Iran confirmed on Tuesday it was helping with the reconstruction of Afghanistan, even though it had originally denied reports it had given "bags of money" to its war-devastated neighbor.
On Monday, Afghan President Hamid Karzai said the country had received money from several "friendly countries" and specifically named the United States and Washington's diplomatic adversary, Iran, describing the money as a "transparent" form of aid.
Karzai said his office received sums up to 500,000-700,000 euros ($360,000-$975,000) once or twice a year from Iran and that he would continue to ask for Iranian money.
The New York Times, citing an unidentified Afghan official, said that millions of dollars in cash had been channeled from Iran in a bid to buy influence and loyalty and have been used to pay Afghan lawmakers, tribal elders and Taliban commanders.
In Tehran, the semi-official Fars news agency initially said on Monday that Iran's embassy in Afghanistan denied the New York Times report and described it as "baseless rumours" spread by some Western media.
On Tuesday, however, Foreign Ministry spokesman Ramin Mehmanparast said Iran had been helping with reconstruction efforts for some time.
"Iran, as a neighboring country, has helped a lot in order to reconstruct Afghanistan and that help was started by the former government," Mehmanparast said.
"Iran is helping Afghanistan and will continue in the future," he told reporters at a weekly news conference.
A former governor of a border province who says he was ousted for his criticisms of Tehran told Reuters this week that Afghanistan and its Western allies were dangerously underestimating Iran's destabilizing influence on the country.
A U.S. State Department spokesman did not question Iran's right to assist Afghanistan, but questioned Tehran's motives, given its history of playing a "destabilizing role with its neighbors."
Iran has wide and growing influence in Afghanistan, especially in the west of the country, where it has important economic ties around the commercial hub of Herat.
Tehran denies supporting militant groups in Afghanistan and blames the instability on the presence of Western troops, just as it has done in Iraq.