Iran and Russia sitting in a tree… Again.

The Times

TUESDAY MARCH 13 2001

Moscow defies US with Iran arms deal

FROM ALICE LAGNADO IN MOSCOW

RUSSIA will sell billions of dollars worth of arms to Iran in breach of an agreement with the United States that has underpinned regional security for the past five years, President Putin announced yesterday, after talks with President Khatami of Iran.
Moscow is expected to sign deals worth up to $7 billion (£4.8 billion), throwing the Kremlin’s already chilly relations with the new Washington Administration into disarray and further isolating Russia from the West.

Mr Putin’s public announcement of new arms deals is the latest sign of an increasingly hostile relationship with the United States as he seeks to show voters at home that Russia is still a world power.

After talks in the Kremlin yesterday he said that only “defensive” arms would be sold. “Iran has the right to ensure its country’s defensive capacity and security,” said Mr Putin, who has accepted an invitation to visit Iran.

His assurance is unlikely to convince Donald Rumsfeld, the US Defence Secretary, who has threatened to cancel American aid to Russia if it continues to sell arms to countries the United States calls “states of concern”, including Iran and North Korea.

Five years ago, after pressure from the United States, Moscow and Washington signed a secret agreement to ban conventional arms sales to Iran. Last year, however, Moscow announced plans to renege on the ban. The Clinton Administration threatened sanctions against Russia if it went ahead with sales.

US law stipulates that Washington must impose sanctions on countries which sell arms to seven countries which are officially identified as supporters of terrorism, including Iran.

In a four-day visit to Moscow by Mr Khatami starting yesterday — the first by an Iranian leader in almost 40 years — he is expected to sign deals to buy spare parts for Russian-made arms, such as MiG fighters and Su24 bombers, plus new air defence systems.

Sales could include the S300 PMU2 anti-aircraft missile system, with a range of 200 kilometres (124 miles) and the Yakhont missile, which has a range of 300 kilometres (186 miles) and could be used to block oil shipments in the Gulf.

Such sales would infuriate the US Administration, Ruslan Pukhov, a defence analyst, told the Moscow Times.

Russia is keen to make lucrative arms deals to revitalise its crumbling defence industry, and has vowed to become the world’s second-largest arms exporter after the US within the decade. It earned $4.3 billion from arms sales last year, the most since the collapse of the Soviet Union a decade ago.Iran is a natural customer for Russian arms, since it is seeking Moscow’s support for a scheme to give an equal share of the Caspian Sea’s oil riches to the states surrounding it, including Russia, Iran, Azerbaijan, Kazakhstan and Turkmenistan. Russia and Iran are anxious to stop a plan by the West to transport Caspian oil to the world markets through a pipeline to Turkey, bypassing their proposed routes.

Mr Putin reassured Tehran that delays in the building of a nuclear power plant in Bushehr, in southern Iran, would be investigated. Plans to build four reactors will bring Russia more than $2 billion.

Last week, however, a senior Iranian official complained that the first plant was only half-finished after seven years’ construction.

“Russian experts fully master nuclear technology but their management and planning is not on a level with their technical quality,” he said.”

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Thats a hell of a lot of money. I don’t think the Russians give a sh** about a few million of US aid when you compare it to a possible $9 billion.