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Iran to Increase Defense Expenditures

Iran is going to increase its military spending because of heightened tension in the region, Defense Minister Ali Shamkhani said Wednesday.

President Mohammad Khatami confirmed the government's emphasis on defense when he presented Iran's budget for the new fiscal year to parliament on Wednesday.

"Upgrading [Iran's] military capability and deterrence ... expanding and reinforcing military industries to achieve new technologies, have been given priority in the draft budget," Khatami said. His speech was carried live on state radio.

Iran lies between two countries that are theaters of conflict or potential conflict — Iraq to the west and Afghanistan to the east. The United States has threatened to invade Iraq to force it to obey U.N. resolutions to disarm. Afghanistan's Taliban government was ousted by U.S.-backed forces last year and sporadic fighting continues there.

Neither Khatami nor the defense minister gave figures for the defense allocation in the budget of $107 billion for the fiscal year beginning March 21, 2003.

"My ministry has made certain proposals [on increasing the defense budget]," Defense Minister Ali Shamkhani told reporters, without elaborating.

Shamkhani said Iran was "making efforts to use its missile technology to place a satellite in orbit." He denied claims by Iranian exiles that the country was developing a new surface-to-surface missile — known as Shahab-4.

The minister refused to confirm or deny U.S. intelligence reports that Iran had modified its Shahab-3 missile to increase its range. He said Iran employs all its technical capabilities to "meet our defense requirements within international regulations."

In October, a U.S. defense official said that Iran tried in July to extend the range of its Shahab-3 missile, but the attempt failed because the missile did not function properly. The normal version of the missile can fly about 800 miles, which is enough to reach Israel.

The Shahab-3 is based on North Korea's No Dong missile, U.S. officials say.

Iran launched an arms development program during its 1980-88 war with Iraq to compensate for weapons shortages caused by a U.S. embargo. Since then, Iran has produced its own tanks, armored personnel carriers, missiles and a fighter plane.