Iran asks Russia for $2 billion

Iran has asked Russia for a $2 billion loan, announced Russian Energy Minister Alexander Novak on Saturday after meeting with his Iranian colleague Reza Ardakanian.

Tehran needs the money for a number of projects, including the construction of a thermal and a hydroelectric power plant, a railway line, and carriages for its metro system, Reuters cites Novak as saying.

The figure named by the Iranian energy minister ahead of his trip to Moscow was somewhat larger, at $5 billion.

However, Novak explained that only $2 billion will be new. “They had $5 billion in mind with respect to previously made decisions. They say that they were promised a total of $5 billion in 2015… We have already provided loans, but now they are asking to bring the total amount to $5 billion,” the minister clarified.

He said that the Russian Finance Ministry is currently considering the matter.

The Iranian Majles approved the decision to take a loan from Russia in February. Russian funds were added to the list of sources of government income for the financial year that starts on March 21 (the year 1398 according to the Persian calendar).

The funds are earmarked for infrastructural projects, including nuclear energy and other sources of electrical power, railway transport, and the building of dams, irrigation networks and water pipelines.

Voting took place four days after Iranian President Hassan Rouhani returned from an official visit to Sochi. After meeting with Russian President Vladimir Putin, he said that Moscow and Tehran’s bilateral relations were “good and growing” and moving “towards the strategic level”.

Russian export loans are already being used to finance the construction of the Sirik thermal power plant in Iran and to electrify the Garmsar-Inche Burun railway line. Other joint projects between Iran and Russia include the Bushehr Nuclear Power Plant, which is being built by Rosatom, and the construction of the North-South international transport corridor from the Indian port of Mumbai to St. Petersburg, and from there to Europe, which Russian officials have envisaged as an alternative to the Suez Canal.

  Iran, Russia, Tehran

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