BRIT mum Nazanin Zaghari-Ratcliffe’s release from jail has been held up after Iran ramped its ransom bill by £100m, it has emerged.

Foreign Secretary Jeremy Hunt has secretly agreed to settle a 40 year-old debt to Tehran as the price to free the sickly dual national, who turned 40 on Boxing Day.

Nazanin, who has been in prison for more than two years, met with her daughter Gabriella when she was allowed a few days of freedom earlier this year Credit: Press Association Images

Richard Ratcliffe, husband of imprisoned Nazanin Zaghari-Ratcliffe, talks about their daughter Gabriella as Nazanin returned to prison in Iran

But The Sun can reveal that diplomats are now locked in a major haggle over how much interest should be paid on the £400m historical debt from a botched military deal.

A court ruled in 2010 that the UK owes Tehran the money after pulling out of an agreement to sell it 1,500 Chieftain tanks after the Shah was overthrown in 1979.

But sources have revealed that Iran is insisting that an interest rate of up to 8% is levied on the cash, pushing the total close to £500m.

Iran will next month haul the British government back to court in London as it mounts a renewed legal bid to enforce the payment.

Jeremy Hunt has branded the actions of the government in Tehran 'monstrous' Credit: PA:Press Association

A source said: “Our diplomats cannot agree a figure for the interest with Tehran, which is slowing everything down.

“Nazanin’s freedom is all intended to be part of a grand bargain, including the money for the tanks, but the Foreign Office is desperate not to make it look like that.”

The fresh blow for Nazanin’s campaigners came as she marked the landmark of 1,000 days behind bars yesterday.

Husband Richard Ratcliffe also used the grim anniversary to issue a fresh demand on the Foreign Secretary to ramp Britain’s protests.

Nazanin, pictured with husband Richard and daughter Gabriella, before she was imprisoned on spying charges Credit: Press Association Images

Husband of Brit mum Nazanin Zaghari-Ratcliffe tells of family's agony as she’s hauled back into Iranian prison

Mr Ratcliffe said: “We want two things to happen. This should go to the UN Security Council now. It’s not just Nazanin, there are many Britons and Americans being held by Iran.

“We should also raise it to the level of a formal dispute between Britain and Iran, which hasn’t happened yet. That would give Nazanin diplomatic protection.”

Mr Hunt stepped up the verbal pressure on Tehran yesterday by branding its actions as “monstrous” and “totally unjust”.

He also accused Iran of holding Brits like Nazanin prisoner as “a tool of diplomatic leverage”.

Nazanin's husband Richard has been campaigning tirelessly for the release of his wife Credit: Gary Stone - The Sun

Husband of Nazanin Zaghari-Ratcliffe speaks as aid worker is temporarily released from jail in Iran

The Foreign Secretary added: “Iran is a country which has a great civilisation behind it, one of the oldest civilisations in the world, they want to be respected by other countries - this is not the way to do it, to imprison an innocent woman like this”.

The Government has previously insisted international sanctions on Iran’s defence ministry made it impossible for a deal to be done.

But campaigners have insisted it could instead pay Iran’s central bank the money, which has already been set aside in a holding account.

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