Dr Mehmood-ul-Hassan Khan
THERE is a hue and cry in the power capitals of the world and of course international media about expected “China-Iran Strategic Deal (CHISD) which may be a “paradigm shift” in the region as well as in the international power politics. It is not “defiance” to prevailing international system but new chapter of “dialogue”, “diplomacy” and “development” which is primarily based on mutual respect and peace. It seems that new chess board of power politics will have now new queen, king and new armies to conquer new castles. There may be new “triangle” of power in the region in the days to come. Washington, Brussels, Tel Aviv and even Delhi have now “rattled” with imminent strategic deal between China and Iran. The New York Times reports that China and Iran have prepared a far-reaching commercial agreement that would offer Iran $400 billion Chinese investment over the next 25 years in return for selling China a large proportion of the oil it produces over the same period at a discounted rate. The partnership is detailed in an 18-page proposed agreement.
Being prominent regional expert of China, I expect that this deal would further enhance Chinese presence in Iranian domestic banking system, telecommunications sector, shipments/ports, railways and dozens of associated projects. Iran will supply its oil on discounted rate to China for the next 25 years. Moreover, it would deepen military cooperation and chance of a foothold in a region that has been a strategic preoccupation of the United States for decades. It calls for joint training and exercises, joint research and weapons development and intelligence sharing. According to the deal, projects include airports, high-speed railways and subways. Furthermore China would develop free-trade zones in Maku and Abadan. It proposes China to build the infrastructure for a 5G telecommunications network, to offer the new Chinese Global Positioning System, Beidou, and to help Iranian authorities assert greater control over what circulates in cyberspace. It also calls for joint training and exercises, joint research and weapons development and intelligence sharing all to fight the lopsided battle with terrorism, drug and human trafficking and cross-border crimes. Chinese President Xi Jinping proposed this partnership while visiting to Iran in 2016 which was subsequently approved by President Hassan Rouhani’s cabinet in June 2020. Being prominent regional expert of China I term it victory of Chinese “collect wisdom” over “wizard trumpism”. It is a grand success of “Iranian nationalism” over “US imperialism” which usually does not care humans but follows commercial policies to gain more and more corporate gains through its visible socio-economic sanctions and invisible military adventures.
It is also a prime example of Iranian “superior diplomacy” which has now succeeded to open a new window of opportunity for Iran and its people to stay away from US suffocating socio-economic and political sanctions. The punishing sanctions regime imposed by the Trump Administration would be severely mitigated by the Chinese investment, expertise, and massive infrastructure upgrade. Tehran’s largest source of revenue, have plunged since the Trump Administration began imposing sanctions in 2018; China gets about 75 per cent of its oil from abroad and is the world’s largest importer, at more than 10 million barrels a day last year. It hopes that new partnership would be a “game” and “fate” changer for Iran to accelerate its declining economy in the days to come.
Many regional experts are of the opinion that it would start new era of cold war in the world where economic vested interests would be vastly manipulated to create hurdles for the other. I am of the opinion that the European Union (EU) would remain neutral because the Europeans are so deeply tied financially and economically to the U.S. that they could not offer any independent arrangement permitting them to offer sanctions relief to the Iranians. Due to superior economy and good governance in its financial system the Chinese would face no such constraints. China has been building a financial system that bypasses the US. Overall the Chinese economy is so large that any negative impact from a cut-off of western trade can easily be mitigated.
It is indeed a “strategic defeat” to the U.S. and its “maximum pressure” policies to Iran. It makes a mockery of the bellicose rants of Secretary of State Pompeo and President Trump. For all their sloganeering, they have little or nothing to show. Iran which, till now, has turned its face to the west hoping to find a way out of its economic malaise, instead turns east and finds a partner strong enough to defy the West. It also renders the newly-revived joint Israeli-U.S. effort of sabotage Iran’s nuclear program almost obsolete. Whatever was lost in the Natanz explosion, which destroyed a major portion of the country’s advanced centrifuge production, can easily be made up with Chinese assistance.
The policy makers of Pakistan should reconsider their assessment of China-Iran emerging partnership. Since Iranian Ambassador to Pakistan has now showed its country’s keen interest to be part of the CPEC, the government must refocus its energies to include CPEC in this agreement. Chessboard of regional power politics is rapidly changing which has now opened new avenues for Pakistan too. The establishment of Pakistan should avail this opportunity carefully, for further strengthening of its bilateral relations with China and Iran.
Pakistan may play a “regional reconciliatory” role among Iran, Saudi Arabia and the UAE with the help of China too because now China has also huge socio-economic dominance, geopolitical involvement and last but not the least geostrategic vested interests at stake. For the time being, India may be at receiving end because of expected strategic deal of China-India but it may regain its partnership with Iran by investing in its various mega projects of ports and railways to be connected with Afghanistan and CIS. Only time will tell how China will maintain balance among its other strategic partners like Saudi Arabia and the UAE which have comprehensive strategic partnership agreements with China after this deal with Iran.
—The writer is Director, Geopolitics/Economics Member Board of Experts, CGSS.
