According to an announcement from Russian state arms producer Almaz-Antey, the company will sell missile systems to Iran pending a commercial agreement.

The advanced S-300 missile system will be shipped to Tehran once an agreement is reached. Almaz-Antey CEO Yan Novikov confirmed that Russian restrictions on deliveries to Iran have officially been lifted, according to Ynetnews.

Russia Presses Ahead With Missile Sale To Iran

Voluntary embargo lifted by Russia

Restrictions had been put in place under pressure from Western powers in 2010, but have now been lifted. Novikov did not give any timeline for delivery or hint at how close a deal was.

“All restrictions have been lifted by the political authorities. When there is a contract, we will supply the system, including to Iran,” he said during a press conference. Russian President Vladimir Putin officially ended the ban in April when he signed a relevant decree.

Foreign Minister Sergey Lavrov said the embargo had been lifted due to progress in talks with Iran concerning its nuclear program.

“Initially, the decision to suspend the implementation of the contract, which was already signed and came into force, was made in September 2010,” said Russian Foreign Minister Sergey Lavrov. “It was done in the interests of support for consolidated efforts of the six international negotiators to stimulate a maximally constructive process of talks on settlement of the situation around Iran’s nuclear program.”

Lavrov was keen to emphasize that the suspension was implemented of Russia’s own accord. “Resolution 1929 of the Security Council, which was approved in 2010, just like any other UN resolutions did not impose any restrictions on deliveries of air defense weapons to Iran. I will emphasize, it was done in the spirit of goodwill to stimulate progress at the talks,” he said.

International concerns over new contract

The contract was initially agreed in 2007, and it stipulated that Moscow would deliver 5 divisions of the missile systems worth more than $800 million.  Iran paid $166.8 million in advance, but never received the systems due to the embargo. At that point the down payment was returned to Tehran and the contract terminated.

Israeli Prime Minister Benjamin Netanyahu spoke with Putin, voicing concerns over the decision to provide the missiles to Tehran. Putin reportedly reassured Netanyahu that the missiles could only be used for defensive purposes and “pose no threat” to Israel.

“Vladimir Putin explained the rationale for the decision in the current context and highlighted the fact that due to their tactical and technical characteristics, S-300 have a purely defensive significance and pose no threat to Israel,” stated the Kremlin.

The decision followed the recent interim deal between world powers and Iran aimed at curbing the development of its nuclear program. Russia is included in those talks, and is hoping to benefit economically if a final deal can be reached. The framework agreement was reached in the city of Lausanne, Switzerland, between Iran and six world powers – Russia, the U.S., France, Britain, Germany and China.

Delivery to be completed as soon as possible

Some of the parts of the system are being modernized, and contract terms are being revised. Both the U.S. and Israel raised objections to the developments, but Putin claims that the missiles will help to create a balance in the region.

Tehran has claimed that it expects delivery to be completed by the end of the year.

“The Iranians want them as soon as possible, and we are trying too,” said Vladimir Kozhin, Putin’s aide on military-technical cooperation. “There is activity to prepare new legal contracts, new conditions and thus prepare systems for delivery.”

Russia’s arms industry remains strong

Parts of the systems have been sold to other clients, while some systems that were in storage have undergone modernization. A more sophisticated S-400 system cannot be sold to Iran, and Kozhin claim that they would only ever be sold to China.

“There are certain thresholds beyond which no country can go,” said Kozhin, referring to Moscow’s arms trade with Beijing. “There is very reasonable balance. We cooperate very closely with China and they get whatever they want.”

Talks are ongoing between the two nations concerning the joint design and production of new weapons. Putin said last month that Russia is keen to emphasize joint production.

Russia exported $15.5 billion of military goods and technology in 2014, and $14 billion worth of new contracts were signed by Russian companies last year. Putin claims to have over $50 billion in the export order book.

Moscow produces and sells high-grade military technology, and can use it to disrupt international relations. It remains to be seen how the situation in the Middle East plays out, but the provision of rocket systems is a big development for Iran.