Introduction

Ever since taking over as President, Donald Trump’s approach towards Iran has been excessively rash and lacking in nuance. The US withdrawal from JCPOA (Joint Comprehension for Plan of Action), the imposition of sanctions, and brash statements by Trump have heightened tensions between both countries. Allies of the US, including EU member states (especially Germany and France), have expressed their disapproval of Trump’s Iran policy on numerous occasions.

In August 2019, during the G7 Summit at Biarritz (France), it seemed that Trump might have changed his approach towards Iran. The US President expressed his openness to engaging with Iran and dubbed it as a country of immense potential. After the attack on Saudi Oil facilities, there has been a visible shift in the approach of Germany, France, and the UK towards Iran. All three countries blamed Iran for the attacks. In a meeting on the sidelines of the United Nations General Assembly (UNGA) these three countries issued a statement condemning the attack. They also held Iran squarely responsible for the attack. Said the joint statement:

It is clear to us that Iran bears responsibility for this attack

Why China is giving importance to Iran

The fact is that Tehran is rich in natural resources, and its geographical location makes it important in the context of connectivity in South Asia and Central Asia (especially in the context of the China Pakistan Economic Corridor – CPEC).

This is one of the main reasons for Beijing seeking to strengthen ties in spite of US withdrawal from JCPOA and imposition of sanctions by the Trump administration. The importance of Iran in China’s strategic goals is reiterated from the fact, that it is part of the ‘home affairs region.’

China-Iran ties

In January 2016 (months after the JCPOA was signed), Chinese President Xi Jinping visited Iran. During his visit, it was decided that China and Iran would expand their bilateral trade to $600 billion over a period of 10 years. Iran also welcomed the Belt and Road Initiative (BRI).

According to the joint statement, “The Iranian side welcomes ‘the Silk Road Economic Belt and the 21st Century Maritime Silk Road’ initiative introduced by China.” As Iran-US ties have gone downhill under Donald Trump, Beijing has continued to strengthen ties with Tehran.

Both sides also signed a document which outlined the  strategic vision for a period of 25 years.

In September 2019, China made a commitment of $400 billion during Iranian Foreign Minister Javad Zarif’s visit to China. While China will invest $280 billion in Iran’s oil, gas, and petrochemicals sectors, $120 billion will be invested in Iran’s infrastructure.

In the energy sector, key projects that China is so far involved in are Phase 11 of the supergiant South Pars natural gas project and West Karoun.

China’s State-owned China National Petroleum Corporation (CNPC), one of the country’s “big three” producers, holds an 80% stake in Phase 11 of the supergiant South Pars gas field (CNPC stepped in after France’s Total withdrew in 2018 due the imposition of sanctions by the US). So far China has been slow in the development of Phase 11, but it is likely to accelerate the pace of the project. Similarly, Beijing has assured Iran that it will increase production from the West Karoun oil fields (from 5% to 25% by 2021).

China is financing some important infrastructural projects in Iran, too. This includes the electrification of the Tehran-Masshad railway line (a contract between both countries was signed in 2017, and the cost of this project is estimated at $1.5 billion). The other key project where China will be involved is the Qom-Isfahan high-speed train line, and to extend this upgraded network up to the north-west through Tabriz (which is the starting point of the Tabriz-Ankara gas pipeline). Tabriz is also home to a number of energy projects. This project is especially important in the context of China’s connectivity goals, as it will connect Urumqi (Xinjiang) to Tehran, Central Asia, and Europe.

At a recent meeting of the Economic Cooperation Organization (ECO), which has 10 member states (Afghanistan, Azerbaijan, Iran, Kazakhstan, Pakistan, Tajikistan, Turkey, Turkmenistan, Uzbekistan and Kyrgyz Republic), several studies pertaining to a number of important projects involving to Iran were reviewed, including the Iran-Turkey-Pakistan economic corridor (such a corridor will help in facilitation of hard and soft infrastructure).

Iran-Pakistan relations

Islamabad, which has had an unpredictable relationship with Tehran, has also begun to warm up. In February 2019, after the killing of 27 revolutionary guards, Chief of Revolutionary Guards Major General Mohammad Ali Jafar issued a stern warning to Pakistan:

Why do Pakistan‘s army and security body … give refuge to these anti-revolutionary groups? Pakistan will no doubt pay a high price.

In 2017, after the killing of 10 border guards, the head of the Iranian armed forces, Major-General Mohammad Baqeri, had warned Pakistan that it should take action against the Jaish al Adl group lest it will be forced to strike the terror camps in Pakistan.

A visit to Iran by Pakistan Army Chief Qamar Javed Bajwa in November 2017 was the first such visit in two decades. During his visit, Bajwa met with Iranian Supreme Leader Ayatollah Ali Khamenei, President Hassan Rouhani, Defense Minister Amir Hatami, and several other senior military officials.

Some high level exchanges in 2018 also sought to mend ties and address misgivings between both countries.

Iran-Pakistan connectivity

In spite of bilateral tensions, Iranian Foreign Minister Zarif, while speaking at a prominent Islamabad based think tank (Institute of Strategic Studies Islamabad), invited Pakistan to join the Chabahar Project. The Iranian Foreign Minister also announced that Tehran was exploring participation in the China Pakistan Economic Corridor (CPEC). In May 2019, Iran had mooted the idea of connecting Chabahar Port with Gwadar.

Interestingly, India has taken over operations of part of the 1^st phase of Chabahar in 2018. A statement, issued by the Ministry of Shipping, stated:

The Government of India took over the operations of a part of Shahid Beheshti Port, Chabahar, in Iran during the Chabahar Trilateral Agreement meeting held there on December 24, 2018

Initially Chabahar was perceived as a counter to Gwadar Port (Baluchistan). Both ports are 70 kilometres apart. New Delhi had invested in Chabahar with a view to get access to Afghanistan and Central Asia (Pakistan has long refused to grant India transit rights to Afghanistan).

India-Iran relations

Ever since the removal of exemptions from the US, Tehran & New Delhi ties have been witness to some differences. Iran has complained of New Delhi toeing the American line, and failing to stand up to Washington, unlike Beijing. Senior Iranian diplomats have complained on numerous occasions about the slow progress on Chabahar Port and the trilateral connectivity. The Iranian Foreign Minister’s proposal to connect Chabahar with Gwadar thus needs to be viewed in this context.

More recently, Iranian Foreign Minister made a similar point echoing these views. He also said that Tehran would have expected India to be more ‘resilient.’

Indian PM Modi did, however, meet the Iranian President on the sidelines of the UN General Assembly in September 2019.

While New Delhi-Iran ties have witnessed a slight deterioration, Iran-Pakistan ties have witnessed an upswing. In his first speech after his party’s triumph, Imran Khan had said that he would seek to improve ties with both Iran and Saudi Arabia. In his first telephonic conversation with Rouhani, Khan stated that he wanted to build special trade relations with Iran.

In his first few months after taking over, Khan, due to economic constraints, focused more on Saudi Arabia (Riyadh promised $6 billion in assistance).

Pakistan-Iran ties

In recent months, Khan has sought to play peacemaker between Iran and Saudi Arabia after the attack on a Saudi Oil facility. Khan visited both Riyadh and Tehran in October 2019. Khan also stated that he was entrusted with this responsibility by Donald Trump himself.

Significantly, Iran praised Imran Khan for his efforts in trying to bring about peace in the Middle East. At a joint press conference, the Iranian President said:

I told Prime Minster Imran [Khan] we welcome any gesture by Pakistan for peace in the region and appreciate his visit to our country

Pakistan Army Chief Bajwa also visited Tehran in November 2019,  and sought to strengthen defence ties between both countries. Apart from meeting with the Chief of Staff of the Iranian Armed Forces (Major General Mohammad Hossein Baqeri) and Army Commander Major General Abdolrahim Mousavi, the Pakistan Army Chief also met with Iranian President Hassan Rouhani and Foreign Minister Mohammad Javad Zarif.

Iran-Pakistan connectivity

There have also been some interesting developments between Iran and Pakistan in the context of connectivity and economic relations. Another interesting development is Pakistan’s recent idea of getting Iran on board the CPEC project.

Abdul Hafeez Shaikh, the Prime Minister’s adviser on finance, in an interaction with media, stated that Pakistan was looking at a CPEC+ arrangement where other countries could get on board.

He also stated that CPEC needed to be projected as a potential connector between China, Iran, and Saudi Arabia.

Islamabad’s decision to invite Iran to join CPEC clearly reiterates Iran’s crucial location. It remains to be seen how the Tehran-Islamabad-New Delhi trilateral will work out in the near future.

Need to look beyond a zero-sum approach

While it is easy to look at connectivity from a zero-sum perspective, a change in Pakistan’s approach and statesmanship from the Indian side could pave the way for a fresh approach towards connectivity. India, Pakistan, Afghanistan, and Iran can join hands. Such connectivity need not be under the rubric of CPEC, but could be driven by Pakistan providing land access for India into Afghanistan and Central Asia. At the inaugural function of the Kartarpur Religious Corridor, the need for re-examining bilateral ties, as well as regional connectivity was alluded to. Former Prime Minister Dr Manmohan Singh had also spoken of trilateral cooperation between India, Pakistan, and Afghanistan. Said Manmohan Singh:

I dream of a day, while retaining our respective national identities, one can have breakfast in Amritsar, lunch in Lahore and dinner in Kabul. That is how my forefathers lived. That is how I want our grandchildren to live.

Conclusion

Tehran may be facing domestic challenges, but it is crucial not just in the strategic context but also for economic and cultural connectivity in South Asia. It remains to be seen whether all stakeholders – India, Pakistan, Iran, and Afghanistan – can move beyond a myopic vision and can develop a long term vision for connectivity. In the short run, this may seem tough, but geopolitics is ever evolving and cannot ignore economic interests. Nothing can be written off.