Iran and the US have conducted a prisoner exchange in a rare diplomatic breakthrough between Tehran and Washington after months of tensions.

In a trade conducted in Zurich, Switzerland, Iranian officials handed over Chinese-American graduate student Xiyue Wang, detained in Tehran since 2016, for scientist Massoud Soleimani, who had faced a federal trial in Georgia.

While the exchange represents a rare win for both countries, it comes as Iran still faces crushing American sanctions and the aftermath of nationwide protests that reportedly saw more than 200 people killed.

Massoud Soleimani
Iran’s foreign minister Mohammad Javad Zarif, left, with Massoud Soleimani prior to leaving Zurich for Tehran (Javad Zarif/Twitter/AP)

Meanwhile, Western detainees from the US and elsewhere remain held by Tehran. They are likely to be used as bargaining chips for future negotiations amid Iran’s unravelling nuclear deal with world powers.

Mr Wang’s release had been rumoured over recent days, with one lawyer involved in his case tweeting a Bible verse about an angel freeing the apostle Peter just hours before Iranian foreign minister Mohammad Javad Zarif broke the news,

Mr Zarif said on Twitter: “Glad that Professor Massoud Soleimani and Mr Xiyue Wang will be joining their families shortly. Many thanks to all engaged, particularly the Swiss government.”

Shortly afterwards, President Donald Trump shortly acknowledged Mr Wang was free in a statement from the White House, saying the Princeton scholar would be “returning to the United States”.

He said: “Mr Wang had been held under the pretence of espionage since August 2016. We thank our Swiss partners for their assistance in negotiating Mr Wang’s release with Iran.”

Hua Qu
Xiyue Wang’s wife Hua Qu, pictured in May 2018, welcomed his release (Matt Rourke/AP)

The Swiss Embassy in Tehran looks out for America’s interests in the country as the US Embassy there has been closed since the 1979 student takeover and 444-day hostage crisis.

Brian Hook, the US special representative for Iran, accompanied Mr Soleimani to Switzerland to make the exchange and will return with Mr Wang.

Mr Wang will first be taken to Landstuhl hospital near Ramstein Air Base in Germany for a medical check-up.

Mr Soleimani is expected to return to Iran within hours of the swap, and Mr Zarif has tweeted photos of himself with the scientist in front of an Iranian government jet.

Mr Wang’s wife Hua Qu released a statement saying “our family is complete once again”.

She added: “Our son Shaofan and I have waited three long years for this day and it’s hard to express in words how excited we are to be reunited with Xiyue.

“We are thankful to everyone who helped make this happen.”

Mr Soleimani – who works in stem cell research, haematology and regenerative medicine – was arrested by US authorities on charges he had violated trade sanctions by trying to have biological material brought to Iran. He and his lawyers maintain his innocence.