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Russia Prepares Billion-Dollar Loan for Iran
(MENAFN) Russia has completed preparations to extend a $1 billion loan to Iran, with the funds reportedly ready to be transferred once Tehran submits the necessary bank account information, according to reports.
The payment arrangements have already been completed, but the transfer is being held up by disagreements within the Iranian government over how the money should be allocated.
The loan was initially reported in June and is considered the first tranche of a broader $20 billion financing package that Russia is expected to provide to Iran.
Several Iranian government bodies have put forward different proposals for the use of the funds. The Planning and Budget Organization is seeking to direct the money toward vehicle imports, while the Oil Ministry wants to purchase equipment for the energy sector. Meanwhile, the Agriculture Ministry is calling for the funds to be used to import essential commodities.
No agreement has yet been reached on the allocation of the loan. As a result, Iranian authorities have not supplied the bank account details needed to complete the transfer.
Moscow and Tehran have increasingly sought to expand economic and financial cooperation, including initiatives aimed at increasing the use of their own currencies in bilateral commerce and reducing dependence on financial systems controlled by Western countries.
Iran announced in June that it planned to establish a ruble trading board as part of broader efforts to strengthen monetary and banking cooperation with Russia. An Iranian lawmaker said at the time that Moscow was expected to extend a $20 billion loan denominated in rubles, carrying an annual interest rate of 6%.
The payment arrangements have already been completed, but the transfer is being held up by disagreements within the Iranian government over how the money should be allocated.
The loan was initially reported in June and is considered the first tranche of a broader $20 billion financing package that Russia is expected to provide to Iran.
Several Iranian government bodies have put forward different proposals for the use of the funds. The Planning and Budget Organization is seeking to direct the money toward vehicle imports, while the Oil Ministry wants to purchase equipment for the energy sector. Meanwhile, the Agriculture Ministry is calling for the funds to be used to import essential commodities.
No agreement has yet been reached on the allocation of the loan. As a result, Iranian authorities have not supplied the bank account details needed to complete the transfer.
Moscow and Tehran have increasingly sought to expand economic and financial cooperation, including initiatives aimed at increasing the use of their own currencies in bilateral commerce and reducing dependence on financial systems controlled by Western countries.
Iran announced in June that it planned to establish a ruble trading board as part of broader efforts to strengthen monetary and banking cooperation with Russia. An Iranian lawmaker said at the time that Moscow was expected to extend a $20 billion loan denominated in rubles, carrying an annual interest rate of 6%.
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