WASHINGTON: Iran will receive $4.2 billion from blocked overseas funds and about $7 billion of benefits from sanctions relief for concluding an interim nuclear deal with the P5+1 countries, US officials said on Monday.

The first instalment of $550 million will be released on Feb 1 and the rest will in six instalments. The entire fund, blocked in the West due to a nuclear dispute with the West, will be transferred to Iran by July this year.

The sanctions relief will also bring $7 billion of benefits to Iran, over the next six months.On Sunday, Iran and the P5+1 countries — the United Kingdom, France, Germany, Russia, and China — concluded an agreement which requires Iran to start eliminating its uranium stockpile from Jan 20 and complete the process in six months.

In return, the P5+1 nations will begin to implement modest relief so long as Iran fulfilled its obligations and the two sides pursued a comprehensive solution to Iran’s nuclear programme.

On Sunday, US President Barack Obama described the agreement as an “important step forward”, which could lead to “a comprehensive resolution that addresses our concerns over Iran’s nuclear programme”.

President Obama also criticised a bipartisan move in the US Congress to tighten sanctions on Iran and promised to veto all such moves.

“Imposing additional sanctions now will only risk derailing our efforts to resolve this issue peacefully, and I will veto any legislation enacting new sanctions during the negotiation,” he said.

At a special briefing, three senior officials of the Obama administration explained that Sunday’s agreement starts the implementation of a joint plan of action reached in Geneva on Nov 24.

Under the agreement, Iran will halt the progress of its nuclear programme and roll it back in key respects and in the next six month, the two sides will negotiate a comprehensive resolution to this issue.

On Jan 20, a UN nuclear watchdog, the International Atomic Energy Agency, will report on the current status of Iran’s nuclear programme.

From Jan 20, Iran will stop installing or feeding additional centrifuges and will halt over 5 per cent enrichment. Iran will also stop production of the 20 per cent enriched uranium and to disconnect the cascades which have been connected together in tandem to efficiently produce 20 per cent enriched uranium.

On the first day, Iran will also start to dilute half of the 20 per cent enriched uranium that it now has in gaseous UF6 form, and would continue convert the rest of its UF6 to oxide. This will end further enrichment.

On Jan 20, Iran will also provide to the IAEA all the information it needs to monitor Iranian nuclear facilities, include those kept out of the agency’s reach so far. This will include the centrifuge assembly workshops and centrifuge rotor production workshops.

The IAEA will be responsible for verifying and confirming all of the nuclear-related measures consistent with its broader safeguards verification role.

In addition, the P5+1 and Iran will be setting up a joint commission that will work with the IAEA to monitor implementation of the Joint Plan of Action and to facilitate resolution of past and present concerns about Iran’s nuclear programme.

The agreement also requires the United States to refrain from imposing new nuclear-related sanctions.