Bolivia's lucrative relationship with oil-rich Iran has been thrown into jeopardy amid a developing row over the expulsion of a senior Iranian minister allegedly implicated in terrorism events in Argentina.

Iranian Defense Minister Ahmad Vahidi flew out of Bolivia after a La Paz request that he leave the country to avoid diplomatic complications over an Interpol arrest warrant issued at Argentina's request.

Vahidi is accused by Argentina of responsibility for a 1994 terrorist attack that targeted the Jewish community in Buenos Aires, leaving 85 people dead and more than 300 injured. Iran denies any role in the attack.

Vahidi's unceremonious departure put at risk deals that followed Bolivia's courting of Iran, including a $1.2 billion credit on easy terms, defense supplies and projected collaboration in the developing of Bolivia's uranium mines and other natural resource deposits.

Bolivian officials repeatedly stated their intention to benefit from Tehran's experience in mining exploration and development and Iran's extensive experience with small arms industries, armor manufacture and recent advances in aircraft assembly and manufacture. Bolivia gave Iran preference over what it called untrustworthy Western business and defense partners.

Bolivian President Evo Morales turned to Iran, which he considered a like-minded, anti-imperialist state, after turning down or turning off potential investors from North America and Europe.

Officials haven't said how the Iran connection has progressed since it became public after President Mahmoud Ahmadinejad visited the country in 2007. Several exchange visits followed that opening of full diplomatic relations.

Iran denies Vahidi had any role in the 1994 terrorist incidents in Buenos Aires. After Argentine representations, however, Interpol issued warrants for the arrest of Vahidi, a former Revolutionary Guard commander, and five other Iranians and a Lebanese national. Interpol received Argentine alerts as Vahidi's latest visit to La Paz came to light.

In the uproar that followed, Argentine Foreign Minister Hector Timerman directed an Argentine attorney to formally request Vahidi's arrest. Bolivia promptly asked Vahidi to leave the country and sent out a formal apology to Argentina over the visit, further complicating the exchanges that followed and the future of its ties with Iran.

Timerman went public via Twitter with what he said was a Bolivian government letter stating, "The Bolivian government has already taken the necessary measures to make sure that Mr. Ahmad Vahidi immediately leaves Bolivian territory, proving that Bolivia does not wish to interfere in any way with any existing procedures regarding his legal situation."

Bolivian Foreign Minister David Choquehuanca said in the letter that "due to this regrettable incident, I would like to express on behalf of my country how much we appreciate the Argentine government's cooperation in order to leave this situation behind. Even though it represents a grave diplomatic incident, it only came to pass because his attendance was unknown to some of us, and in no way we intended to hinder the excellent Argentine-Bolivian relations."

"Unfortunately (the Bolivian Defense Ministry) did not know about the background of the case" nor did the Foreign Affairs ministry coordinate the invitation with the rest of Bolivia's government, said the letter.

Vahidi's presence in the country was not announced by the Bolivian Foreign Ministry or the Ministry of Defense as he took part in the anniversary celebrations of the Military Aviation School in Santa Cruz de la Sierra. Later, Vahidi addressed reporters, triggering a strong reaction from the Argentine Jewish community.

Iran's state news agency IRNA said Vahidi visited Mauritania before arriving in Bolivia at the invitation of his counterpart, Maria Cecilia Chacon, who took office as defense minister in April.

Interpol's warrant for Vahidi's arrest dates to 2007, when he was still deputy defense minister in Ahmadinejad government. In August 2009 Vahidi was promoted to the defense portfolio as a full minister.

Before the latest diplomatic controversy, Iranian defense ministry officials sent numerous delegations to Bolivia to discuss a range of defense contracts, including aircraft for the Latin American country.