Iran nuclear deal: The good, bad and the ugly

M.K. Bhadrakumar July 21, 2016 9:42 AM (UTC+8)
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In a report on the implementation of a Security Council resolution backing a nuclear deal between Iran and world powers, UN Secretary-General Ban Ki-moon unwittingly made some indiscreet and irrelevant references which did its bit to undermine the deal, upset Tehran and drew criticism from Russia and the U.S. The ugly part is the crisis of confidence over the efficacy of the deal amid moves in the U.S. to kill it once a new president takes over. And the good part is that major powers believe the deal can survive and its implementation is on track.

The United Nations Secretary General Ban Ki-moon resorted to ‘damage control’ by issuing a statement on Tuesday lauding the Iran nuclear deal (Joint Comprehensive Plan of Action or the JCPOA) on its first anniversary. He has showered fulsome praise. Ban said,

-One year on, I remain certain that the JCPOA is the best way to ensure the exclusively peaceful nature of Iran’s nuclear program and to realize the great aspirations of the Iranian people.  I call for the JCPOA… to be implemented in a comprehensive manner, based on mutual respect and mutual benefit, and which would facilitate greater cooperation to achieve international peace and security.

But, regrettably, the damage has been done.

U.N. Secretary-General Ban Ki-moon attends a session of the St. Petersburg International Economic Forum 2016 (SPIEF 2016) in St. Petersburg, Russia, June 16, 2016. REUTERS/Sergei Karpukhin
U.N. Secretary-General Ban Ki-moon attends a session of the St. Petersburg International Economic Forum 2016 (SPIEF 2016) in St. Petersburg, Russia, June 16, 2016. REUTERS/Sergei Karpukhin

Ban’s earlier report of July 12 to the Security Council on the JCOPA stirred up controversy when it made references to issues that are way beyond the purview of the JCOPA, such as Iran’s missile program, its policies toward Yemen and its participation in a defense exhibition in Baghdad.

Why such an experienced diplomat made a gaffe at the fag-end of a terrific career remains a mystery. Can it be that Ban did not peruse the report that was drafted for him by aides who thought they were pleasing the crowd within the Washington Beltway?

But then, both US ambassador Samantha Power and Russian ambassador Vitaly Churkin joined hands to voice displeasure over the indiscreet, irrelevant contents of Ban’s report. Pure sloppiness?

At any rate, the bad part is that Ban unwittingly contributed his bit to undermining the JCOPA, giving boost to a vitriolic campaign that has been going on in the US media, think-tanks and the Congress against the Iran deal.

The campaign, having failed to stop the Iran nuclear deal, now aims to freeze the implementation of the JCOPA, with the hope that once President Barack Obama leaves the White House, the next president can be prevailed upon to reopen the deal.

The ugly part in all this is that a crisis of confidence may be developing at some point over the efficacy of the JCOPA itself. An early sign of this happening is available from the sharp warning by the speaker of Iran’s Majlis Ali Larijani in Tehran on Wednesday to the effect that the concerted “disruptive moves” afoot in the U.S. have reached a point that leaves Iran with no option but to take retaliatory action.

Larijani has directed the Atomic Energy Organization of Iran to keep the powder dry for a resumption of the suspended reprocessing activities, should a need arise. It may seem there is an ominous tone about it, although Larijani’s move can neither be underplayed nor overplayed. It is, essentially, an early warning that things are not going as well as they could have.

The Obama administration ought to take Larijani’s warning with utmost seriousness. Of course, Larijani’s standing needs no reiteration, not only by virtue of his closeness to the Supreme Leader – or his IRGC background and his present position – but also by the growing prospect that he is potentially a future president.

Of course, all this is playing into the factional struggle going on within Iran leading to next year’s presidential election.

But the good part is that there is still the conviction deep down on the part of the major powers that the JCOPA’s implementation is on track. A Russian Foreign Ministry statement on Thursday assessed with reference to the Joint Commission meeting to review the JCOPA work at Vienna:

-Representatives of the intermediary countries, Iran and the EU expressed satisfaction that implementation of the Joint Plan has reached a stable phase due to joint efforts during the preceding period.

Indeed, behind the posturing that is endemic to diplomacy, Tehran also has shown the patience to work diligently to overcome the apprehensions of the western banks regarding transacting business with Iran.

In a candid interview with Bloomberg, Iran’s Minister of Finance Ali Tayebnia gave the following assessment:

-The Iranian economy is already “seeing the positive effects” of sanctions removal;

-There are no more any “practical limits” to oil production and exports as such;

-Iran has fully implemented the JCOPA but “it seems the opposing sides to Iran are not fully loyal to their commitments or at least in practice…”

-“Mainly in the area of banking relations, especially big banks, we are still facing some problems and limitations, however some of these problems, gradually and over time, will be resolved. Some of this is maybe because of the failures of the counterpart…”

So, all is not lost. The rumours regarding the impending death of the JCOPA are exaggerated, after all. Looking ahead, on the other hand, the JCOPA has a fighting chance of survival.

Its detractors in the US could be placing hopes that with the departure of Obama from the White House, they would have a chance to kill the Iran deal. But these are hopes that are unrealistic and predicated on the false self-serving assumption that the US can impose its will on the world opinion and reimpose the UN sanctions against Iran. The fact of the matter is that the world – and the region surrounding Iran – has changed beyond recognition in the past year itself.

The world community will not want cascading tensions to reappear over Iran’s nuclear program. Nor does it want to isolate Iran or deny the mutual benefits of engaging Iran, which is the last frontier in a spluttering world economy starved of growth. The IMF has just forecast that Brexit alone may drag down the world growth rate to 3.1% this year.

The bottom line is, if not JCOPA, what else? A military attack on Iran by the US?

Make no mistake, whoever is the next US president, a mandate from the UN Security Council is not going to be forthcoming for reimposing the Iran sanctions, leave alone taking military action against that country. On top of the current turmoil in Turkey, whose final outcome is far from certain, who wants a war with Iran?

It is highly unlikely that Iran suo moto will jettison the JCOPA unless it is pushed to the wall. The gains of the JCOPA are already notable.

Iran has reversed its negative economic growth and expects to reach 5% growth this year as compared with minus 6.8% in 2013. The target set for next year is 8%. Inflation has been brought down to around 10% (June-July) from abnormal levels above 40% in the recent years.

But the real issue here is something else. The US lawmakers who block the Boeing’s proposed $25 billion business deal to sell aircraft to Iran do not get the point that they are only hurting self-interests. As Tayebnia put it,

-There are other companies in the world that can provide for our needs (of aircraft) and also we have more important needs with a higher priority… The American side (Boeing) has more of a need to close this deal with Iran.

Simply put, with or without the participation of the US business and industry, Iran is going to use its financial resources in the global economy. Funds are not the issue here, since financing is being offered to Iran at very low rates in the market. The real issue is about exploiting the profitable business opportunities in Iran.

 Ambassador MK Bhadrakumar served as a career diplomat in the Indian Foreign Service for over 29 years, with postings including India’s ambassador to Uzbekistan (1995-1998) and to Turkey (1998-2001). He writes the “Indian Punchline” blog and has written regularly for Asia Times since 2001.

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M.K. Bhadrakumar
MK Bhadrakumar served as a career diplomat in the Indian Foreign Service for over 29 years, with postings including India’s ambassador to Uzbekistan (1995-1998) and to Turkey (1998-2001). He writes the “Indian Punchline” blog and has written regularly for the Asia Times since 2001.
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