Iran Looks East

As implementation of the Joint Comprehensive Plan of Action (JCPOA) marks its second anniversary in a climate of uncertainty over continued US compliance, Iran has increasingly looked to Asia for trade and investment, while cementing a strategic partnership with Russia.

On Friday, January 19, the Atlantic Council’s Future of Iran Initiative, in partnership with The Iran Project, hosted a half-day conference in Washington on these evolving relationships between Iran, Russia, China, India, and Japan.

The Hon. Stuart Eizenstat, Chairman of the Advisory Board of the Future of Iran Initiative, William Luers, Director of The Iran Project, and Barbara Slavin, Director of the Future of Iran Initiative, welcomed participants and provided context for the discussion.

The participants in the first panel all expressed continued support for the JCPOA and concern that the Trump administration might not continue to waive US nuclear-related sanctions when the next deadline comes in May. Further, the panelists expounded upon the current and future landscape of engagement between Iran and India, China, and Japan, including cornerstone projects such as the Chabahar port on the Gulf of Oman and the Belt and Road Initiative.

China will maintain trade and investment ties with Iran no matter what Trump does, said Wu Bingbing, who directs the Institute of Arab-Islamic Culture at Beijing University. Wu added that Iran should “benefit from the JCPOA so it can strengthen the moderate forces inside Iran.” He said that China has a “no-enemy policy” in the Middle East and is not taking sides in the rivalry between Iran and Saudi Arabia, the United Arab Emirates and Israel. He said that the JCPOA is not only crucial for the Middle East, where its absence would lead to greater instability, but as an approach to negotiations in the future with North Korea.

Sumitha Narayanan Kutty, associate research fellow with the South Asia Program at the S. Rajaratnam School of International Studies at Nanyang Technological University, Singapore, explained that “the primary pillar that drives India’s relationship with Iran is connectivity.” She said that India’s commitment to develop the Chabahar port would continue no matter what Trump does, but acknowledged that a resumption of US sanctions could have a chilling effect on other cooperation. She noted that India has yet to identify an Indian company to operate Chabahar and is facing a March deadline to do so. Two European companies that were supposed to provide cranes for work at the port backed out due to fear of renewed US sanctions and a Chinese company took their place.

Sachi Sakanashi, acting director of the JIME Center at the Institute of Energy Economics, Japan, and a former Japanese diplomat in Tehran, acknowledged that US sanctions “have affected Japanese economic relations with Iran greatly” and that uncertainty over whether the US will stay in the JCPOA has stopped Japanese companies from making final investment decisions in Iran. Japan has resumed significant imports of oil from Iran, however, and US withdrawal from the JCPOA would “put Japan in a very difficult situation,” she said.

Moderator Bharath Gopalaswamy, the director of the South Asia Center at the Atlantic Council, noted how “very rare” it was for the views of India, China and Japan to align on such a major issue. He added that all three countries had managed to maintain good relations with Iran, Saudi Arabia, Israel and the United States.

The second panel dealt with Iran’s relations with Russia.

Theodore Karasik, senior advisor to Gulf State Analytics and an adjunct senior fellow at the Lexington Institute, said Russia had traditionally served as a “back door” to Iran for the Arab states across the Persian Gulf. He said the major Gulf states – Saudi Arabia and the United Arab Emirates –opposed the JCPOA because it did not diminish Iran’s regional footprint. Karasik also highlighted the importance of “sovereign wealth funds as a tool of foreign policy” for the Gulf states including in the future reconstruction of Syria.

Maxim Suchkov, editor of Al-Monitor’s Russia-Mideast coverage and a non-resident expert at the Russian International Affairs Council and at the Valdai International Discussion Club, downplayed the notion of a growing strategic relationship between Iran and Russia, saying that both countries regard themselves as “strategic singles in the international arena and regionally.” He added that “you cannot build a sustainable partnership” based merely on opposition to the United States.

Eugene Rumer, senior fellow and director of Carnegie’s Russia and Eurasia Program, said Russia’s foreign policy in the Middle East has been “unexpectedly agile, reasonably well resourced, very quick to seize opportunities that appear before it, but also careful not to overreach.” He said the US should seek diplomatic engagement with Russia, Iran, and Syria as opposed to an open-ended military presence in northern Syria.

Moderator Thomas Pickering, former Ambassador to Russia and former Undersecretary of State for Political Affairs, lamented that “the US is worse than absent” in the Middle East because of the unpredictability of Trump. He proposed that Congress amend the Iran Nuclear Review Act to base US compliance on a finding by the International Atomic Energy Agency and the US intelligence community that Iran is continuing to implement the JCPOA.