Tensions between Iran and Israel mounted this week as Iranian President Mahmoud Ahmadinejad unveiled a new short-range ballistic missile.

The president said the improved Fateh-110 surface-to-surface missile, which was tested in recent weeks, was developed “not in an aggressive context, but as a deterrence”.

Iran’s official IRNA news agency said that the upgraded weapons has a quicker launch capability, longer life and improved accuracy to strike land and naval targets within 298 kilometres.  

“We do not seek progress in the defence industry for conquest,” said Ahmadinejad. “We want it to defend ourselves, our territory, our existence.”

The announcement comes amid increased speculation that Israel is planning to launch an attack on Iran’s nuclear facilities, which Tel Aviv claims are being used to develop nuclear weapons.

Israeli Prime Minister Benjamin Netanyahu has threatened military action against Iran, while one US blogger recently published what were claimed to be Israel’s official plans for a strike.

Iran claims to have the capability to strike US bases in the Gulf region if it comes under attack.

Tehran also announced it had started the construction of an air defence site in the south of the country, close to its Isfahan uranium enrichment facilities.