Iraqi Prime Minister Mohammad Shia al-Sudani’s advisor Hazem al-Khalidi led a delegation this week to Tehran where discussions focused on enhancing cross-border commerce and infrastructure.
The talks included finalizing agreements on the Shalamcheh–Basra railway between the two countries and establishing joint free trade and industrial zones along their border.
"The completion of the Basra-Shalamcheh railway could significantly enhance the capacity of Iranian companies to collaborate with their Iraqi counterparts," Iran's Acting Minister of Economic Affairs and Finance Rahmatollah Akrami said.
Upon completion, the 36-kilometer railway is expected to connect Iraq's southern city of Basra to Iran’s rail network, facilitating the transport of up to three million passengers per year and supporting the development of border markets and industrial zones.
It will also significantly boost trade by reducing transit costs by up to 20 percent.
The two sides also agreed to follow up on formulating a mechanism to settle Iran’s financial entitlements, as well as the recognition of Iranian bank guarantees for exporters and investors in Iraq.
The Iraqi visit coincided with Iran Expo 2025 in Tehran - the country's largest largest trade event to introduce Iran's economic and technical engineering opportunities and capacities.
Over the years, US sanctions have significantly hampered Iraq’s ability to settle energy debts with the Islamic Republic.
US President Donald Trump’s administration has consistently pressured Iraq to minimize its economic and diplomatic ties with Iran.
On March 8, the US administration said it revoked a US sanctions waiver allowing the Iraqi government to import electricity from Iran.
Weeks later, Iraq was granted a short-term sanctions waiver by the US administration in order to meet its energy needs by importing Iranian electricity.
Iran is the leading supplier of natural gas to Iraq, accounting for as much as 45 percent of the country’s daily electricity consumption of 14,000 megawatts.
Press TV