* Gabriel says Germany wants to help Iran with reforms
* Siemens to supply components for 50 locomotives in Iran
* Exports to Iran up 15 pct in first half, trade still
(Recasts with Siemens deal, adds bullet points)
By Gernot Heller
TEHRAN, Oct 3 Germany's Siemens
signed a contract to upgrade Iran's railway network on Monday,
one of several deals agreed by German firms during a two-day
visit to Tehran by Economy Minister Sigmar Gabriel.
Gabriel has flown to Iran with a planeful of 120 managers
who are keen to re-establish business relations with the Islamic
Republic after it reached a landmark deal with world powers last
year to scale back its disputed nuclear programme.
But political concerns, and a range of U.S. sanctions still
in place, have so far held back a hoped-for business boom.
Siemens said it will supply components for 50
diesel-electric locomotives to Iran. It did not disclose the
value of the contract, but based on comparable deals, it could
be in the low hundreds of millions of euros.
The economy ministry said several firms from the
Mittelstand, the small-to-medium-sized companies that form the
backbone of the economy, had also signed deals with Iranian
partners. These included SMS group, a builder of steelmaking
plants, and INTRA industrial solutions.
In addition, Mitsubishi Germany has signed a contract to
modernise a gas-fired plant, while plant constructor Keller HCW
wants to build a brickyard in Iran, it said. Both countries'
central banks have also agreed to technical co-operation.
There was no detail on the size of the agreed deals.
Iran's Deputy Economy Minister Mohammad Khazaei said earlier
that 10 economic agreements would be signed on the sidelines of
Gabriel's visit. "I hope that this will smooth the way between
both countries," he said.
Germany, which has commercial and cultural ties with Iran
that go back to the 19th century, was for decades a major
trading partner of Tehran before the sanctions allowed China and
several other nations to overtake it.
While industrial firms such as Siemens are keen to benefit
from opportunities in Iran, Gabriel has warned Tehran that to
normalise ties it must accept Israel's right to exist and stop
what he called Iran's decisive role in the Syrian civil war,
where it has intervened to support President Bashar al-Assad
against Western-backed rebels.
The German banking sector has been reluctant to underwrite
business deals for fear of falling foul of remaining U.S.
sanctions imposed on Iran for what Washington says is Tehran's
money laundering, support for terrorism and human rights abuses.
Gabriel said earlier that Germany wants to help Iran push
ahead with reforms, and promised to remind the United States of
its commitment to reduce sanctions against Iran.
He also said that Iran was a reliable credit partner that
kept agreements as a rule.
German exports to Iran jumped 15 percent in the first half
of the year to 1.13 billion euros and could reach 4 billion
euros in the full year, said Michael Tockuss, head of the
Hamburg-based German-Iranian Chamber of Commerce.
(Additional reporting by Christoph Steitz in Frankfurt; Writing
by Caroline Copley; Editing by Mark Trevelyan)