Iran's Nuclear Issue

Imagine a pious Muslim faced with a ban on fabricating a certain kind of weapon. He is committed to obeying unquestioningly the fatwas of his religious leader and yet discovers that producing such a weapon, or threatening to do so, is a strong lever for gaining benefits from a powerful group living in the neighborhood. Replace "a pious Muslim" with "Iran," and "a powerful group" with the 25-member European Union (EU), and the above sentences aptly sum up the current Iranian-EU relationship.

Enriched by millions of daily encounters in bazaars, Iranians are adept at bargaining and confident in the knowledge, acquired over centuries, that skillful bargaining and brinkmanship go hand in hand. This is what just happened in Paris between the officials of Iran and the the EU troika -- France, Germany and the United Kingdom. The subject was Tehran's nuclear program; the occasion, the run-up to the finalization of an International Atomic Energy Agency (IAEA) report for its 35-strong board of governors on November 15. The Iranians dragged out the bargaining until the last minute before initialing a deal subject to the approval of the Supreme National Security Council (SNSC) in Tehran.

It was a deal that was meant to prepare the way for further negotiations. Iran has agreed to suspend its uranium enrichment and reprocessing programs until a "grand bargain" is reached in which the EU guarantees nuclear, political, and trade concessions in return for Tehran's indefinite suspension of the same programs. Though negotiated by the troika, the agreement's ownership lies with the European Union as a whole. To the undisguised relish of the Iranians, this deal killed the Bush administration's pet plan to refer the Iranian case to the United Nations Security Council for censure or the possible imposition of sanctions for its alleged breaches of the IAEA nuclear protocol.

Both Iran and the EU have a stake in seeing that the next round of negotiations, starting on December 15, succeeds. By clinching a deal with the European Union, the Iranian leadership aims to achieve two strategic objectives: improve Iranian living standards through a Trade and Cooperation Agreement with the EU, and forestall the Bush administration's "hegemonistic designs" by widening of the political gap between the United States and the European Union over Iran.

The EU threesome has stayed firmly on the Iranian diplomatic path, despite American pressures, in order to protect the interests of its companies which already have lucrative contracts in Iran's oil and gas industry and are hopeful of securing more in the future.

Countering American Hegemony

With the collapse of the Soviet Union in 1991, the Islamic Republic's opposition to the imperial ambitions of the two superpowers narrowed to the winner of the Cold War: Washington. At a joint press conference with visiting Russian Defense Minister Igor Sergeyev in February 2000, for instance, Hassan Rouhani, secretary-general of Iran's SNSC, summarized his country's foreign policy in this way: "Cooperation among Iran, Russia, India and China is very important if one hopes to confront the hegemonic policies of America."

That was one year before the arrival of George W. Bush in the White House, his unveiling of a thoroughly unilateralist foreign policy based on "preventive" force, the ominous inclusion of Iran in his "Axis of Evil," and, of course, his illegal invasion of Iraq in 2003. That, in turn, led French President Jacques Chirac to articulate a competing vision of a multi-polar world in which the United States, the European Union, China, India, and Russia all would be poles. In this context, it was no accident that Paris was chosen as the venue for the recent Iranian/EU negotiations.

In Iran, even diehard conservatives now agree that developing cordial relations with the European Union is an effective and necessary way to curb Washington's designs on their country. They are also realistic enough not to underestimate the power of the Bush administration: It successfully pressured Japan to withhold its signature on a $2 billion deal to develop the enormous Azadegan oilfield in Iran, and the EU to suspend its nine-month-old negotiations with Tehran on the Trade and Cooperation Agreement (TCA).

But then, Iranian conservatives and others are equally aware that, singularly, on the issue of Iran, even Britain has stood apart from the U.S. and with its European partners. As a consequence, the British Foreign Minister Jack Straw -- as they are well aware -- is derided by the hawks in Washington, the effective makers of Middle East policy, as "Ayatollah Straw." They wish to see this policy gap between Washington and London maintained, if not widened.

To Each Its Own Interests

At the same time, Iranian leaders want to extract maximum possible benefits for their country in their dealings with the European Union. The most effective way to do this, unsurprisingly, was to acquire as many bargaining chips as possible. And so they resumed the manufacture of centrifuges for enriching uranium in July -- but only after the EU troika had reneged on its part of a deal it had signed with Tehran in October 2003. The three European countries delivered neither promised technological and economic benefits to Iran, nor did they address Tehran's security concerns which are closely tied up with the denuclearization of the Middle East (read: Israel and its sizeable nuclear arsenal). They even failed to get the Iran file downgraded at the subsequent IAEA governors' meeting -- as stated in the agreement.

So on October 31, amid chants of "Allahu Akbar" ("God is great") and "Death to America," all 247 members present in the Iranian parliament unanimously called on the government to restart the country's uranium enrichment program, using its already manufactured centrifuges, and to exercise its right to complete the nuclear fuel cycle enshrined in the nuclear Non-Proliferation Treaty (NPT) to which Iran is a signatory.

A nuclear fuel cycle consists of mining uranium ore (in which only seven out of every 1,000 uranium atoms are the lighter fissile isotopes U235, the rest being the heavier U238), processing it into uranium oxide (yellow cake), transforming it into uranium tetraflouride (UF4) gas, and then uranium hexafluoride (UF6) gas, followed by enriching UF6 to varying degrees of U235 purity: 3.5-4% pure for use in nuclear power reactors, 10-20% pure for use in research reactors, and 90%-plus pure and so usable in nuclear weapons.

In a nuclear power plant, the fuel consists of sealed rods containing hundreds of pellets of 3.5-4% pure uranium. When hit by high energy neutrons, these pellets undergo a controlled chain reaction, emitting intense heat which transforms the surrounding light (ordinary) water into steam. That then runs the plant's electricity generating turbines. Once these fuel rods have yielded their energy, they are called "spent rods." These can be reprocessed with the aim of extracting from them plutonium (Pu239 or Pu241), which could be used as fissile material for nuclear weapons. (Although as yet there are no commercial electric plants using plutonium fuel, Pu239 and Pu241 do contribute towards generating heat for uranium-fuelled plants.) Nuclear fuel thus produces both electric power and more nuclear fuel, and is therefore, in principle, a renewable source of energy.

Therein is the rejoinder to those in the United States who argue that, given Iran's enormous oil and gas resources, its government does not need nuclear power plants. Oil and natural gas deposits, being finite, will not last forever whereas a nuclear fuel cycle can be self-perpetuating. These critics ignore the fact that, despite its vast oil deposits and the largest gas reserves in the world, Russia has a thriving nuclear power industry at home. Furthermore, it exports its technology. Having already built the Iranian nuclear power station near Bushehr, it remains the favorite contractor for the eight more such plants that Iran plans to build in the near future.

Meanwhile, it is Iran's hydrocarbon resources -- an estimated nearly 10% of global petroleum reserves and the second largest gas deposits in the world -- that are at the root of the pressures that British and French oil companies are exerting (discreetly) on their respective governments to cut a diplomatic deal with Tehran on the nuclear issue, and thus torpedo the American plan to take the issue to the UN Security Council with the possibility of economic sanctions or, in the future, worse.

The list of the European oil companies with ongoing oil contracts with Iran -- Royal Dutch-Shell, Elf, Total SA, Agip of Italy, as well as BG (British Gas), Enterprise, Lasmo, Monuument, and so on -– is so extensive that no major European Union member can afford to ignore such interests.

The Europeans are not the only ones. Last month the visiting Chinese Foreign Minister Li Xhaoxing signed an oil-and-gas deal with Iran, and Chinese officials assured Hussein Mousavian, deputy to Rouhani,, in Beijing that China would block any move at the IAEA to refer the Tehran nuclear dispute to the UN Security Council.

Bargaining over the Shape of the World

Whatever agreement emerges out of the "grand bargain" between Iran and the European Union, its nuclear component will be verified by the International Atomic Energy Agency. In his annual report to the UN General Assembly on November 1, IAEA director-general Muhammad El Baradei said that Iran needed to restore the international community's confidence by suspending enrichment after previously providing the IAEA "information that was at times changing, contradictory and slow in coming."

A fortnight later, what the EU troika actually got from Iran was an agreement "to cease to develop or operate facilities to produce fissile material, including any enrichment or reprocessing capability." "Reprocessing," a term that applies to the spent fuel rods, had not been demanded by the IAEA.

The Iran-EU deal came on the heels of a direct intervention by Iranian Supreme Leader Ayatollah Ali Khamanei. In his Friday prayer sermon on November 5, he declared that "developing, producing or stockpiling nuclear weapons" is forbidden under Islam and "our believing nation," and added: "They accuse us of pursuing nuclear weapons program. I am telling them as I have said before that we are not even thinking about nuclear weapons."

What apparently drove Khamanei to this public statement was his determination to frustrate the Bush administration's plan to isolate Iran. He had used a similar argument when, in October 2003, protests arose at home over Iran's agreement to sign an additional protocol allowing IAEA inspectors access to any sites they wished to visit. He insisted then that the decision to cooperate with the IAEA was taken "widely and carefully" in the interests of the Islamic Republic to "foil an American-Zionist maneuver" to isolate Iran.

Since that moment both Iran and the EU threesome have raised their horizons. Besides adding in the reprocessing of the spent nuclear fuel rods from civilian projects, the Europeans plan to introduce the issues of human rights and political reform into their upcoming negotiations with Iran for the "grand agreement."

Tehran's wish list includes the reaffirmation of its right to a nuclear energy program for peaceful purposes; access to imported nuclear fuel at market prices for its reactors; support for Iran's acquisition of a light water research reactor; help with regional security concerns, including combating drug trafficking; the resumption of talks on the Trade and Cooperation Agreement; support for Iran's application for World Trade Organization membership; and the keeping of the Iraq-based Mujahedin Khalq Organization on the EU's list of terrorist organizations.

Much tough talking lies ahead between the EU and the Middle East's most strategic nation. All the more so when, as 34 IAEA governors welcomed Iran's decision on the suspension of all enrichment and reprocessing activities, Jackie Sanders, the Bush administration's representative, promptly followed up her very reluctant yes-vote with a nine-page statement asserting repeatedly that Iran has a clandestine nuclear weapons program without offering any back-up evidence.

Dilip Hiro is the author of Secrets and Lies: Operation "Iraqi Freedom" and After as well as The Essential Middle East: A Comprehensive Guide. His forthcoming book is The Iranian Labyrinth: Journeys Through Theocratic Iran and Its Furies (Nation Books). He is based in London, writes regularly for the New York Times, the Washington Post, the Observer, the Guardian, and the Nation magazine, and is a frequent commentator on NBC, CNN, BBC, and Sky TV.

A version of this piece will appear in print in issue #740 of Middle East International

Copyright C2004 Dilip Hiro

[This article first appeared on Tomdispatch.com, a weblog of the Nation Institute, which offers a steady flow of alternate sources, news, and opinion from Tom Engelhardt, long time editor in publishing and author of The End of Victory Culture and The Last Days of Publishing.]