REUTERS - President Hassan Rohani ordered his defense minister on Thursday to expand Iran's missile program, in response to a U.S. threat to impose sanctions over a ballistic missile test Iran carried out in October.
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"As the U.S. government is clearly still pursuing its hostile policies and illegal meddling ... the armed forces need to quickly and significantly increase their missile capability," Rohani wrote in a letter to Defense Minister Hossein Dehghan, published on the state news agency IRNA.
U.S. President Barack Obama's administration is preparing new sanctions against international companies and individuals over Iran's ballistic missile program, sources familiar with the situation said on Wednesday.
The current escalating dispute centers on the types of missile that the Islamic Republic is allowed to develop and whether they are capable of, or designed to, carry nuclear warheads.
"The defence ministry, with the support of the armed forces, is tasked with putting in place new programmes by all available means to increase the country's missile capability," Rohani said.
U.S. officials have said the Treasury Department retains a right under the nuclear deal to blacklist Iranian entities suspected of involvement in missile development.
Iranian officials have said the Supreme Leader, Ayatollah Ali Khamenei, would view such penalties as violating the nuclear accord. Earlier on Thursday, Iranian Foreign Ministry spokesman Hossein Jaber Ansari condemned the U.S. plans to impose additional sanctions as "arbitrary and illegal".
A team of UN sanctions monitors said in a confidential report seen by Reuters on Dec. 15 that the Emad rocket tested by Iran was a ballistic missile capable of delivering a nuclear warhead, making it a violation of a UN Security Council resolution.
The strategic Persian Gulf waterway, which sees nearly a third of all oil traded by sea pass through it, has been the scene of past confrontations between America and Iran, including a one-day naval battle in 1988.
The U.S. on Wednesday accused Iran of launching a "highly provocative" rocket test last week near its warships and commercial traffic passing through the Strait of Hormuz, exposing how tensions between the two countries could escalate even after a landmark nuclear deal.