The prospects for the revival of the Iran Nuclear Deal 2015/Joint Comprehensive Plan of Action (JCPOA) seem to be dim after International Atomic Energy Agency (IAEA) Director General Rafael Grossi’s announcement during a recent news conference that Iran has started removing 27 surveillance cameras from nuclear sites all over the country. Iran, on the other hand, has emphatically stated that it is cooperating with IAEA.
The board of governors of IAEA, consisting of 35 members, had passed a resolution last week seeking greater transparency with regard to Iran’s nuclear program. The censure accused Tehran of failing to provide correct information with regard to the development of ‘man made material’ at three undeclared sites in the country. While 30 countries voted in favor of the resolution, three countries abstained, and two countries – China and Russia — voted against the resolution.
The US has also once again underscored the point that a return to the Iran nuclear deal will not be possible if Tehran does not cooperate with IAEA. Said US Secretary of State Antony Blinken while referring to Iran’s decision to remove the above-mentioned 27 surveillance cameras :
The only outcome of such a path will be a deepening nuclear crisis and further economic and political isolation for Iran.
Iranian President Ebrahim Raisi seemed unfazed by the IAEA resolution, and criticism from the West. Said Raisi:
In the name of God and in the name of the nation, Iran will not withdraw from its stance a single step.
Given its numerous economic challenges, Iran has been looking towards a revival of the nuclear deal, since it could open up new economic vistas. In recent weeks there have been protests against rising inflation, and even Iranian retirees have been joining the fray (the government had announced earlier this month that it would raise pensions by 55%, but retirees say that this is not enough, given the level of inflation). Inflation is estimated at well over 45%, and 2 million Iranians have been left jobless as a result of US sanctions and the Covid pandemic.
Iran has been reiterating that if the 2015 Iran deal is not revived, it has other economic options and would adopt a ‘Look to the East policy’ where it would focus on improving ties with China and Russia.
After the imposition of US sanctions in 2021, Iran and China had signed a 25-year agreement, referred to as strategic-cooperation agreement, to strengthen both economic and security links between the two countries. China has also been purchasing oil from Iran in spite of sanctions. For the first three months of 2022, Iran’s oil exports were estimated at 8,70,000, and a significant percentage of these were China bound. Iran has also been looking at a 20-year agreement with Russia. In 2021, bilateral trade between Russia and Iran was estimated at over $4 billion, and both countries have been seeking to strengthen ties in other areas like connectivity under the International North–South Transport Corridor (INSTC).
Tehran, however, can not afford to be solely dependent on China or Russia, and needs to have economic relations with other countries — many which share close ties with the US. A great example of these limitations is China’s decision to reduce its import of oil from Iran after it was able to import the same at much cheaper prices from Russia.
Even if Iran and the other signatories to the JCPOA are unable to revive the 2015 agreement, Iran may have some limited openings with regard to economic linkages with the outside world. The US could allow Iran to import oil in order to keep global oil prices down. It could provide waivers to certain countries to not just purchase oil, but also have limited economic linkages with Iran. After the withdrawal of the US from the JCPOA in 2018, the Trump administration had provided waivers to eight countries for a period of six months to purchase oil from Iran. Significantly, Iran itself had confessed that it had managed to evade sanctions. While addressing the Doha Forum in December 2018, then-Foreign Minister for Iran, Mohammad Zarif, said that
if there is an art that we have perfected in Iran [that] we can teach to others for a price, it is the art of evading sanctions.
In conclusion, Iran cannot afford to be solely dependent upon a handful of countries for putting its economy back on track. Given the current geopolitical turmoil globally, it is important for the US and other Western countries to be pragmatic and not push Iran to a corner.