State media in Russia has confirmed President Putin will lend around $5 billion to the Iranian government to back "promising projects" in the country.
As Iran emerges from sanctions, Russia has been one of the first to move on the country, which needs billions of dollars to build new railways, roads and marine ports.
Iran has become a focus for the construction industry in the Middle East following a slowdown caused by falling oil prices.
Russian Energy Minister Alexander Novak confirmed the loan this week and said it followed talks between President Vladimir Putin and Iranian President Hassan Rouhani three months ago.
Moscow and Tehran look set to work more closely and it was reported that Novak will visit Iran to talk about closer trade – with closer work on fuel production plants.
The report was not clear whether talks will take place within the framework of the existing Russian-Iranian Business Council.