Under 'Maximum Pressure', Iran Turns To China And Russia

As the Trump presidency slides into the sunset, a review of its approach to Iran reveals an unrelenting pursuit of economic sanctions, impelled by a visceral animosity for the Iranian leadership and its people, indeed, for the Iranian revolution itself.

Throughout the election campaign, Trump had criticized the Joint Comprehensive Plan of Action (JCPOA), the formal title of the nuclear agreement that the P5+1 powers had entered into with Iran to curb its weapons programme and ease sanctions. Anxious to reverse every achievement of the former president, Barack Obama, Trump had promised a “better” deal.

A year after entering the White House, Trump formally withdrew the US from the JCPOA in May 2018 and reinstated sanctions on the country. Trump’s idea of a “better” deal envisaged a significant expansion of the issues to be covered by a new agreement – curbing Iran’s support for terrorism and the regional instability caused by its “malign” actions and, specifically, ending its development of ballistic missiles and cutting off ties with Hamas and Hezbollah.

“Maximum pressure”

As Iran failed to respond to these demands, the sanctions became more severe: Trump demanded that Iran’s oil exports be reduced to zero, even as the sanctions curbed Iran’s access to global financial institutions. Over the last four years, new sanctions have been imposed on Iran practically every week – targeting its leaders and institutions. Besides the oil and finance sectors, sanctions have been imposed on the Iranian Revolutionary Guards Corps (IRGC), the Central Bank of Iran, and recently its oil companies, several of its banks, the Iranian Oil Minister and even the Iranian ambassador in Baghdad.

These sanctions have been accompanied by “secondary” sanctions directed at individuals and organisations that engage with Iran. This has ensured that, regardless of the official positions of the governments concerned, their financial and corporate institutions would not deal with Iran for fear of losing access to US markets.

The administration described these sanctions as imposing “maximum pressure” on Iran, but the objective of the sanctions was never clear. Initially, US officials said that the pressure would encourage Iran to return to the negotiating table to discuss the new matters placed before it. As Iran declined to accept these blandishments, the real objective revealed itself – regime change, the long-cherished desire of several US administrations since the 1979 Islamic revolution.

The idea now was that, being crushed under the crippling sanctions, the Iranian people would rise against their leaders, forcibly overturn the Islamic revolution, and usher in a new era of freedom and democracy under American auspices. The White House even announced that a special office had been set up to oversee and back this change – by encouraging organized dissent in the population, particularly disgruntled minorities – Baluchis, Kurds, Azeris and Arabs.

As recently as August this year, Trump appointed Elliott Abrams as his new envoy for Iran. A former UN diplomat Jim Paul has described the appointment thus: “For decades, Abrams has been a leading figure in Washington associated with organizing and promoting US intervention. … He is a hawkish Neocon ideologue who can be expected to launch regime-change initiatives against Iran."

A year after entering the White House, Trump formally withdrew the US from the JCPOA in May 2018 and reinstated sanctions on the Iran. Source: AP File Photo

Despite periodic anti-government demonstrations in Iran over the last two years, the sanctions have not brought about regime change, nor have they brought Iran to the negotiating table. But they have certainly had a chilling affect on the economy. For the fiscal year ending March 2021, the GDP is expected to decline by 6 percent, according to the IMF; earlier, from a high of a 12.3 percent growth in 2014, the GDP had fallen by 8.3 percent in 2019.

The national currency, the rial, has reached record lows, and now stands at 42,000 rials to the dollar. Inflation has been rising every month – by 30 percent in August and 34 percent in September. Oil production now stands at 1.9 million barrels per day (mbd), half of what it was three years ago. Oil exports of about 650,000 barrels/ day have brought in a paltry $ 5 billion in revenues. In 2018, oil production had been 3.8 mbd, while exports had been 2.3 mbd.

Arms embargo

To make it difficult for the new administration to ease these sanctions, the Trump administration has placed some of the sanctions under counter-terrorism authorities: these include Iran’s energy, petrochemicals and metals sectors. Oil Minister Bijan Zanganeh has dismissed the US’ recent sanctions as a “passive reaction” to its failure to bring Iranian oil exports to zero. Foreign Minister Javad Zarif spoke of the US’ “addiction” to sanctions, while the American national security adviser Robert O’Brien said that the US had “out-sanctioned its ability to pressure Iran”.

Over several months before the UN arms embargo on Iran would expire in October this year, the US began insisting that it would pursue a “snapback” of the embargo which is provided for in the JCPOA for violations of the nuclear agreement. On 20 August, Secretary of State Mike Pompeo notified the UN Security Council (UNSC) that the indefinite extension of the embargo would be triggered in a month’s time.

Iranian Oil Minister Bijan Zanganeh  has dismissed the US’ recent sanctions as a “passive reaction” to its failure to bring Iranian oil exports to zero.

This initiative was not accepted by other signatories to the JCPOA on the ground that the US, having withdrawn from the JCPOA in 2018, was no longer a “participant” in the agreement and thus not authorized to pursue any matter under the agreement. This view was upheld in the UNSC, with the US getting only one vote in support, besides its own. Despite this, a month later, the US declared that all sanctions on Iran had been reinstated, and that any individual or organization violating the arms embargo would face US sanctions.

On October 19, Iran celebrated the lifting of the 13-year UN arms embargo. Javad Zarif described it as a “momentous day for the international community”, while the foreign office said Iran would “procure any necessary arms and equipment from any source” to meet its defensive needs. It added that Iran would also “export defensive armaments based on its own policies”, raising fears in the US that Hezbollah, declared a terrorist organization by the US, would be a major beneficiary.

Though the arms embargo may have been lifted, there are still severe constraints on Iran’s ability to make major purchases, the most important being its difficult financial position and the US sanctions that are likely to deter potential suppliers. Not that Iran is without assets of its own: due to the long sanctions regime it has endured, it is particularly proficient in upgrading the weaponry that it already has with selective imports of spare parts, motors and technologies. Russia is likely to be a major partner in this regard.

Turning to Russia

There is much that brings Iran and Russia together. The Eurasian space is enmeshed with the ideological, geopolitical and geo-economic interests they share: both are committed to regional stability, share concerns relating to Islamic extremism and seek to limit US-led NATO incursions into the Gulf and the Eurasian area. Ideologically, both uphold state sovereignty and non-interference in domestic affairs by external powers, and fiercely oppose externally-sponsored regime change. They also support a multi-polar global order that is anti-hegemonic and provides greater scope for non-western nations to pursue their interests.

The London-based scholar Ghoncheh Tazmini points out that “a shared understanding of the international order translates into a shared understanding of the security environment”. There are several aspects of their geography that unite them. From the Russian perspective, Iran links India with the Gulf and the Eurasian landmass, a view that Iran shares about its own geopolitical significance. This is most clearly realised in the International North-South Transport Corridor (INSTC) that is envisaged as a multi-modal (rail, road and shipping) link from South Asia to Moscow, via the Iranian port of Chabahar.

Another area for Russo-Iranian cooperation is the Caspian Sea. The sea, which has five littoral states – Iran, Russia, Kazakhstan, Turkmenistan and Azerbaijan – also brings Iran into the Eurasian strategic space. The August 2018 ‘Convention on the Legal Status of the Caspian Sea’ signed by the littoral states has successfully addressed long-pending issues pertaining to navigation rights, construction of pipelines, environmental matters and presence of non-Caspian forces, though consideration of issues relating to the delimitation of the seabed and subsoil has been deferred. This agreement will promote land and sea connectivity and wider regional access.

The best example of Russo-Iranian cooperation is Syria. Here, for the last five years the two countries have coordinated their interests and approaches to secure the Assad government from externally-sponsored regime change, fight jointly against extremist forces and promote the unity of the country despite the aspirations of the Kurds, the intrusive role of Turkey, and the hostility to their agenda from the US. Iran has also shown understanding of Russia’s larger interests in the region, including addressing the security interests of Israel, and has generally gone along with Russian actions in this regard.

Russia has been Iran’s defence partner since the 1960s, the partnership being accelerated from 2003 when Russia signed contracts to supply combat training aircraft and later, the S-300 air defence system which, due to sanctions, was finally delivered only in 2016-17. In fact, concerns relating to massive supplies of Russian weapons to Iran were the avowed motive for the US to seek the extension of the arms embargo. In November 2019, the US defence department had warned that, following the end of the embargo, Iran would enhance its modern conventional capabilities with fighter jets and main battle tanks.

Since then reports have proliferated about Russian-Iranian defence cooperation: in August this year, the US Defence Intelligence Agency said Iran would be purchasing the S-400 missile system, Su-30 jets, coastal defence missile systems, and T-90 tanks. There are also reports that Iran has offered Russia the use of three naval bases on its Gulf coast, with the Iranian naval chief saying that joint exercises are planned in the Caspian Sea and the Gulf. As of now, these appear to be speculations of various commentators and no firm deals have been finalised so far.

According to Russian commentators, Iran is generally self-sufficient in most areas, though it needs to modernise its air force and obtain spare parts and technologies to pursue its own development programmes; these include aircraft and tank engines. Given Russia’s interest in sustaining ties with Israel and the Gulf Arab states, there is some doubt about how far Russia will go in re-arming Iran, so that both Iran and Russia are likely to agree to focus on building Iran’s own production capacity rather than buy the latest equipment, which will raise regional concerns.

Iran’s outreach to China

There is similar drama, shrouded in ambivalence, surrounding the possible fleshing out of the China-Iran “comprehensive strategic partnership” agreement that had been signed during the visit to Tehran of Chinese President Xi Jinping on 22-23 January 2016.

In September 2019, the journal, Petroleum News, gave some details of a “final draft” of a 25-year Sino-Iranian partnership agreement that included Chinese investment of $ 400 billion in Iran’s hydrocarbon and petrochemicals sectors and the development of its infrastructure and industry. In return, Iran would give China a 32 percent discount on oil supplies. The report added that 5,000 Chinese troops would be deployed to protect the Chinese projects.

Later, Iranian websites carried texts of an 18-page “final draft”, perhaps finalised in May-June this year, that did not refer to the figures contained in the Petroleum News story, but mentioned how Iran would be integrated into the BRI projects. These include: Iran’s gas exports to Pakistan and China through transnational pipelines, joint Iran-China energy projects in Iraq, and Iran-China projects to build electricity plants in Iraq, Pakistan, Afghanistan and Syria.

On 11 July, the New York Times (NYT) published further details of the so-called “final draft” agreement. Besides various Chinese investments in Iran, it spoke of “deepening military cooperation” between China and Iran that would give China a foothold in this strategically important region; it noted that the agreement represented a “major blow to the Trump administration’s aggressive policy toward Iran”. The report said the agreement provided for 100 BRI-related projects, including airports, railways, free-trade zones, 5G telecom networks and the Chinese GPS system, Beidou. It also mentioned China enjoying port facilities at Jask island, located just outside the Hormuz.

Commentators quoted in the NYT report saw the agreement as not just bolstering bilateral ties but also “confronting the US”. It included a quote from the Iranian navy chief in the Chinese news agency, Xinhua, that “the era of American invasions in the region is over”. Later commentaries affirmed that the Sino-Iranian discussions on the agreement (at final stages, but not yet signed) had been accelerated by sustained hostility to both countries from the US administration.

Former US diplomat Philip H Gordon has written that even a partial implementation of the agreement “would signal a major escalation in the US strategic competition with China and blow a hole in the administration’s “maximum pressure” campaign against Iran at the same time”. Other commentators, Ross Harrison and Alex Vatanka, have noted that both Iran and China share the motivation “to push back against US efforts in the Middle East”, and that these two countries could be cooperating across the Eurasian landscape – from the Mediterranean to Syria to Central Asia, the Caspian and the Gulf.

However, the finalisation of the Sino-Iranian agreement has some way to go. The Iranian cabinet is said to have approved the agreement on 21 June. On 10 October, Zarif visited China, possibly to finalise the agreement and officially make its details public, but there are reports that China is still examining the pact. Here, China has the same constraint as Russia – the need to balance its ties between Iran and the Gulf Arab states. Observers have noted that, as Zarif landed in China, a senior Chinese official arrived Abu Dhabi to discuss fleshing out the comprehensive strategic partnership that China has with the UAE.

Post-election outlook

Trump has promised that he will have a deal with Iran in the first month of his second term. More realistically, a victorious Trump will retain his commitment to sanctions and regime-change. As Trump told Rush Limbaugh of Fox News on 9 October: “… if you [Iran] do something bad to us, we are going to do things that have never been done before.” But while the pain inflicted on the Iranian people will continue, there is no likelihood of a new US-sponsored regime emerging in Tehran.

The US’ visceral hostility to Iran has served little useful purpose – it has damaged US standing and credibility in West Asia and alienated it from its Western allies. The US’ rhetoric of threat of assault and annihilation, the overt encouragement to domestic dissent, the deliberate inflicting of pain of the Iranian people, and the calculated show of force in the targeted killing of General Qassem Soleimani – none of these has served US interests.

Instead, Iran has shown its own resilience in the face of these pressures – the tanker wars in Gulf waters; missile attacks on American targets in the Gulf and Iraq; the crippling of half of Saudi oil production for a few days last year; continued Iranian influence in Iraq, Syria, Lebanon and Yemen; its control over its powerful Shia militia across the region, and, above all, the reinstatement of its nuclear weapons programme that has shortened the “breakout” from a year to a few months – all of these affirm the futility of the confrontationist approach.

Biden has offered an alternative approach. He has affirmed he will take the US back to the JCPOA, subject to full Iranian compliance”, making this the “starting point” for further negotiations “to strengthen and further its provisions” – a reference to the other issues relating to regional security that are agitating the US and its allies in West Asia.

Whatever the electoral outcome, Iran will certainly command serious US attention after the elections. Jake Sullivan, former national security adviser to Biden when he was vice president, has said Biden’s approach would “leverage diplomacy, backed by pressure” to bring the Iranians to negotiations.

 Joe Biden has affirmed he will take the US back to the JCPOA. AP Photo

American interlocutors will find Iran a formidable negotiation partner. The harsh sanctions imposed on it over the last four years have imbued the nation with a sense of hard resolution about its interests and a deep distrust of the international order, given that the principal party to a solemn international agreement unilaterally reneged on it and, with impunity, went on to impose harsh punishment on Iran, though it was in full compliance with the agreement.

Mohammed Ayatollahi Tabaari, writing in Foreign Affairs, has also noted that there is now a unity of purpose and “coherence” in the Iranian foreign policy establishment that was not there earlier. Iran will thus face its discussion partners steeled by its successful endurance of the unfair sanctions and the conviction that the US – having failed miserably in the handling of the pandemic and its consistent failures to realise its agenda in West Asia – is much-diminished a player globally. Iran will drive a harder bargain than ever before, Tabaari tells us, prioritising easing of sanctions to obtain oil sales and the use of these resources to re-build its national economic, political and military capacities.

New world order?

Besides a changed Iran, the next US president will cope with larger global challenges, the most important of which will be close cooperation between Russia and China to confront the US-led world order, a confrontation in which they will have Iran as an enthusiastic partner.

There are several factors supporting this prognosis. One, China will remain a major challenge for the US: it will either seek its rightful place in the existing order, on par with the US, or, in face of US resistance, it will seek to overturn it. China has clearly moved beyond its economic agenda; it recognises that, in the words of distinguished West Asia commentator Ramzy Baroud, that “to sustain its economic growth unhindered, it has to develop the necessary tools to protect itself, its allies, and their combined interests”.

Two, it is unlikely that US-Russia ties will mend; suggestions in some American quarters that Russia could be detached from its China alliance, a reverse of what happened in the Cold War, do not have much resonance. Though Trump is supposed to have had a soft corner for Putin, his administration made no contribution to building ties with Russia. Russian commentator Andrey Kortunov points out that now, in terms of bilateral ties, “almost anything that could be broken is already broken … [and] there is little prospect of improvement”. Kirill Dmitriev affirms this view, saying: “We are at the lowest point ever in the history of US-Russia relations, so going even lower will be difficult.”

Three, Iran has opted to link its destiny with the East rather than the West, aligning with Russia and China for its security and economic interests. As Tabaari has noted, the shared animosity of the three countries for the US “has narrowed their previous divergence and created a coordinated front that Washington should not underestimate”.

In the post-pandemic world, a new regional and global order will emerge from this nascent alliance.

(The author, a former ambassador to Saudi Arabia, holds the Ram Sathe Chair for International Studies, Symbiosis International University, Pune.)