Iran is loaning cash-strapped Cuba $26 Million.

The loan is part of a bilateral cooperation agreement between the two countries covering key areas such as banking, farming and biotechnology.

Cuba's state-run newspaper Granma Friday reported details of the agreement. 

The newspaper says Iran will offer Cuba assistance and equipment to help it fight the effects of a drought plaguing the eastern portion of the island.

In return, Havana will help Tehran build a biotechnology factory to produce hepatitis B vaccines and Cuban-engineered medicines to treat heart and kidney disease.

Iran's official news agency IRNA hailed Iranian-Cuban relations, and said the agreement paves the way for further joint economic cooperation between the two nations.

The United States has accused Iran of running a secret nuclear weapons program, and has recently tightened a long-standing economic embargo on Cuba.