Iran hasagreed to donate $25 million to Turkey's ruling Justice and Development Party (AKP) in order to support Prime Minister Recep Tayyip Erdogan's next election campaign, the British Daily Telegraph reported Tuesday.
Diplomatic elements told the newspaper that some $12 million have already been transferred to the party while the rest of the sum will be given by the end of the year.
The report comes just days after Erdogan scored a landslide victory in a referendum ona reform in Turkey's constitution. Turks approved constitutional clauses bolstering the Islamic government at the expense of the court and army, two secular institutions.
Following the victory, Erdogan announced he plans on running for a third term as prime minister, a first in Turkish history.
According to the Daily Telegraphy, the Turkish government denied having received the money from Iran.
Omer Celik, deputy chairman of the AKP told Turkish paper Haber that the British report is completely groundless and based on lies. He demanded that the Daily Telegraph correct the report and issue an apology. "Should they not, we reserve the right to turn to international courts," he said.
The British report states that Western diplomats fear that the AKP's deal with Iran will heighten fears among Turkish secularists that Erdogan will exploit the government's new powers to drive through the AKP's radical Islamic agenda.
"The agreement between the AKP and Iran is a very worrying development," a senior Western diplomat said. "It will increase the suspicions of many Turks that the government is deepening its ties with Islamic states.
Relations between Ankara and Tehran have warmed considerably since Israel's Operation Cast Lead in Gaza. Erdogan objected to international sanctions on Iran and initiated a uranium swap deal togetherwith Brazil which was rejected by the West.
Meanwhile, Turkey's relations with Israel are in the midst of a crisis, heightened by the raid onthe Gaza-bound flotilla.
Diplomats also say that apart from transferring funds to the AKP, Iran has also agreed to provide financial support for the IHH, the Turkish Islamic charity IHH which supported the flotilla.