China has signed a 25-year Cooperation Agreement with Iran in a bid to recruit Tehran to the China-Russia nexus. This sets off alarm tones in the US, putting pressure on the Biden Administration to untangle the US-Iran ties and rejoin JCPOA unconditionally.
- China has signed a comprehensive 25-year strategic collaboration agreement with Iran, signalling a massive shift in the middle-east and global power dynamic.
- Observers believe that Trump’s withdrawal of the US from the Iran nuclear deal in 2018 was the trigger for unprecedented deal with China.
- Furthermore, US sanctions on Iran amid the pandemic resulted in the middle-east country finding domestic support for the deal.
- Biden continuing Trump’s rigid Iran policy can result in Tehran becoming an integral part of the emerging China-Russia nexus.
On Saturday, March 25, 2021, Iran and China signed a 25-year “strategic cooperation pact”. The agreement was signed by Chinese Foreign Minister Wang Yi, during his visit to West Asia, and Iranian Foreign Minister Javad Zarif. Apart from Iran, Wang Yi paid an official visit to Saudi Arabia, Turkey, UAE, and Bahrain and a working visit to Oman.
China-Iran relations and withdrawal of US from JCPOA
It would be pertinent to point out, that even during Chinese President Xi Jinping’s visit to Iran in 2016, references were made to a “comprehensive 25-year document”. Chinese President Xi Jinping happened to be one of the first leaders to visit Iran after signing of the Joint Comprehensive Plan of Action (JCPOA)/ Iran nuclear deal signed in 2015. A gamut of agreements were signed including one to boost trade to 600 billion USD.
Watch: Iran and China sign 25-year cooperation agreement
Many observers believe, that the US withdrawal from the JCPOA in 2018 (during the Trump Presidency), was one of the key reasons for Iran moving closer to China. Prominent commentator Vali Nasr in a tweet made this point: ‘Rouhani and moderates came into office promising improving #Iran’s economy with JCPOA and opening to US, they will leave office with a mega economic deal with #China. Rather than keep Iran neutral failure of US policy has handed it over to China’.
What is the deal about?
This deal did not happen overnight. Both countries have been working on it for some time, worsening of the US-Iran ties of course gave a strong fillip to the same. During Iranian Foreign Minister Javad Zarif’s visit to China in August 2019, the deal is said to have been finalized. While no official details of the agreement have been published, but according to sources it is believed that China will invest 400 Billion USD in Iran. This includes 280 Billion USD in Oil and Gas and 120 Billion USD in other important sectors specifically infrastructure. In return for its investments, China would be guaranteed with the supply of oil at a lower price. Two rail projects, which China is to invest in under the deal are also important in the context of Beijing’s Belt and Road Initiative (BRI). The deal is not important merely from an economic context but seeks to give a fillip to military and naval cooperation between Tehran and Washington.
The deal was approved by Iran’s cabinet in June 2020, at a time when Tehran’s economy was in the doldrums. As a result of US sanctions, and the pandemic had only exacerbated its challenges. The Anti-west sentiment after the imposition of sanctions resulted in support for the agreement. Nevertheless, there was skepticism amongst certain quarters about Iran increasing its dependence upon China. A more effective Western response could have prevented Iran from moving closer to China. Unfortunately, this was not to be the case.
Has the Biden Administration learned any lessons from Trump’s Iran policy
The Trump Administration’s Iran policy played a crucial role in Tehran’s veering towards China. In fact, during the electoral campaign, Biden had stated that Donald Trump’s Iran policy had failed miserably.
Joe Biden, due to foreign policy challenges and constraints, has failed to take any bold steps vis-à-vis Iran. Many believe that the administration should return to the JCPOA unconditionally given that Iran goes to elections soon. However, the US has categorically stated that it will only get back if Iran returns to full compliance. Iran has increased its uranium enrichment beyond levels. Interestingly, China and Russia (members of the P5) with whom US tensions have risen recently have also asked for the US to return to the deal. During a recent meeting of Foreign Ministers of Russia and China, there was a consensus over the fact that the US should “unconditionally return to the Joint Comprehensive Plan of Action (JCPOA) as soon as possible and revoke the unilateral sanctions against Iran”
Will an estranged Iran come back to haunt the US?
Biden has numerous policy priorities. These include dealing with the pandemic and reviving the economy and also key foreign policy challenges Russia and China. Thus there is limited space for mending ties with Iran. However, Biden following a rigid Iran policy will result in Tehran becoming an important part of the China-Russia nexus.
Washington can not dictate Iran’s ties with other countries, including China. However, the Biden administration needs to think more imaginatively in the context of US-Iran ties. Following Trump’s approach vis-à-vis Iran would be a folly. In spite of signing the 25-year agreement with China, Tehran itself would be reluctant of total dependence upon Beijing. Nevertheless, Washington has to show some imagination in dealing with Tehran.