Iraqi Prime Minister Ali Al Zaidi was in Iran on Thursday as part of a regional tour aimed at boosting economic and political ties, paying his first visit to Tehran since taking office in May.
The visit comes at the invitation of Iranian President Masoud Pezeshkian, who welcomed him in Tehran.
Mr Al Zaidi announced the establishment of an Iraqi-Iranian Joint Economic Committee following talks with Mr Pezeshkian. The two countries also signed several joint agreements concerning issues such as foreign affairs, finance, the economy, and energy.
Mr Al Zaidi said the agreement reflects "the depth of the relationship between Iraq and Iran" and called for joint investments in various fields.
“Iraq and Iran are bound by historic and civilisational ties, shared borders, and common interests. These enduring bonds call for continued engagement in a spirit of dialogue, co-operation, and mutual respect in a manner that promotes sustainable development for both countries,” Mr Al Zaidi said before leaving Baghdad.
As the visit proceeded, explosions were reported near the Abdali border crossing on the Iraq-Kuwait frontier near Basra. Kuwait's Ministry of Defence said the crossing came under attack by "hostile" drones, causing damage but no casualties.
Upon arrival, Tehran hosted a large ceremony for Mr Al Zaidi with national anthems of both countries played. Mr Al Zaidi then held talks with Mr Pezeshkian.
Mr Al Zaidi’s visit to Tehran will focus on discussions about trade, transportation, agriculture and water, Iraqi government spokesman Haider Al Aboudi said in a statement.
Mr Al Aboudi also said “Iraq is pursuing an initiative based on diplomatic solutions, particularly regarding current regional developments.
“The gas file will also be on the table for bilateral discussions between Iraq and Iran.”
Last week Mr Al Zaidi met US President Donald Trump in Washington in what was described as a successful visit that resulted in the signing of dozens of trade and economic deals.
For years, Iraq has balanced ties between the US and Iran, its two main allies with powerful influence in the country.
Baghdad has come under increasing US pressure since the Iran war broke out in February to rein in militia groups aligned to Tehran. Mr Al Zaidi has vowed to crack down on corruption and to bring armed groups under state control, tying a September 30 deadline to the withdrawal of US troops from Iraq.
The trip to Tehran comes after the US intensified its bombing campaign against Iran last week. In response, Iran has targeted military bases that it says are used by US forces in several countries across the region including in the Kurdistan region of Iraq.
An adviser to Mr Al Zaidi has said Iraq could be a door to the West for Iran, while reports suggest Mr Al Zaidi has offered to play a mediating role between the US and Iran.
After Tehran, Mr Al Zaidi is expected to travel to Turkey and Saudi Arabia at the end of the month. Discussions with Turkey will focus on the water issue, according to Mr Al Aboudi.
Scarce water resources in Iraq have long been an issue between the two countries. Around 70 per cent of Iraq's water flows from neighbouring countries, especially via the Tigris and the Euphrates rivers. Both flow through Turkey and Iran.
Turkey and Iran have significantly reduced flows into the Tigris and Euphrates in recent years.
