In the talks held yesterday, the governments also discussed the possibilities for private sector participation in the building electric power generating capacity.

The moves on the hydro sector come as the governments explore ways to cooperate in the electricity and water sectors.

The talks in Ankara resulted from an invitation to Iran from Turkey, and the Iranian government is keen to strengthen economic ties with its western neighbour, which hopes to join the European Union (EU). Iran has invited the Turkish government to continue the bilateral talks in Tehran.