Understanding the US pull out from the Iran Nuclear Deal

Issues Details: 
Vol 12 Issue 2, May - Jun 2018
Page No.: 
Sub Title: 
Causative factors underlying the decision to cancel the deal and implications there of
Lt Gen Syed Ata Hasnain, PVSM, UYSM, AVSM, SM, VSM** (Retd)
Friday, May 25, 2018


Almost all geopolitical issues connected to Iran today have a history which primarily goes back to 1979-80, the years which many analysts classify as the most significant period of the second half of the 20th Century in regard to that nation. The Iranian Revolution of 1979 displaced Shah Reza Pahlavi under whom Iran had remained a strong US ally. It was oil which lay behind this relationship. In 1953 the US had engineered a plot to rid Iran off Muhammad Mossadegh, the then Iranian Prime Minister who had nationalized Iran’s oil industry against US/UK interests. The successful plot enhanced the powers of Reza Shah Pahlavi the monarch who had ascended the throne in 1941. Under him 80 percent of Iran’s oil reserves were returned to the US and UK firms. Since he was anti-communist, secular and pro West the arrangement suited the US. What was not catered for was the degree of resentment built up by the Shah’s brutal and dictatorial governance with the famous Savak (secret police) wreaking hell on the lives of the Iranian people. The resentment finally came to a head in Jul 1979 when the Iranian people turned to Ayatollah Khomeini, a radical Shia cleric, who had been forced into exile from Iran in November 1964. His return to Iran on 01 Feb 1979 after the Shah had fled to Cairo on 16 Jan 1979, led to the eventual creation of the Islamic Republic of Iran.

The United States, fearful of creating turbulence in the Middle East, did not come to the defense of the Shah. However, in Oct 1979 President Carter allowed the exiled Shah to enter the US for medical treatment of cancer. His decision was humanitarian and not political. With news of this, anti-American sentiment in Iran exploded leading to the seizure of the US embassy in Tehran by Iranian student supporters of the Ayatollah and 66 members of the embassy staff being taken hostage. Of these, 14 were released later but the other 52 remained hostages for 444 tense days through 1980 until they were released on 22 Jan 1981, a day after the inauguration of President Ronald Reagan.

The background is necessary to understand events almost 40 years later. “It’s a bad divorce, like The War of the Roses,” said Vali Nasr, the Iranian-born Dean of Johns Hopkins University’s School of Advanced International Studies, “Neither side has ever gotten over it.” In fact, so deep did it hit the US psyche and possibly its image that it continues to nurse a grudge which it cannot easily overcome. The US froze US $ 8 Billion of Iranian assets in US banks and imposed sanctions on Iran. Subsequently the US assisted Saddam Hussain the Iraqi leader, into the Iran-Iraq war which lasted almost eight years. Many of its actions against Iran are purported to be connected to the intense humiliation that it perceived as a super power at the hands of a lowly state under a clergy.  Enmity between Iran and the US has been intense and only mirrored as much by Iranian hostility towards Israel who it considers a US lackey.

The Nuclear Program and Spin Offs

Surprisingly, little is written about the fact that Iran already had a peaceful nuclear program in place even before the Iranian Revolution. The IAEA even continued its inspections of the program to assist it but in 1983 it was stopped under US pressure. In 1990 Iran renegotiated with Russia for the reconstruction of an earlier shelved project and thus recommenced its nuclear program. It was only in 2002 that there was discovery of the possibility of a clandestine Iranian nuclear weapon program which was in the offing. Iran is a non-nuclear state signatory to the Non-Proliferation Treaty (NPT). Although the IAEA undertook inspections and cast doubts on the peaceful nature of development of Iran’s nuclear technology it did not find anything substantial to prove that the program was anything other than peaceful. In nuclear parlance once doubts of this nature are established the credibility of ‘peaceful’ always remains an issue. And so, it was, with the US refusing to believe the IAEA’s findings.

The period 2005 to 2015 was one of intense negotiation, denial, subterfuge, threats and coercion. Not the least, it was the aggressive posturing of Iran’s President Mahmud Ahmadinejad (who came to power in 2005) which continued to give perception that Iran was undertaking enrichment for a nuclear weapon program. This was despite the Iranian Head of State, Ayatollah Ali Khamenei, issuing a fatwa forbidding the production, stockpiling and use of nuclear weapons. The full text of the fatwa was released in an official statement at the meeting of the IAEA in Vienna. The fact that Iran also possessed a deadly stock of guided missiles in its military arsenal only contributed to the apprehension of its intention.

Geopolitics of Nuclearization

The geopolitics of nuclearization is well known as is the fact that nations adopting such programs ensure these remain clandestine and deniable. Inevitably it is geopolitics, geo-strategic equations, balance of power, deterrence and countervailing strategies which contribute to the tensions relating to the acquisition of nuclear weapon technology. In the case of Iran, US apprehension could be identified with a couple of issues.

• The history of US-Iran enmity since 1979 and the inability to move towards any form of rapprochement.

• The fact that Iran had been classified as a rogue state which was perceived to be supporting trans-national terror. The potential of a terrorist organization ultimately laying its hands on a small nuclear device through an irresponsible control system has been the prime US apprehension.

• Iran’s stated enmity with Israel, made even more strident with the coming of Ahmadinejad.

• The feasibility that Iran going nuclear would commence a spiral of other smaller states following the same in the Middle East; in particular Saudi Arabia, thus commencing an unstoppable nuclear race to the detriment of international security.

• The feasibility of the balance of power in the Middle East getting completely skewed.

To add to all these, the 2006 Israel Hezbollah War did not go too positively for Israel. Till then the proverbial Shia Crescent, ascribed to Iranian ambition, had remained only a threat in being. The Hezbollah-Iran connection gave Iran a direct leverage to Israel’s immediate neighborhood and the first real strategic gains for it to extend its reach. In these events lies the build-up to the situation which erupted in Syria in 2011. Without doubt it was the influence of the failed Arab Spring which instigated the Syrian Civil War with efforts at regime change by multiple extraneous agencies. Iran solidly backed the Allawite set up under Bashir Assad (the Allawites are a close resemblance to Shiaites although not exactly).

Even as the Middle East erupted into greater instability with the advent of the ISIS (Daesh) in 2014 Iran was already reeling under economic sanctions.  And it was in long standing negotiations with the P5+1 (referring to the five permanent members of the UN Security Council and Germany) who had in 2006 proposed a framework agreement to Iran offering incentives to halt its enrichment program for an indefinite period of time. In the interim the US National Intelligence Estimate (NIE) had concluded and advised that Iran’s nuclear weapons program (design and weaponization work) as well as clandestine uranium conversion and enrichment was believed to be technically capable of producing enough highly enriched uranium for a nuclear weapon between 2010 and 2015. The period 2006-2015 witnessed a game involving ratcheting sanctions under UN flag and spiraling Iranian nuclear capability but unproven whether the same was for a weapon program or peaceful purposes. The trade sanctions created a recession in Iran.

The Joint Comprehensive Plan of Action (JCPA)

On 14 Jul 2015, even as Iran’s stock rose as one of the main opposition to Daesh, a Joint Comprehensive Plan of Action, also known as the Iran Nuclear Deal was signed by the P5+1. Iran agreed to limit its nuclear development program in return for the end of economic sanctions. The arms embargo would remain in place until 2020. Specifically, Iran agreed to reduce its 12000 kg stockpile of enriched uranium to just 300 kg. It agreed to remove about two-thirds of its centrifuges that produced uranium. It would eliminate the core of the Arak plutonium reactor.  Iran agreed to neither produce nor acquire highly enriched uranium or weapons-grade plutonium.  The UN’s IAEA inspectors would have daily access to Iran’s entire nuclear production supply chain. The agreement guaranteed that, for 10 years, Iran would be at least a year away from producing a nuclear weapon. That is much longer than its “breakout time” of two to three months before the agreement. According to the New York Times, the deal succeeded in getting 97 percent of Iran’s nuclear material out of the country.

The agreement may have reduced Iran’s ability to create a nuclear bomb but in no other way impinged on the allegations which the western led international community appeared to have against it; human rights, support for transnational terror and its arsenal of guided missiles; add its anti-Israel stance to this. The deal was opposed by Saudi Arabia and Israel on grounds that the agreement allowed Iran to build nuclear weapons after the 10-year moratorium. They also alleged that removing sanctions gave Iran more economic power to fund terrorist organizations in Syria, Lebanon, and Yemen.

While the Iran Nuclear Deal met the approval of the UN which undertook the process to progressively remove the sanctions, even the elaborate US legislative system gave approval to it. It was definitely not a perfect deal but then, the P5+1 had within its ranks two supporters of Iran in Russia and China. The latter is hugely dependent on Iranian oil and the former on Iranian strategic support in the Middle East and more specifically in the Levant.

Even before UN and EU sanctions could be officially lifted foreign companies began flocking to Iran. Some went even before the deal was signed. In 2015, Tehran hosted a flurry of trade delegations and signed new contracts to boost cooperation in energy, transportation, and other sectors. Obviously, a nation of 83 million people under intense economic sanctions and extremely low on development with potential for creating capital through energy sales awaited foreign investment opportunities. These would be beneficial for the EU and others. For India, a grand opportunity arose through the potential of development of the Chahbahar port with the strategic advantage of reaching out to Afghanistan and the Central Asian Republics besides effectively joining the extremely strategic North South Corridor to Russia. It was only the US whose attitude remained reticent and transactional, possibly due to inability to set aside the psychological effect of the 1979-80 hostage crisis.

Trump and the Iranian Nuclear Deal

While President Trump in the run up to his presidency promised US withdrawal from the Deal and reinforced that with much rhetoric he did not rush his decision. As a candidate, Trump had described the agreement as “catastrophic” and “the worst deal ever.” The apparent initial hesitation gave rise to speculation that he had diluted his stance towards the Deal. It was the fast-changing geopolitical situation in the Middle East which then contributed towards his final decision to pull the US out from it. In addition, the tempering presence of his initial security advisers perhaps held him back. The induction of John Bolton as National Security Adviser and Mike Pompeo as Secretary of State probably spurred the final decision.

The Trump opposition to the Deal is based upon the following issues: -

•   Demand for more diligent inspections. The apparent allegation being that Iran was effectively hoodwinking the inspections.

•  Make sunset clauses permanent. The deal allowed Iran to produce nuclear fuel after 2030. The implied 10 year moratorium of Iran being a year away from producing a nuclear weapon is not acceptable.

•  Include Iran’s ballistic missile program. The Israeli information that a large number of guided missiles have been placed in Lebanon to target Israeli territory and assets has obviously been a major input. If this input is true Iran would not need a nuclear weapon to annihilate Israel.

•  Remove any presence or influence in Lebanon. Over the last 15 years Iran’s support to Hezbollah has been responsible for the influence that the group wields in Lebanon.

•  Get Iran to stop funding the Iranian Revolutionary Guard Corps, Hezbollah, and other terrorist groups. In 2016, Iran expanded its influence in Iraq and Syria. It increased cyber-attacks in the West and Saudi Arabia, according to the New York Times.

The demands reflect US concerns about the balance of power in the Middle East. Towards the later part of the Obama presidency an impression had been created that the US was reluctant to pursue an active Middle East policy any more, especially after the dilution of dependence on Middle Eastern oil post the shale gas boom in the US. The entry of Russia militarily into the Syrian conflict, the certainty that regime change in Syria was no longer possible and the defeat and eviction of Daesh from north Iraq and Syria, has opened an opportunity for Iran to extend its influence from west Iran right through the Levant to Lebanon and thus the shores of the Mediterranean. Iran-Russia-Syria in the Levant spells the control of the link territory from Europe to the Middle East and effectively counters the US-Israel-Saudi influence.

Most Western analysts conclude that Trump’s strategy focuses essentially on regime change in Iran through sanctions and instigation of internal turbulence. Efforts towards this in the past have not succeeded and in the future will depend entirely how long the Deal can survive without the US in tow. Clearly Europe is not in favour of any reneging on the Deal because on almost all counts, the monitoring of the Deal has revealed almost implicit follow up by Iran. It’s a question of how long the P5+1 can hold the Deal together without the US. The US will no doubt bring linked sanctions to break the unity. Foreign companies and oil buyers dealing with Iran will also come under sanctions. Will European companies last the coercive practices of the US is a moot point and will be one of the major considerations in the ability of the European countries to continue the Deal in conjunction with Russia and China.

President Trump’s final decision to pull out from the Deal appears to have been made on the basis of his assumed success in getting the North Korean leader Kim Jong Un to finally come to the negotiating table. One basic difference exists there; North Korea is already a nuclear power. So, for Kim Jong Un it is no great deal to make a few concessions. Besides he is supported by China with whom the US has a deeply linked set of economic interests. Iran on the other hand is not a nuclear weapon power yet and its supporter Russia is a competing strategic power in the Middle East. The circumstances being completely different may not merit a comparison of the two situations involving the erring so called ‘rogue states’ (as per US). However, Trump’s posturing on Iran could be intended to send home a message to Kim Jong Un that complete disarmament is the only thing he will stand for. The chances of Kim Jong Un agreeing to any such proposal appear remote.

The one thing Trump has amply demonstrated by his action on Iran is his willingness to go alone and take decisions he considers favour US strategic interests. Whether the decision of President Trump goes beyond the broad understanding of objections which have been outlined is unclear. For example, it is learnt that the Friendship gas pipeline from Iran through Iraq, Syria, Lebanon to Europe, earlier shelved could be under reconsideration. It will mean a moral victory for Iran in the renewal of its energy relationships and infrastructure and thereby contribute to its economy. Trump, Israel and Saudi Arabia do not wish to see Iran enriched in any way as they perceive that this will help it fight the wars in Syria and Yemen and also strengthen its relationship with Hezbollah. Sanctions would mean Iran would be in the dog house again with lesser capacity to conduct such proxy operations.

Whether Trump has any plans to destabilize Iran through engineering internal turmoil is also unclear. If he does, the one nation which could be sucked into the plan would be Pakistan which has a long border with Iran in its restive Baluchistan province. That will provide Pakistan the nth chance to emerge as a frontline state for the US and Saudi combine with grave implications for India. Unlikely that Turkey will cooperate with the US on any such mission.

It may also be recalled that the world got quite used to a sanctioned ‘Iran’ while the sanctions were in place. There is no guarantee that it won’t happen again. Not every foreign company, bank, or oil trader will be inclined to comply with US sanctions, particularly if their own governments are frustrated with the US re-imposition of sanctions. There is no multilateral interest now in targeting Iran with financial pressure and diplomatic isolation, unlike during the 2012 to 2015 period of most intensive global sanctions on Iran. The moral part of it all is that almost all governments are fully convinced that Iran had complied with 95 percent of the requirements of the deal.

What if Iran resumes its nuclear program as a result of the breakdown of the Deal; that is if even the Europeans, Russians and Chinese cannot retain it. Will the US-Israel-Saudi combine opt for war? That possibility remains remote because if anything ‘winnability’ and regime change remain doubtful. Where Trump’s concerns do surely gel is the huge imbalance that Iranian influence is going to cause once the Levant is firmly in its hold. Israel will feel threatened more than ever before and will therefore look at ways of securing itself. The last resort will be a disastrous war which will destabilize the entire Middle East with resultant effects on the world economy. Could not Trump’s diplomacy have involved re-engagement with Iran to reduce its tension with Israel. That is where the psychological ego effect of 1979-80 comes in and overcoming that will always remain a challenge for the US.

As a summation of the decision one could not find a better one than this. James Dobbins, a former U.S. Ambassador to the E.U., who negotiated with Iran after the U.S. invasion of Afghanistan and now works at the Rand Corporation, said that the decision “isolates the United States, frees Iran, reneges on an American commitment, adds to the risk of a trade war with America’s allies and to a hot war with Iran and diminishes the prospects of a durable and truly verifiable agreement to eliminate the North Korean nuclear and missile threat”.

Effects on India

As one of Iran’s biggest oil purchasers and in constant engagement with it over the Chahbahar port India will be deeply affected by sanctions. Through the first quarter of 2018 India had the unique honor of hosting both the Israeli Prime Minister and the Iranian President besides a visit by Prime Minister Modi to Palestine.  But the dilemma brought up by the US decision could be found reverberating in the first statement from India which read – “All parties should engage constructively to address and resolve issues that have arisen with respect to the JCPOA.”

Tentatively in the US camp as a strategic partner India has tremendous advantages from that and the relationship with Israel. It straddled the Middle Eastern strategic divide effectively through a transactional relationship with Iran on which it is dependent for its energy security and strategic connectivity. Tension in the Middle East and any portents of war will hit India very hard; first due to the definite rise in energy prices and second because of the likely displacement of the huge Indian diaspora. Can India make a special case for itself admitting that it needs the US more than it needs Iran and that engagement with Iran would actually keep open lines of communication to a pragmatic and willing future leadership which may be able view Iran’s relations with the world through a different prism.