LONDON (Dispatches) -- UK
government officials were in Tehran last week discussing legal ways to pay Britain’s historical debt to Iran, the Iranian ambassador to London has said.
Mohsen Baharvand added that he was in live discussions with the Foreign Office, and said the issues were not insurmountable.
The UK Foreign Office has refused to discuss any details of the payment to Iran, or what has been holding up the settling of the debt, originally 400 million pounds, dating back to an arms sale to Iran in the mid-1970s.
Baharvand, speaking to reporters in London on Friday, said Iran and the UK had been close to an agreement on the debt in the summer.
“We wanted to use that deal to ask our people that we are seeing a good sign from the UK and then that gives us a possibility to expedite our efforts to help the dual nationals and things like that. Then we had a deal. We signed it but two days after the signature of that deal the UK government said they could not implement it because of U.S. sanctions,” he said.
“We are trying. We should not be that pessimistic. We are working with our Foreign Office colleagues maybe to reach that deal. We are in the process of discussions. Last week there was a delegation from the UK in Iran and personally I was talking to the Foreign Office and I am hopeful we will reach an agreement.”

Referring to reports that the money could be paid in the form of humanitarian aid, he said: “It’s not aid. Our money is here and we want our money. That is very simple. We want to receive our money. We are not insisting on interest. Otherwise it would be billions. We are talking to our UK colleagues as to which channel is the most probable to transfer that money to our accounts.”
Asked if the U.S. could give a letter of comfort to the UK to guarantee the payment would not be sanctioned, he said: “The Americans are not doing that. They have to help the UK government to do that. It is not impossible. Obstacles are not insurmountable, but we have to discuss, negotiate and find a way. We are now discussing through what channel that money be transferred. There is a negotiating process now.”
He also stressed that the issue of the detainees’ release was a matter for the Iranian judiciary, and could not be mixed up with the wider issue of the talks in Vienna to remove sanctions on Iran.
In response to the Iranian ambassador’s remarks a Foreign, Commonwealth and Development Office spokesman said: “We continue to explore options to resolve this 40-year-old case and will not comment further as discussions are ongoing.”
Foreign office sources stressed that the UK recognizes that it legally owes a debt to Iran.
In a question-and-answer session at the think tank Chatham House this week, the foreign secretary, Liz Truss, acknowledged that the UK owed the debt.