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Russia-Iran ties on the upswing

Consolidation of strategic ties between Russia and Iran was one of the most significant events in 2007. A breakthrough came when Vadimir Putin visited Tehran in October to become the first Russian leader since Joseph Stalin to set foot on Iranian soil. Mr. Putin is reported to have told Iranian Supreme leader Ayatollah Khamenei that Russia was ready to “expand ties without limitations” with Iran. This offer closely resonated with a proposal to form a strategi c alliance against common enemies that the Ayatollah made to the then Russian Security Council Secretary, Igor Ivanov, when he visited Tehran in February 2007.

It took Moscow eight months to respond because it insisted on synchronising the all-round expansion and deepening of Russian-Iranian ties with Iran’s steps to answer the outstanding questions on its nuclear programme. Mr. Putin did not avail himself of a long-standing invitation to visit Tehran till after Iran and the International Atomic Energy Agency (IAEA) agreed in August on a “work plan” to clarify Tehran’s past centrifuge development work.

A few weeks after Mr. Putin’s historic visit, Iran handed over to the IAEA details on its P-2 centrifuge work, prompting IAEA Director Mohamed El Baradei to say Iran was making “good progress” towards resolving the outstanding questions. On December 3, the U.S. released a National Intelligence Estimate (NIE) report that cleared Iran of the charge of pursuing a nuclear weapons programme. Significantly, the report which signalled Washington’s retreat from the military option, had been kept under wraps for over a year.

On the same day, President Mahmoud Ahmadinejad became the first Iranian leader to attend the Gulf Cooperation Council summit in Doha. The next day, Secretary of Iran’s Supreme National Security Council Saeed Jalili was in Moscow to meet Mr. Putin. Mr. Jalili told the Russian President that the Iranian leadership was committed to building “long-term, strategic and future-oriented” relations with Russia. Russian Foreign Minister Sergei Lavrov said after the meeting that the Iranian envoy had pledged to answer all outstanding questions of the IAEA “in the nearest time possible.”

On December 13, Russia and Iran reached an agreement on a timetable for the completion of the Bushehr nuclear plant, which had been dogged by repeated delays and a row over payment. On December 16, Russia shipped the first consignment of uranium fuel to Bushehr. On December 17, the Al Qaeda leader — number two — Ayman Al Zawahiri denounced Iran in a video for backing off from its support to Iraqi Shia attacks on U.S. troops. In the last days of 2007, a second batch of fuel rods was delivered to the Iranian plant. By the end of February, the reactor will be fully stocked with fuel needed to start it up. Russian officials said this could happen before the end of 2008.

The sequence of events shows that Mr. Putin seized the opportunity offered by the changing landscape around Iran and worked towards consolidating the changes. Russia moved to upgrade bilateral relations with Iran across the board.

Iranian reports said the two countries were discussing 130 economic projects worth over $100 billion and aimed at boosting bilateral trade from the current $2 billion to $200 billion in the next 10 years. Energy will account for much of the planned growth in ties. Russia and Iran hold between them about 20 per cent of the global oil reserves and 42 per cent of natural gas. Russian oil and gas companies are already involved in Iranian hydrocarbon projects, and the Russian-Iranian trade commission at its meeting in Moscow on December 13 discussed plans to set up a joint gas venture to explore deposits in the Persian Gulf and Central Asia. The JV could undertake, according to Russian energy officials, the construction of the Iran-Pakistan-India pipeline.

An energy axis between Russia and Iran could eventually lead to the establishment of a gas OPEC lobbied by Tehran and favourably viewed by Moscow. This will have a profound impact on strategic equations in the region. Russia is keen on directing Iran’s gas exports to Asia and keeping the European market for itself. Energy underpins an emerging strategic triangle comprising Russia, Iran and China. The latter has signed multibillion-dollar energy deals to buy Iranian oil and liquefied natural gas and may also be at the receiving end of proposed gas pipelines from Iran. If the IPI project comes through, it can be extended to China; otherwise a Turkmenistan-China gas pipeline scheduled to be built before the end of 2008 can be connected to Iran (this will merely require reversing current gas flows from Turkmenistan to Iran via an existing pipeline between the two countries).

Russia has agreed to strengthen Iran’s military muscle. Following his talks in Tehran last month, head of the Russian Federal Service for Military and Technical Cooperation (FSMTC) Mikhail Dmitriyev said defence ties between the two countries “reinforce stability in the region.”

Russia has also encouraged Iran’s deeper involvement in multilateral arrangements in the region. Moscow and Tehran see eye to eye on many regional issues. Both are opposed to U.S. plans to build oil and gas pipelines on the Caspian Sea bed bypassing Russia and Iran, and both want the sustainable energy security in Central Asia and the Caspian to be the prerogative of the region’s nations. The Caspian Summit in Tehran on October 15-16, which provided a convenient pretext for Mr. Putin’s visit to Iran, supported Iran’s initiative to set up an economic cooperation organisation of the Caspian nations. The new body will hold its first meeting in the Russian city of Astrakhan on the Caspian Sea later this year. In a major boost for Tehran, the Caspian states ruled out the use of their territories for attack against Iran.

Russia has strongly supported Iran’s membership in the Shanghai Cooperation Organisation. Addressing a New Year press conference in Moscow, Russia’s Deputy Foreign Minister Alexander Losyukov revealed that the SCO will “soon” end its moratorium on expansion and consider admission of new members. He made it clear that Iran, which has an observer status in the SCO, would be a prime candidate for full membership. He said Iran’s involvement in the SCO was essential for “effective solution of problems.”

Mr. Putin’s offer of strategic partnership with Iran has a rider: it must renounce the nuclear weapons option. Following a new round of infighting in the Iranian leadership, Iran’s chief nuclear negotiator Ali Larijani, a moderate close to Ayatollah Khamenei, was replaced by a former member of the Islamic Revolutionary Guards Corps (IRGC) Saeed Jalili, a hard-line ally of President Ahmadinejad. However, Tehran’s continued cooperation with IAEA indicated that moderates have gained the upper hand, at least for now.

Strategic tie-up with Russia is too tempting an option for Iran to turn down. With Russia’s help, it can advance its cherished goal of achieving regional supremacy and extending its strategic reach to Central Asia and beyond. At the same time, Iran wants to keep the nuclear option open. Moscow has firmly linked further defence and nuclear energy cooperation with Iran to progress in its interaction with IAEA.

On December 23, Iranian Defence Minister Mostafa Mohammad Najjar announced that Russia would supply Iran deadly S-300 anti-missile systems, which will dramatically increase its ability to repulse air or missile attacks by the U.S. or Israel. Russian defence sources confirmed the report but the country’s top weapons export authority, FSMTC, issued a denial. However, it did not deny the deal as such but said: “The delivery of S-300 air defence missiles … is not on the agenda and is not being discussed with the Iranian side at this moment.” Once again, Moscow is dangling the carrot. It remains to be seen if Mr. Putin’s preferred successor, Dmitry Medvedev, will display the same diplomatic skills as Mr. Putin has done in dealing with Iran.

Russia’s strategic rapprochement with Iran stands out in stark contrast with New Delhi’s stagnant relations with Tehran. This may be a further indication that New Delhi is drifting away from Moscow. India has developed cold feet on the IPI project and the State Bank of India has banned letters of credit for Iranian firms in support of U.S.’ unilateral sanctions on Iran. Iran figured prominently in Prime Minister Manmohan Singh’s discussions with Mr. Putin during their summit in Moscow last November, according to Indian officials.

Considering the fact that Russia has a vital stake in getting India on board on Iran, Mr. Putin must have offered Dr. Singh his frank reading of the situation: the U.S. overreach in Iraq offers a unique chance for making strategic gains in the region by forging closer ties with Iran. Has India chosen to play up to the U.S. and miss the chance?

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