ISW warns reported $300 billion Iran package could fund military rebuilding

Baghaei, Iran’s Foreign Minister spokesman, defended the expenditures, saying military programs were necessary to counter perceived threats facing Iran.

By Vered Weiss, World Israel News

The Institute for the Study of War (ISW) warned Tuesday that economic relief provided under a reported Memorandum of Understanding (MoU) could allow Iran to rapidly rebuild its military capabilities, citing statements from Iranian officials indicating that funding has been used for missile and drone programs.

In its assessment, the ISW said the reported agreement could provide Tehran with resources that may be used to restore military assets.

The organization noted previous comments by Iranian officials regarding defense spending priorities.

The assessment comes amid reports of a conditional $300 billion investment package backed by Gulf States.

The package is reportedly tied to Iran dismantling its nuclear program and does not involve direct funding from the U.S. government.

Previously, President Donald Trump rejected reports describing the package as a U.S.-backed initiative, calling claims that the United States would provide $300 billion to Iran “fake news.”

However, the $300 billion package is mentioned int the 14-point memorandum of understanding released on Wednesday.

The ISW cited comments made by Iranian Foreign Ministry Spokesperson Esmail Baghaei in May addressing criticism of Iranian spending on military programs.

“I think even the stones of Mina would be moved to tears upon hearing such absurd statements from American officials, who, after nearly 73 years of hostile actions against the Iranian people, still claim to care about them and pretend to be upset because, in their view, Iran’s money has been spent on missiles and drones…”

Baghaei defended the expenditures, saying military programs were necessary to counter perceived threats facing Iran.

“Of course, we spend part of Iran’s money on missiles and drones, because if we did not, our enemies would have been able to achieve their ambitions, as we have repeatedly seen over the past few months…”

The ISW assessment highlighted the remarks as evidence that Iranian officials have publicly acknowledged directing state resources toward missile and drone development.

The reported investment package remains conditional on nuclear-related commitments, while questions continue over how future economic relief could affect Iran’s military capabilities.

The ISW said Iranian officials’ statements indicate that at least some financial resources have previously been allocated to missile and drone programs.

Trump, meanwhile, has continued to dispute reports describing the package as direct U.S. funding for Iran, maintaining that such claims are inaccurate.