A view shows traffic on central Tverskaya street with the state-owned bank Sberbank headquarters (right) in downtown Moscow on July 11, 2022. (PHOTO / AFP)

TEHRAN - Iran has made two financial arrangements with Russia to facilitate its imports from the latter, Iran's state-run IRNA news agency reported Wednesday.

The deals, which include a letter of credit and a line of credit, were made during a visit by Iran's central bank chief, Mohammad Reza Farzin, to Moscow, the report said.

On Wednesday, Farzin (Iran's central bank chief) met with his Russian counterpart Elvira Nabiullina and finalized an agreement to use their national currencies, the Iranian rial and the Russian ruble, in bilateral trade instead of the dollar, Iran's IRIB news agency reported

Under the first deal, Iran's Bank Sepah opened a 17-million-euro ($18.9 million) letter of credit in Russia to guarantee payments for imports from the country, IRNA said. A letter of credit is a payment method that provides an economic guarantee from a bank to an exporter.

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This is the first letter of credit opened by Iran's banking network abroad since the US reimposed sanctions on Iran after withdrawing from a 2015 nuclear deal in May 2018, the report said, adding it will allow Iranian traders to buy goods from Russian suppliers more easily.

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Under the second deal, Russia's Sberbank and Iran's Bank Melli agreed to create a 6.5-billion-ruble (around $70.91 million) line of credit for Iran's imports of essential goods from Russia, which eases the access of the Iranian exporters to Russian loans, the IRNA said. A line of credit is a preset borrowing limit that can be used repeatedly.

Farzin, who headed a technical delegation, arrived in Moscow on Tuesday for talks on expanding monetary and banking cooperation and improving ties with Russia under a free trade agreement signed by Iran and the Eurasian Economic Union on Monday, the report said.

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On Wednesday, Farzin met with his Russian counterpart Elvira Nabiullina and finalized an agreement to use their national currencies, the Iranian rial and the Russian ruble, in bilateral trade instead of the dollar, Iran's IRIB news agency reported.

Iran and Russia, both under US sanctions, have recently strengthened their political and economic ties to counter the US pressure.