Iran, China to sign $4B metro contract - TV

Iran, China to sign $4B metro contract – TV

Underground transport system deal in Iran bolsters historical economic relationship with China. News follows Iran's announcement that it is adding new centrifuges to speed up uranium enrichment.

July 20, 2011 10:06 by p.deleon

Iran will sign a $4 billion contract with China for development of an underground transport system in Iran, state television quoted an official as saying on Tuesday.

“The $4 billion financing contract will be signed with China tonight,” said Mohammad Royanian, head of Iran’s Transport and Fuel Management Office. He gave no other details.

China, the second biggest importer of Iranian oil after Japan, has long been involved in infrastructure projects in Iran where economic sanctions have hampered investment by Western companies.

Iran said in February that China had signed a $13 billion contract to build a railway network in the Islamic state.

Trade between the two countries is worth around $30 billion per year. President Mahmoud Ahmadinejad has said he hopes to increase the volume of trade to $100 billion.

As a permanent member of the UN Security Council, China voted in favour of a fourth round of UN sanctions against Iran last year, aimed at pressuring Tehran to curb its nuclear programme.

The US and its allies say Iran is trying to build bombs under cover of its nuclear programme. Iran denies the allegations, saying its nuclear activities are peaceful.

China has backed Iran’s right to peaceful nuclear power and has expressed displeasure at proposed sanctions that would hit Iran’s energy sector, saying that it does not view such measures as the “fundamental solution” to the dispute. (Writing by Mitra Amiri; editing by Elizabeth Piper)