"Relations with Egypt must now be restored," Asefi said (AFP)

TEHRAN, January 6 (IslamOnline.net & News Agencies) – Iran and Egypt have agreed on resuming full diplomatic ties and an official announcement would be made in a day or two, reported Al-Jazeera television Tuesday, January 6.

Quoting an official source in the Iranian leadership, the Qatar-based broadcaster said the two governments also agreed on re-opening their embassies.

This came hours after the Tehran city council renamed as “Intifada” the street previously named after the assassin of late Egyptian president Anwar Sadat.

"Relations with Egypt must now be restored, because this will help the Palestinian people and this is the wish of all Palestinian groups, notably the Jihadi groups," Iranian Foreign Ministry spokesman Hamid Reza Asefi was quoted as saying by Agence France-Presse (AFP).

The two heavy-weight Muslim countries severed diplomatic ties in 1980, a year after Cairo gave asylum to the deposed shah, Mohammad Reza Pahlavi, and signed a peace treaty with Israel.

Relations were particularly bad when Egypt supported Iraq during its 1980-1988 war against Iran.

However, trade and other ties have been improving since the 1990s.

Major Obstacle Removed

Mubarak (L) meets Khatami (AFP)

Tehran city council agreed earlier Tuesday to rename the street bearing the name of Sadat’s killer, removing a major obstacle to renewing ties with Cairo.

The council passed a resolution asking for the name of Khaled Eslamboli Avenue, in the center of the capital Tehran, to be changed, meeting one of Egypt's main demands for restoring diplomatic relations.

After Sadat was assassinated at a military parade in 1981, Iran's revolutionary leadership named a street after Eslamboli.

A large mural of Eslamboli, recognized as a martyr for his opposition to Egypt's peace deal with Israel, also features on a towering building on the busy city center street.

The council noted that the decision had already been taken some two years ago to rename the street Intifada Avenue, but an official request was being awaited from the foreign ministry, which was only recently made.

Asefi had told the council in that letter that there was need for a "positive initiative on the part of the Islamic republic" toward Egypt in light of the "new regional situation, positive signals on the part of the Egyptian leadership and circumstances favorable to the development of bilateral relations."

"We now consider that the conditions have now been met" for restoring full diplomatic relations, said the spokesman Tuesday.

Asefi also praised comments by Egyptian Foreign Minister Ahmed Maher that the 1978 Camp David peace deal with Israel was "merely a thing of the past".

In an interview with the official Iranian news agency IRNA published Monday, January 5, Maher termed the recent talks between Egyptian President Hosni Mubarak and Iranian counterpart Mohammad Khatami as "very important".

The two leaders met in December 2003 on the sidelines of a U.N. technology summit in Geneva, and Mubarak was invited to attend a D-8 economic summit of developing nations Iran in February 2004.

"Iran and Egypt are now preparing the ground to cement their relations, and these efforts must continue," Maher said.