Did Iran 'secretly' sign a €500 million deal with Russia? Why Verba air defence system is in focus amid tension with US?

Iran has agreed to a 500 million euros arms deal with Russia in one of its most significant moves to rebuild its air defence system destroyed during the brief conflict with Israel last year, in which the US participated.

According to a report by the Financial Times, Iran and Russia signed the arms deal in December last year, months after the attacks destroyed its key air defence facilities.

The deal commits Moscow to deliver 500 man-portable “Verba” launch units and 2,500 “9M336” missiles, as per leaked Russian documents cited by FT and several people with knowledge of the deal.

Verba particularly gains attention in the deal, as it is one of Russia's most modern air defence systems.

Under the Verba contract, worth 495 million euros, deliveries of the launch units are scheduled in three tranches, starting from 2027 to 2029. According to FT, citing a person familiar with the transaction, Russia may have possibly delivered a smaller number of the systems to Iran ahead of schedule.

The news comes as the United States continues to strengthen its military presence in the region, sparking concerns about a potential broader conflict with Iran.

Fresh negotiations between the United States and Iran will be held in Geneva on Thursday, Oman's Foreign Minister Badr Al Busaidi confirmed amid escalating tensions between the two countries.

How did Iran ink the deal with Russia?

According to a contract cited by FT, Iran formally requested the weapons in July last year, days after its 12-day conflict with Israel in which three of the country's key nuclear facilities saw damage amid a US intervention.

During that time, Tehran's integrated air-defence network suffered heavy blows, enabling Israel to rapidly establish and sustain air superiority over major parts of Iran.

According to a former US official cited by FT, the deal would likely have been viewed by Moscow as a way to re-establish its ties with Iran after it suspiciously failed to back its ally during the conflict.

“They want Iran to remain their partner. And so even if they can’t react in the middle of a crisis, they’re going to look after the crisis to try to patch up the relationship,” he said.

The Verba deal between Moscow and Tehran was executed by the Kremlin’s state arms export agency Rosoboronexport, and the Moscow representative of Iran’s Ministry of Defence and Armed Forces Logistics, known as MODAFL. Ruhollah Katebi, a Moscow-based MODAFL official, helped arrange the deal.

What is the Verba air defence system?

The Verba is one of Russia's most modern air defence systems. It is a shoulder-fired, infrared-guided missile and is a man-portable air defence system. Verba has been manufactured by the state defence enterprise KBM and has been in service with Russia since 2014.

Verba is capable of targeting cruise missiles, low-flying aircraft and drones.

Small mobile teams can operate it, allowing ground forces to rapidly create dispersed defences without relying on fixed radar installations that are more prone to strikes.