAMK/Archive-Zip-1.31_03.tar.gz'.

This should install the file located at http://cpan.perl.org/authors/id/A/AD/ADAMK/Archive-Zip-1.31_03.tar.gz.