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iii

Strategic Studies Institute

and

U.S. Army War College Press

PROSPECTS FOR IRAN’S NEW DIRECTION

Keir Giles

February 2015

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ISBN 1-58487-669-7
v

FOREWORD

In November 2014, tense negotiations over the status of Iran’s nuclear program resulted in a 7-month 

extension of a compliance deadline. In June 2015, 

negotiators will once again be grappling with the 

same intractable issues, where neither Iran nor the 

United States and its allies appear able to make the 

substantive concessions that would be necessary for a 

permanent agreement. 

This monograph, completed ahead of the November 2014 deadline, examines some of the underlying 

factors which will be constant in dealing with Iran under President Hassan Rouhani, and which will help 

determine the success or failure of talks in 2015. It 

surveys Rouhani’s eventful first year in office in order 

to provide pointers to what may be possible—and to 

some key limiting factors—for Iran under his leadership. During that time, Rouhani was forced to balance 

his own progressive instincts with the instinctual caution of more conservative elements of the Iranian ruling elite. As a result, foreign hopes for his influence 

on Iran’s place in the world have moved from initial 

optimism to a more sober assessment of the options 

available to him. 

This monograph provides an essential backdrop to 

the forthcoming renewed negotiations by providing 

an introduction to the complex interplay of issues and 

interests which constrain the Iranian leadership. The 

Strategic Studies Institute recommends it not only to 

researchers and policymakers with an interest in Iran, 

but also, given Iran’s central role in a number of cur-
rent Middle Eastern security issues, to those working 

with the Middle East more broadly.

 

 DOUGLAS C. LOVELACE, JR.

 Director

 Strategic Studies Institute and

 U.S. Army War College Press

vi
vii

ABOUT THE AUTHOR

KEIR GILES is the director of the Conflict Studies Research Centre (CSRC), a group of deep subject matter 

experts on Eurasian security formerly attached to the 

United Kingdom (UK) Ministry of Defence. Now operating in the private sector, CSRC provides in-depth 

analysis on a wide range of security issues. After beginning his career working with paramilitary aviation 

in Russia and Ukraine immediately following the fall 

of the Soviet Union, Mr. Giles joined the BBC Monitoring Service (BBCM) to report on political and military 

affairs for UK Government customers. While attached 

from BBCM to CSRC at the UK Defence Academy, he 

wrote and briefed for UK and North Atlantic Treaty 

Organization government agencies on a wide range 

of defense and security issues, focusing on the role of 

adversary human factors. Uniquely, he is a double Associate Fellow of the Royal Institute of International 

Affairs (Chatham House) in London, UK, as well as a 

regular contributor to research projects on security issues in both the UK and Europe. Mr. Giles’s work has 

appeared in a wide range of academic and military 

publications across Europe and in the United States.

ix

SUMMARY

At the end of September 2014, Iranian President 

Hassan Rouhani made his second appearance at the 

United Nations General Assembly in New York. His 

previous visit, in September 2013, had seen the first 

telephone conversation between a U.S. President and 

an Iranian leader since 1979. Despite the domestic 

controversy it caused in Iran, the fact that this was possible was indicative of the significant changes in Iranian foreign policy that had already taken place since 

Rouhani’s election as Iranian president, replacing 

Mahmoud Ahmadinejad. 

President Barack Obama noted that, “I think this 

new president is not going to suddenly make it easy,”1

but the prospects for a significant easing of tensions 

with Iran appeared good. Since his election, the new 

president had sent conciliatory messages to a range of 

Western governments, as well as to neighboring Arab 

Gulf countries, and in particular seemed willing to 

take a different approach on nuclear negotiations to 

that of Ahmadinejad. Nevertheless, President Obama 

still felt it necessary to specify that direct military action by the United States against Iran remained an 

option: “Iran should avoid thinking that the United 

States would not launch a military strike in response 

to Tehran’s nuclear program just because it has not 

attacked Syria. . . . They shouldn’t draw a lesson that 

we . . . won’t strike Iran.”2

One year later, Rouhani returned to New York 

under entirely different circumstances. The option 

of military strikes in response to Iran’s nuclear ambitions had given way to stalemate over the extension 

of a groundbreaking agreement between Iran and the 

West that had seemed to promise a peaceful resolu-
x

tion. Despite positive movement, the intervening 

year had clearly demonstrated the limited freedom 

of movement of the president in improving external 

relations—there was no prospect in 2014 of anything 

so daring as a telephone conversation with President 

Obama.3 A deadline for reaching further agreement 

on the status of Iran’s nuclear program was close, and 

the consequences of failure to reach this agreement 

seemed alarming. 

This monograph reviews the period since Rouhani’s election in terms of these shifts in what seems 

possible and achievable for Iran, in order to draw conclusions about the likely future vectors for Iranian foreign policy. Although external relations regionally and 

internationally feature prominently on the agenda of 

the new Iranian leadership, they cannot be separated 

from Iran’s domestic issues. Key junctures throughout Rouhani’s first year of office emphasize that Iran 

is not a monolithic political body. The Iranian regime 

is constituted of a variety of political forces, and their 

influence on both nuclear negotiations and foreign 

policy more broadly is significant and pervasive. Any 

new approach adopted by an incoming Iranian President thus results from a shift in the thinking of other 

influential Iranian institutions, stemming from internal pressure. President Rouhani’s initiatives enjoy the 

support of Supreme Leader Ayatollah Ali Khamenei, but this support is qualified and may have a 

limited duration. 

ENDNOTES

1. Laura Rozen, “Obama Corresponds with Iran’s Rouhani, Holds Out Hope for Nuclear Deal,” Al-Monitor, September 15, 2013, available from backchannel.al-monitor.com/index.

php/2013/09/6265/obama-says-exchanged-lettters-with-irans-rouhani/.
xi

2. “Obama Says Syria Deal Could Offer Lesson for Iran Talks,” 

Reuters, September 15, 2014, available from www.reuters.com/article/2013/09/15/us-syria-crisis-usa-idUSBRE98D09C20130915.

3. “Rouhani: Time Not Right for Another Phone Call with 

Obama,” The Times of Israel, September 27, 2014, available from 

www.timesofisrael.com/rouhani-time-not-right-for-another-phone-callwith-obama.

1

PROSPECTS FOR IRAN’S NEW DIRECTION

Introduction. 

At the end of September 2014, Iranian President 

Hassan Rouhani made his second appearance at the 

United Nations (UN) General Assembly in New York. 

His previous visit, in September 2013, had seen the 

first telephone conversation between a U.S. President 

and an Iranian leader since 1979. Despite the domestic controversy it caused in Iran, the fact that this 

was possible was indicative of the significant changes in Iranian foreign policy that had already taken 

place since Rouhani’s election as Iranian president, 

replacing Mahmoud Ahmadinejad. 

President Barack Obama noted that, “I think 

this new president is not going to suddenly make it 

easy”1—but the prospects for a significant easing of 

tensions with Iran appeared good. Since his election, 

the new president had sent conciliatory messages to 

a range of Western governments, as well as to neighboring Arab Gulf countries, and in particular seemed 

willing to take a different approach on nuclear negotiations to that of Ahmadinejad. Nevertheless, Obama 

still felt it necessary to specify that direct military 

action by the United States against Iran remained 

an option, he said: 

Iran should avoid thinking that the United States 

would not launch a military strike in response to Tehran’s nuclear program just because it has not attacked 

Syria. . . . They shouldn’t draw a lesson that we . . . 

won’t strike Iran.2

One year later, Rouhani returned to New York 

under entirely different circumstances. The option 
2

of military strikes in response to Iran’s nuclear ambitions had given way to stalemate over the extension 

of a groundbreaking agreement between Iran and the 

West that had seemed to promise a peaceful resolution. Despite positive movement, the intervening 

year had clearly demonstrated the limited freedom 

of movement of the Iranian president in improving 

external relations—there was no prospect in 2014 of 

anything so daring as a telephone conversation with 

Obama.3 A deadline for reaching further agreement 

on the status of Iran’s nuclear program was close, and 

the consequences of failure to reach this agreement 

seemed alarming. 

This monograph reviews the period since Rouhani’s election in terms of these shifts in what seems 

possible and achievable for Iran, in order to draw conclusions about the likely future vectors for Iranian foreign policy. Although external relations regionally and 

internationally feature prominently on the agenda of 

the new Iranian leadership, they cannot be separated 

from Iran’s domestic issues. Key junctures throughout Rouhani’s first year of office emphasize that Iran 

is not a monolithic political body. The Iranian regime 

is constituted of a variety of political forces, and their 

influence on both nuclear negotiations and foreign 

policy more broadly is significant and pervasive. Any 

new approach adopted by an incoming Iranian president thus results from a shift in the thinking of other 

influential Iranian institutions, stemming from internal pressure. Rouhani’s initiatives enjoy the support 

of Supreme Leader Ayatollah Ali Khamenei, but this 

support is qualified and may have a limited duration. 

It follows that in order to assess the current prospects 

for maintaining Iran’s trajectory toward cooperative 

engagement and compromise, we need to begin with 

the manner of Rouhani’s arrival in office. 
3

Retrospective: An Unexpected Victory. 

June 2013 marked an unexpected turn of events 

in Iranian politics, one that even some of the most 

optimistic commentators and analysts had failed to 

predict. Hassan Rouhani—a moderate and pragmatist cleric whose views on individual freedom, social 

issues and foreign policy diverged substantially from 

the ultra-conservative political establishment of the 

Islamic Republic—won a landslide victory in an election which many thought would be boycotted by the 

majority of Iranians supporting change and reform in 

the country’s political system. 

This result was highly significant, for a number 

of reasons: 

• Rouhani was the only candidate representing 

pro-reform policies, against five conservative 

rivals.

• The election was held against the backdrop of 

the biggest political unrest the Islamic Republic 

had experienced since its victory in 1979. The 

Green Movement, which erupted across the 

country following the disputed 2009 presidential election resulting in Mahmoud Ahmadinejad’s second term in office, had been suppressed 

by the regime, leaving the country divided and 

pro-reform voices in isolation.

• Opposition leaders Mir Hossein Mousavi and 

Mehdi Karroubi, the two reformist candidates 

of the 2009 election who led the subsequent 

street protests, had been placed under house 

arrest by the authorities since 2011.

• Some members of the public who had taken 

part in the protests felt disillusioned with the 
4

political system, believing that the elite would 

rig any further election if they saw fit. Therefore, there were widespread calls for boycotting 

the election. Many opposition and pro-reform 

forces were of the belief that taking part in the 

election would be a betrayal of Mousavi and 

Karroubi and would only strengthen the ultraconservative establishment.

Nevertheless, nearly 37 million eligible Iranians 

voted in the election, an unexpected turnout of 72 percent. Rouhani, who had the backing of former presidents Akbar Hashemi-Rafsanjani and Mohammad 

Khatami, secured 51 percent of the votes, putting him 

well above the second candidate Mohammad Bagher 

Ghalibaf, the mayor of Tehran, with 16 percent.4

During election rallies, Rouhani had promised his 

supporters to find a way to end international sanctions 

against the Iranian economy, which had halved its oil 

revenues, thus bringing the economy to its knees. This 

new direction in international relations for Iran was 

signaled without delay. In a press conference 3 days 

after his victory, Rouhani pledged to resolve confrontation over Iran’s nuclear program through “constructive interaction” with the world. He said that Iran was 

ready to show “more transparency” on its nuclear activities, while still ruling out suspension of uranium 

enrichment procedures. Most Western powers “cautiously” welcomed the change of tone in the Iranian 

president’s remarks, which were in direct contrast to 

Ahmadinejad’s aggressive and often hostile rhetoric 

toward the West.5

Rouhani was sworn into office on August 4, 2013. 

In his first speech as president in the Iranian parliament, the Majlis, Rouhani urged the West to use the 
5

“language of respect,” rather than sanctions, toward 

Iran.6 At the same time, he said that amending ties 

with regional neighbors would be his first priority in 

foreign policy, after relations with many Arab countries, prominently Saudi Arabia, had worsened under 

Ahmadinejad.7

Syria: The First Challenge. 

This ambition was immediately put to the test by 

the civil war in Syria. While Rouhani was still busy 

forming his cabinet and proposing his ministers to the 

Majlis, the United States and other Western powers 

accused President Bashar al-Assad’s forces of having 

used chemical weapons, which had previously been 

defined as a “red line” by U.S. President Obama.8 The 

result was the highest likelihood to date of a U.S. strike 

on Syria. 

As Iran’s key ally in the region, Syria is instrumental in what Iran calls “the resistance front against the 

Zionist regime,”9 primarily through support for the 

Lebanese Hezbollah. Therefore, Iran had defied global 

outrage against the Syrian government and President 

Bashar al-Assad since the beginning of the Syrian crisis, knowing that the departure of Assad would leave 

allies weaker and more vulnerable against Israel and 

the West. 

Iran and Israel.

Iran has had no relations with “the Zionist regime,” otherwise known as Israel, since the Islamic 

revolution in 1979. Israel is regarded as “an occupying 

regime” that has waged war on Muslims. The founder 

of the Islamic Republic of Iran, Ayatollah Ruhollah 
6

Khomeyni, referred to Israel as “a cancerous tumor”; 

and “liberation of Bayt al-Muqaddas,” an Iranian term 

for Jerusalem, is considered one of the objectives of 

the Islamic revolution.10

Public remarks by former President Ahmadinejad in 2005, to the effect that Israel should be “wiped 

off the map,” did little to improve the atmosphere.11

The two countries are prone to confrontational verbal exchanges, and the threat of Israeli air strikes 

on Iran’s nuclear facilities became serious during 

Ahmadinejad’s presidency. 

Immediately after taking office, President Rouhani 

said that his administration would do all it could to 

prevent a possible U.S. strike on Syria. He acknowledged that chemical weapons had been used in Syria, 

but refused to blame government forces.12 The Iranian 

authorities—backed by some major powers such as 

Russia—maintained that it was the rebels, backed by 

Western powers, who had used these weapons, in order to provide a pretext for the United States to attack 

the Assad government.

This challenge, at the very start of Rouhani’s presidency, provided an immediate confirmation of the 

continuing factionalism of Iranian politics, and the undiminished influence of hard-liners. While Supreme 

Leader Ayatollah Ali Khamenei confined himself to 

saying that the United States would “suffer loss” if 

it chose to attack Syria,13 some conservative elements 

within the establishment went as far as threatening 

that any U.S. strike against Syria would result in retaliatory attacks on Israel. Chief of Staff of the Iranian 

Armed Forces, Major-General Hassan Firouzabadi, 

stated that “any military measure against Syria will 

draw the Zionists deep into the fire [as well].”14
7

If this threat had become reality, Israel, far more 

accessible than the United States, would have been 

Iran’s main target. While unlikely to directly wage 

war on Israel, Iran could have used the militias of its 

proxies in the region, like Hezbollah and Hamas. With 

the undoubted influence of hardliners on Iranian action, despite presidential rhetoric, any strike on Syria 

could therefore have set the stage for full-scale hostilities in the region.

At the same time, while Russia’s intervention in 

producing a plan for removal of chemical weapons 

from Syria prevented a potential war, Iranian influence also played a significant role in the eventual 

peaceful resolution. Iran exerted regional sway and 

maintained a stance which was more or less in line 

with that of Russia, making sure that in keeping with 

its strategic interest of saving its key ally Syria from 

war, it had backing from a significant partner like 

Russia if the United States went ahead with strikes. 

In Iranian and Russian perceptions, the combination 

of strong diplomatic maneuvering and the threat of 

action against Israel was successful in constraining the 

United States. Rouhani thus headed to New York for 

his first UN General Assembly session buoyed by the 

news that a potential disaster in his first year in office 

had been successfully averted. 

Breakthrough in Nuclear Talks. 

From the beginning of his presidency, Rouhani 

made it clear that finding a resolution to the nuclear 

standoff with the West and easing the sanctions on the 

Iranian people was his main focus in foreign policy. 

Although Iran under Ahmadinejad had attended a 

few rounds of talks with the European Union (EU), the 
8

two sides seemed to have reached a deadlock, with no 

short-term solution in sight. 

This changed quickly under the new administration. Rouhani assigned the task of handling nuclear 

negotiations to the Foreign Ministry, thus putting Foreign Minister Mohammad Javad Zarif in charge. Before that, nuclear negotiations had been in the charge 

of Iran’s Supreme National Security Council, a council 

headed by the president whose members are directly 

appointed by the Supreme Leader. Rouhani appeared 

to have taken this decision for two reasons: 1) He 

would have direct supervision on the progress of the 

nuclear talks; and 2) He trusted his personal friend, 

Zarif, to push Rouhani’s agenda forward. Zarif, a veteran diplomat, had served in a range of posts in the 

Foreign Ministry. Educated in the United States, he 

had been Iran’s permanent representative at the UN 

for several years and retained good connections with 

a large number of senior foreign diplomats. 

It should be noted that despite this change, Supreme Leader Ayatollah Khamenei maintains the final 

say in all decisions regarding the nuclear program. It 

appeared that Rouhani had been given approval by 

Khamenei to move nuclear issues forward with a 

more open, transparent, and engaging agenda after 

2 years of international sanctions had hit the Iranian 

economy hard. 

Rouhani’s nuclear maneuverings started as early 

as September 2013, on the sidelines of the UN General Assembly in New York. Zarif held a meeting 

with all the foreign ministers of the P5+1 (the five 

permanent members of the UN Security Council: 

the United States, the United Kingdom (UK), France, 

Russia, and China, plus Germany) and EU foreign 

policy chief Catherine Ashton. The meeting itself al-
9

ready constituted an unprecedented breakthrough, 

as most major Western countries had refused to hold 

high-ranking meetings with Iranian officials during 

Ahmadinejad’s presidency. 

Zarif then held a bilateral meeting with U.S. Secretary of State John Kerry to discuss the nuclear issue, which made headlines the world over and represented a real change in Iranian foreign policy. This 

too was a first; with very few exceptions, direct negotiations with American officials had been a taboo in 

Iranian politics. 

Iran and the P5+1 set out a platform in New York 

for further rounds of talks in the upcoming months. 

The two sides met in Geneva, Switzerland, in October 

the same year, but despite apparent progress, failed to 

agree on a deal. All the same, some Western diplomats 

attending the talks stated that they had seen “the most 

serious, intense” negotiations ever held with Iran.15

The response to these new developments within 

Iran confirmed the support for Rouhani’s initiative 

from Ayatollah Khamenei. Opposition to the talks 

included hardliners opposed to Rouhani’s “soft tone” 

on the West, who let it be known that they were “concerned” the government would offer significant concessions to the West for a deal. This was dismissed by 

Ayatollah Khamenei, who showed unequivocal backing for the talks: “No one should accuse our negotiating team of reconciling or compromising. These are 

our own children, the children of the revolution, who 

are doing a very difficult task.”16

Even with the backing of Khamenei, Rouhani had 

to ensure his negotiating team would not cross the 

Islamic Republic’s immutable red lines. Khamenei, 

meanwhile, insured his position by making it clear 

that he was not optimistic about the outcome of the 
10

negotiations “because the Americans are not honest 

in talks and cannot be trusted.”17 This would allow 

Khamenei the best of both worlds; if the talks failed to 

reach a resolution he would tell the nation that he was 

pessimistic from the very beginning, and if the two 

sides did agree to a deal, he could say that it was he 

who allowed the Rouhani administration to go all-out 

to secure it. 

The real breakthrough, though, took place in November 2013 in Geneva. After marathon talks which 

included all the foreign ministers of the six world 

powers, Iran and the P5+1 agreed on a ground-breaking 6-month deal on November 24, which they named 

the “Joint Plan of Action.”18 Iran agreed to curb some 

aspects of its nuclear program in return for relief 

from some sanctions. After the deal came into effect 

on January 20, 2014, the two sides would then engage 

in further negotiations to find a comprehensive solution which would effectively resolve the decade-long 

standoff between Tehran and the West. July 20 was 

chosen as the deadline for agreeing to a comprehensive resolution. According to one assessment, the key 

factor in reaching the agreement was a decision by 

both sides to isolate nuclear negotiations from other 

contentious issues.19 This allowed progress without 

either side’s negotiating position falling hostage to 

external considerations. 

The impact of the agreement within Iran was entirely in keeping with its groundbreaking nature. The 

picture of Zarif shaking hands with Kerry after the 

deal had been agreed upon made the front page of the 

majority of Iranian papers the following day. The news 

was announced in Iran by the president himself, who 

hailed it as “a victory for the Iranian nation.” Rouhani 

said that, as a result of the Geneva deal, the “archi-
11

tecture of sanctions had cracked,” and urged foreign 

investors to travel to Iran and use the opportunity 

to trade with Iranian businesses.20 On their return to 

Tehran, the negotiating team led by Zarif was mobbed 

by crowds celebrating the fact that their country had 

managed to strike a deal with the West.21

Predictably enough, however, while it seemed that 

the Joint Plan of Action deal had the backing of the 

majority of Iranians, it made the hardline and ultraconservative campaigners more vocal in their criticism. They believed that Iran had given up too much 

for too little, some of them going as far as to say that 

Rouhani and the negotiating team had “betrayed our 

nuclear martyrs”—a reference to the assassinations of 

a number of Iranian nuclear scientists, for which Iran 

holds Israel responsible.22

Restarting Regional Relations.

President Rouhani’s next foreign policy target following the nuclear deal in Geneva was active diplomacy in Iran’s immediate neighborhood. Some Arab 

states had expressed their concern about Iran’s nuclear program in the past, specifically under Ahmadinejad’s hardline administration. Now, with an interim 

deal in hand, Rouhani could start rebuilding relations 

with regional states. Zarif began an intensive round 

of diplomatic visits. He visited Kuwait and Oman, 

and met his counterparts from Turkey and the United 

Arab Emirates (UAE) in Tehran. Zarif even expressed 

willingness to make a visit to Saudi Arabia.23

Iran had offered unconditional support to President Bashar al-Assad since the beginning of the civil 

war in Syria in 2011. The issue was an obstacle to 

relations with several countries in the region. Now, 
12

although the Syrian crisis was still at the heart of 

Tehran’s diplomatic efforts, Iran also hoped that rectifying its disturbed relations with regional states 

would pave the way for reaching a lasting agreement 

with the West on the nuclear issue—bearing in mind 

that several Gulf states, especially Saudi Arabia, are 

perceived as key U.S. allies in the region. 

Talks with Turkey were held in attempts to address the Syria issue. Turkish Foreign Minister Ahmet 

Davutoglu travelled to Tehran to attend the 21st meeting of the Council of Ministers of the Economic Cooperation Organization (ECO) in November 2013, and 

held a joint press conference with his Iranian counterpart, Zarif, which reported progress. “We have shared 

stances on many issues and also some differences on 

the crisis in Syria and we hope that we can resolve 

these differences with the help of each other,” Zarif 

said.24 Davutoglu further announced that Rouhani 

would visit Turkey in January 2014. 

With Arab states in the region, the main focus 

besides direct bilateral relations was to address concerns about Iran’s nuclear program. UAE Foreign 

Minister Shaykh Abdallah Bin-Zayid Al Nuhayyan 

arrived in Tehran on November 28 on a rare official 1-day visit. The two countries have had a long 

dispute over a number of bilateral issues, including 

sovereignty over three islands in the Persian Gulf. In 

his meeting with Zarif, Al Nuhayyan and his Iranian 

counterpart called for opening a new chapter in bilateral ties. Zarif followed up with a visit to Kuwait and 

Oman. Relations between Iran and Kuwait had been 

strained for the previous 3 years, after accusations of 

Iranian espionage activities in Kuwait. Meanwhile, 

the Omani Sultan was the first foreign head of state 

to visit Tehran after Rouhani took office. Oman was 
13

reportedly instrumental in making possible Iran’s 

nuclear deal with the P5+1, thanks to months of secret 

talks between U.S. and Iranian officials in the Omani 

capital, Muscat.25

Iran and Saudi Arabia have been rivals over past 

decades, both aspiring to be the major power in the 

Persian Gulf. In addition to Iran’s disputed nuclear 

programs, the two oil-rich states were at loggerheads 

over influence in some other countries including Iraq, 

Bahrain, and Syria. Saudis consider Iran-U.S. rapprochement as a risk which might disturb the balance 

of power in the region in favor of Iran.26 As a consequence, Saudi Arabia had expressed concerns about 

the nuclear talks in Geneva. Despite these concerns, 

Saudi Arabia cautiously welcomed the deal with the 

P5+1, calling it “a first step towards a solution if there 

are good intentions.”27

Rouhani had indicated in his first press conference 

after the June elections that amending ties with Saudi 

Arabia would be a priority for the new government. 

This reflects the fact that better relations with regional 

states would facilitate striking a long-term deal with 

the West. According to a front-page article in the reformist Sharq daily in November 2013: 

If instead of disturbing our diplomatic ties with the 

influential countries in the region and world such as 

Saudi Arabia, France and Britain we had made efforts 

to minimize the number of our obstinate enemies, we 

would not have reached a point where our numberone enemy [the U.S.] would be ready for a deal but 

other states overturn the table.28

Iran is also cognizant of Saudi influence both in the 

region, such as through the Gulf Cooperation Council (GCC), and in broader international organizations, 
14

such as the Organization of Islamic Cooperation (OIC) 

and the Arab League. Potentially, reaching an agreement with Saudi Arabia over a number of disputed 

regional issues could help both sides to maintain their 

position in the region. A visit by Zarif, or by former 

President Akbar Hashemi-Rafsanjani, known to have 

good relations with Saudi leaders, would explore 

channels toward that goal and pave the way for a 

possible detente.

Thaw with the UK.

One of the major changes under Rouhani was resumption of ties between Tehran and the UK after relations between the two countries had been at their 

lowest level for some considerable time on Rouhani’s 

entry into office. Resuming diplomatic ties with the 

UK would be considered significant in Tehran due 

to Britain’s perceived status as the closest U.S. ally in 

Europe, with the potential to act as a bridge between 

Tehran and Washington for further developments in 

relations. In addition, as a member of the P5+1 group, 

the UK was essential to any possible nuclear deal. 

In December 2011, the British government had 

announced that it was imposing unilateral sanctions 

on the Iranian Central Bank. The decision came at the 

height of international sanctions on Iran, where Iranian banks and businesses were directly targeted by 

the West. In retaliation, the Majlis passed a bill that 

restricted relations with Britain to the level of chargé 

d’affaires. A few days later, a group of hardline students ransacked the British Embassy and another UK 

diplomatic facility in Tehran, chanting “death to Britain.” Despite occasional animosity between the two 

countries and regular demonstrations, this was the 
15

first time the embassy had been actually overrun since 

1979.29 In response, UK Foreign Secretary William 

Hague closed the embassy, and asked Iranian diplomats in London to return home, a move seconded 

by Canada. 

Even after these events, Hassan Rouhani was well 

placed to rebuild ties; Rouhani had lived in Britain, 

and acquired his doctorate from Glasgow Caledonian 

University in Scotland. Among his congratulatory 

messages on winning the presidential election was 

one from UK Prime Minister David Cameron, hoping that ties with Iran would improve on “a step by 

step” basis.

Foreign Ministers Zarif and Hague met on the 

sidelines of the UN General Assembly session in 

New York in September 2013, and agreed to work 

toward restoration of diplomatic ties. In October, the 

two countries agreed to appoint nonresident chargés 

d’affaires, Mohammad Hassan Habibollahzadeh and 

Ajay Sharma, who would work toward the reopening 

of embassies and full restoration of ties.30 Habibollahzadeh and Sharma met several times in Tehran and 

London, both noting that the process was proceeding 

positively. Finally, in February 2014, the Iranian embassy building in Kensington, London, reopened and 

began offering limited services to Iranian nationals 

living in Britain. The British embassy in Tehran remains closed to date, which may reflect the intention 

of the British government to await the result of current 

nuclear negotiations. A renewed nuclear deal would 

likely pave the way for full restoration of diplomatic 

ties between the two nations. In this atmosphere, a 

meeting in September 2014 between Rouhani and UK 

Prime Minister David Cameron on the fringes of the 

UN General Assembly, while progressive, was brave 
16

considering the deep suspicion with which the UK is 

regarded in Tehran.31

Ties with the United States, Phone Call with 

Obama.

The first sign of change in Iran’s bilateral relations 

with the United States came as early as July 2013; in 

a press conference, the new president said that Iran 

and the United States could not remain enemies forever, and that any thaw in relations would depend on 

the way the United States interacted with Iran. Meanwhile, Obama said that he “cautiously” welcomed 

the arrival of the new Iranian president, stressing that 

doors would be open for Iran if it was serious in taking 

on a new approach in relation to its nuclear program.32

This cautious beginning was entirely overshadowed almost 2 months later during Rouhani’s visit to 

New York for his first UN General Assembly speech. 

Rumors of a possible meeting between Rouhani 

and Obama had been circulating in the media. This 

would have been a true breakthrough, as no Iranian 

president had ever dared even to contemplate aloud 

a face-to-face meeting with his counterpart from “the 

great Satan,” the root of all evil. Naturally enough, 

any direct interaction with Satan would have been 

anathema to the Islamic Republic. 

Nonetheless, in the early hours of the final day of 

Rouhani’s visit to New York, a Twitter account belonging to Rouhani announced in English that he and 

Obama had spoken over the phone. This marked the 

first such conversation between an Iranian and American leader since the Shah’s departure and the subsequent toppling of the Pahlavi dynasty in 1979. The 

phone conversation, and the succession of chummy 
17

tweets between the two leaders that followed as Rouhani departed for the airport, was hailed as “historic” 

by world media, and taken as denoting a serious intent by Rouhani to fix the long broken ties with the 

world’s greatest power. 

The news also caused enthusiasm and excitement 

in Iran, but this was followed swiftly by concern. Only 

a few hours later, the tweets which included details of 

the phone conversation between Obama and Rouhani 

were deleted without explanation. It was suspected 

that Rouhani had encountered a significant backlash 

from the ultra-conservative elements in the establishment, who considered a major red line had been 

crossed by the president.33 Speculation on whether 

Ayatollah Khamenei had authorized the conversation 

ended when Khamenei stated that despite his support 

for the government’s active diplomacy, “some of the 

things that happened in New York were not right.”34

The ground-breaking Geneva deal, which was 

achieved after direct talks between Iranian and U.S. 

negotiators, had raised hopes about the possibility of 

the two sides widening talks into bilateral relations. 

But once again, the Supreme Leader stressed that the 

negotiating team was only allowed to talk to American 

representatives about the nuclear issue, and no other 

topic was on the table. As a consequence, there has 

been little progress in bilateral ties since the historic 

phone call and the Geneva deal, despite regular meetings between the two countries’ negotiators as part of 

the ongoing nuclear talks. 

Iran still accuses the United States of supporting 

Israel and creating unrest in the region to serve its 

own purposes. The majority of Iranian political figures have repeatedly hinted that any failure to reach 

a comprehensive deal on the nuclear program should 
18

be blamed on the United States, because, they claim, 

Washington is derailing the talks with “unreasonable 

demands.” Despite media rumors of the possibility of 

Tehran and Washington working together to counter 

the threat posed by the Islamic State in the region, Iran 

has said that it does not need to cooperate with the 

United States and would rather work with its regional 

allies to fight the Islamic State. Nevertheless, Rouhani’s 2014 UN General Assembly speech appeared 

to offer a specific invitation for cooperation against 

the Islamic State, conditional on progress in nuclear 

negotiations. He said:

If our interlocutors are motivated and flexible, we can 

reach a longstanding agreement within the time remaining. Then an entirely different environment will 

emerge for cooperation at regional and international 

levels, for example in combating violence and extremism in the region.35

Seyed Hossein Mousavian, former head of the Foreign Relations Committee of the Iranian Supreme National Security Council, suggests that without active 

Iranian support, no major peace effort in the Middle 

East can succeed—with particular reference to support for the U.S.-led coalition against the Islamic State. 

His suggestion for achieving this, as well as detailed 

recommendations for a roadmap for nuclear negotiations, is engagement with Iran, recognizing and accepting the extent of Iranian power and influence in 

the region.36

Iran and the Islamic State.

Iran has made it obvious that it takes the threat of 

the Islamic State very seriously, although at the same 
19

time shrugging off any concern about being targeted 

by Islamic State militants. Iran has suggested that 

the best way to counter the Islamic State is to leave 

it to the governments in Iraq and Syria. This reflects 

a suspicion of any foreign intervention, based on 

awareness of the possible risks to Iranian ally Assad. 

Despite this declaratory policy, photographs of General Ghasem Soleimani of the Islamic Revolutionary 

Guards Corps (IRGC) have been circulated via social 

media showing him alongside Shia Iraqi fighters combating the Islamic State. Whether he has put together 

his own force to fight the Islamic State, or he is merely 

providing assistance is unspecified in open sources, 

but this would reflect the unlikelihood of Iran actually 

being willing to leave constraint of the Islamic State to 

Iraq and Syria’s own efforts as claimed, which would 

inevitably allow the Islamic State to subdue still more 

territory.37 A possible trip by Zarif or even Rouhani 

himself to Saudi Arabia, which is appearing increasingly likely, would present an opportunity to discuss 

ways to fight the Islamic State, or come to an agreement on the possibility of Tehran taking part in some 

form of a coalition against the Islamic State, with or 

without the United States. 

Outlook: Relations with Saudi Arabia and Turkey.

Iran will necessarily be a key player in any eventual resolution of the Syrian conflict, whether political or military, notwithstanding its exclusion from the 

Geneva 2 conference in January 2014. Any political 

resolution of this kind would entail Iran reaching an 

understanding with other key regional players, particularly Saudi Arabia and Turkey. Statements on the 

Syria issue by Iranian officials have been very consis-
20

tent, and can be read as indicating that Iran sees no 

need at present to offer any substantial concessions 

or deviations from its declared support for the Assad 

government. Thus, there is a potential conflict between Rouhani’s policy of regional engagement and 

rapprochement, and the tougher stance of the military establishment which stresses defending Iran’s 

strategic interests.

The official government position has been repeatedly articulated by Zarif. He has stressed the need for 

a political solution, to be determined by the Syrian 

people after the withdrawal of what he has termed 

“all foreign forces.”38 Iran would be prepared to use 

its influence with Damascus to bring about a ceasefire 

and the withdrawal of foreign fighters, Zarif added, if 

others used their influence on other combatants with 

the same goal. At the same time, he echoed Russian 

warnings of the rise of “extremism” in Syria, describing it as “a regional and global menace.”39

This specter of an increase in the global terrorism 

threat is also used by Iranian military sources, although more forcibly and with a different emphasis. 

This military viewpoint is frequently voiced by Major General Yahya Rahim-Safavi, former head of the 

IRGC and now military adviser to Ayatollah Khamenei. In February 2014, Rahim-Safavi said that the extremist “takfiri” groups operating in Syria had been 

“masterminded by the United States while financially 

supported by the Zionist regime and certain Arab 

states.”40 Previously, he had warned that some Arab 

kingdoms could disappear by the year 2030.41

Any decision to improve ties with Saudi Arabia 

in particular would need to be taken by the Supreme 

Leader himself, with input from military as well 

as government and diplomatic figures. This would 
21

account for the fact that no official ministerial visit has 

yet taken place, despite statements of readiness. A recent Saudi decree criminalizing citizens going to fight 

in foreign countries, and those encouraging them, 

could be seen as a first step toward creating a favorable environment for talks with Iran. It could also be 

seen as a tacit acknowledgement that the emphasis 

on the threat from terrorism stated by Iran, Syria, and 

Russia is currently winning the argument.

Iran’s relations with Turkey are much warmer 

than those with Saudi Arabia. But a visit to Tehran of 

a Turkish delegation headed by the then prime minister Recip Tayyip Erdogan showed that there are still 

differences to overcome. A speech Erdogan was due 

to give at the Iranian Foreign Ministry was cancelled, 

reportedly because his meeting with Rouhani took 

longer than scheduled.42 Iranian First Vice-President 

Eshaq Jahangiri said at a news conference that agreement had been reached on a natural gas deal. But 

Turkish Energy Minister Taner Yildiz then told reporters that there had been a mistranslation, and there 

had merely been talks about the deal. Furthermore, 

Iranian interest in a resolution in Syria needs to be 

placed in context; Syria is subsidiary to the nuclear issue as Iran’s top foreign policy concern. Any efforts 

to pave the way for a negotiated solution to the Syria 

issue run the risk of falling hostage to the progress of 

the nuclear talks. Meanwhile, Iranians feature heavily 

among the “foreign forces” active in Syria. 
22

The Extent of Iran’s Military Involvement in Syria.

On May 27, 2014, Iranian website Rajanews carried 

a very brief report, saying that a commander in the 

IRGC, Abdollah Eskandari, had been “martyred” in 

Syria. Eskandari’s death attracted little media attention. A commemoration ceremony in his home province of Fars on June 1 was the subject of a 2-minute 

report on the local television channel. The ceremony, 

and a message of condolence from the country’s 

defense minister, was also reported by the Islamic 

Republic News Agency (IRNA) and Mehr news 

agencies.43

The official Iranian line is that it has no combat 

presence on the ground in Syria, although it acknowledges providing military advice and assistance, and 

that Iranians have gone there to fight as volunteers. 

But following Eskandari’s death, a report in the Gulf 

quoted Syrian opposition sources as saying that he 

was the 60th Iranian “officer” to have been killed in 

Syria.44 Iranian media sources have only reported 

the deaths of 21 fighters in Syria since the beginning 

of 2013. This reporting mostly takes the form of announcement of their funerals once the bodies have 

been repatriated, which is usually done within 2 to 3 

days of their deaths. Neither of these figures is substantial, in the context of the death toll in Syria’s civil 

war, which is now put at over 150,000. Analysts estimate that approximately one-third of those casualties 

have been incurred by forces fighting on the government side, whether regular or irregular.

Although there are variations in the exact terminology used, Iranians killed in Syria are almost always 

described as defenders of the Shia shrines in Damascus, principally the shrine of Sayyidah Zaynab in the 
23

southern suburbs, but also that of Sayyidah Ruqayya 

on the edge of the Old City.45 The term “defenders of 

the shrine” is generic, and should not be taken as an 

indication of geographic location of their deaths. In 

most cases there are few details of the circumstances 

in which they were killed. The fighters are also referred to as volunteers, but a study of the published 

obituaries and eulogies, along with the photographs 

that accompany them, shows that they almost all have 

clear military connections.

While the Iranian authorities seem to impose no 

restriction on the reporting of the deaths of Iranians in 

Syria, they do seem sensitive to wider discussions or 

revelations about the extent of Iran’s role in the conflict. On a number of occasions, news agencies have 

withdrawn or modified reports related to the war. In 

May 2014, Fars published a report in which a former 

IRGC commander, Brigadier General Hoseyn Hamedani, spoke of Iranian support for Syria, saying that 

“Iran has established a second Hezbollah in Syria,” 

and “some 130,000 Basij volunteers have been trained 

and are waiting to enter Syria.” Twenty-four hours 

later the report had been removed from the website.

Earlier, in February, Fars removed a paragraph 

from remarks by Member of Parliament (MP) Mahmud 

Nabavian after they had been widely quoted by other 

Iranian media outlets. Nabavian said, in the redacted 

remarks: “We brought 150,000 Syrians to Iran and provided them with military training. We trained 150,000 

over there and also sent 50,000 Hezbollah forces 

there.” Subsequently, Majlis Speaker Ali Larijani told 

a closed session of parliament that MPs should “exercise more caution” in their statements and “observe 

security concerns.”46 It is worth pointing out that the 

numbers quoted by Nabavian may be exaggerated. 
24

Western analysts estimate that Hezbollah has had no 

more than about 5,000 troops in Syria at any one time, 

while the strength of the Syrian paramilitary forces 

trained by Iran is thought to be around 100,000.

Another instance occurred when the Anarma

website, based in Kerman Province, quoted an IRGC 

commander as telling a local memorial ceremony in 

March 2014: “Everybody saw when Commander Soleimani entered Syria; the enemy [the United States] 

paid attention and did not talk about a military invasion against Syria anymore.” Ghasem Soleimani, as 

the commander of the IRGC’s Quds Force, is responsible for external and special operations, and has been 

described by opposition groups as the “de facto ruler” 

in Damascus. Two days later, the website posted an 

edited version of the report with the reference to Soleimani removed.47 Despite this apparent sensitivity 

over the mention of Soleimani, he has been shown 

a number of times in photographs attending the funerals of some of those killed in Syria or consoling 

their families.

Iran may also be using Syria as a testing ground for 

new technology. In September 2013, the Iranian military unveiled a range of new, domestically-produced 

unmanned aerial vehicles (UAVs), which were shown 

in reports on state television. First was the IRGC’s 

combat-capable Shahed 129. The next day, the regular ground forces displayed three models, including 

the Yasir, thought to be based on a U.S. drone which 

Iran said it had captured in December 2012. As early 

as November 2013, Syrian activists were posting videos to YouTube which appeared to show a Yasir being 

flown over Damascus.48 And in December, the Al-Qaida-affiliated Al-Nusrah Front provided Al-Jazeera TV

with video footage of a Yasir it claimed to have shot 

down over Aleppo.49
25

Outlook: Prospects for Nuclear Talks.

Despite a visit to Iran by Director-general of the 

International Atomic Energy Agency (IAEA) Yukiya 

Amano in August 2014 being described by the Iranian Foreign Ministry as “constructive,” it is not clear 

whether Iran and the West will be able to resolve the 

standoff between the two sides over Tehran’s nuclear 

program.50 While there exists a degree of optimism in 

Rouhani’s moderate administration and the reformist media, most of the Iranian authorities, including 

Supreme Leader Khamenei, and the majority of the 

country’s prominent media outlets, have been highlighting “serious differences” that cast a shadow over 

the prospects for a comprehensive agreement. Khamenei has repeatedly gone on record to declare his pessimism about the outcome of the negotiations, while 

maintaining his support for the negotiating team led 

by Zarif. Media outlets have echoed Khamenei, and 

broad domestic support for a settlement is far from 

guaranteed. 

The Geneva deal raised hopes of the possibility of 

a comprehensive agreement, but the more detailed 

negotiations proved more challenging, with the two 

sides failing to reach an accord by the July 20 deadline despite holding six rounds of marathon talks. As 

a result, the deal was extended by a further 4 months, 

to November 24, 2014—by which date a compromise 

must be found. As part of the Geneva deal, Iran had 

agreed to provide detailed information to the IAEA 

about its nuclear program, with the agency then responding with questions. Although Iran says it has 

answered all the questions transparently, some highranking officials have expressed frustration about 

some of the agency’s new requests. 
26

Following a meeting with Yukiya Amano in Tehran on August 17, 2014, Ali Akbar Salehi, the director 

of the Atomic Energy Organization of Iran, said that 

Iran had voiced its concern about the issue of exploding-bridgewire detonators (EBW), a crucial component for a nuclear weapons program. “There used to 

be no more than two or three questions about EBW, 

but they suddenly rose to 60 questions and we complained about this,” Salehi said.51 Reza Najafi, Iran’s 

permanent representative at the IAEA, echoed Salehi’s remarks, criticizing the IAEA for making “some 

illogical demands.”52

Opponents of the agreement took the opportunity 

to voice pessimism over the negotiations. According 

to conservative daily Hemayat: 

With the arrival of Yukiya Amano in Tehran, there is 

a serious question as to whether a new nuclear agreement with the agency is on the way. . . . Iran has successfully come to trust the IAEA, and now it is the 

IAEA’s turn to adopt measures to create trust towards 

Iran. This is because creating trust is a two-sided 

game. If it cannot convince Iran to have cooperation, it 

should not expect more cooperation from Iran.53

Previously, in May 2014, influential hardline daily 

Keyhan had called it “indubitable” that the negotiations would “never have the desired conclusion” for 

the Islamic Republic. 

Iran has also accused Western powers of making 

“excessive demands,” which it says have made the 

negotiations more complex. Iran is particularly concerned about any questions with regard to its defense 

and missile capabilities, defining such issues as its “red 

lines” in the talks. “Negotiations on lifting the sanctions have led to no specific results,” Khamenei said 

at a meeting with Iranian ambassadors and diplomats 
27

on August 13, 2014. Two days later, Iranian state TV 

aired a 20-minute report about the prospects for the 

talks, claiming that the two sides had failed to meet 

the July deadline due to these “excessive demands” 

by the West, specifically the United States: 

As stated so many times by our officials, resolving 

Iran’s nuclear program is not a complex issue, as long 

as the U.S. recognizes Iran’s rights and, with its excessive demands, does not push the negotiations towards 

failure once again.

Finally, on August 18, Zarif said that Iran would 

not agree to a deal unless the P5+1 lifted all the sanctions on Tehran, something U.S. officials strongly oppose.54 Defiant messages also came from Majid TakhtRavanchi, a deputy foreign minister and a member of 

the negotiating team, who called on Western powers 

to drop “illusions”: 

We have done all we could to resolve the nuclear 

issue, and this is clear to the people of Iran and the 

public opinion in the world, but we are not willing to 

reach an agreement at any cost. Our flexibility has limits and we will negotiate based on the framework that 

has been agreed.55

Despite the remaining differences, Iran and the P5+1 

were scheduled to start a new round of talks on the 

sidelines of the UN General Assembly session in September 2014. 

Prospects for Agreement. . . . 

Any comprehensive agreement by November 2014 

would require significant concessions by both sides. 

At the time of this writing, neither side is showing 
28

willingness to reconsider its stance. Complete suspension of enrichment activities would be a politically 

unviable move for Iran. This is because of the amount 

of time and funds spent on the nuclear program to 

date, and, more importantly, the heavy price paid by 

the Iranian people for the program: enduring severe 

sanctions, negative economic growth for 2 consecutive years and an unprecedented surge in inflation. 

Even a significant scaling back of enrichment plans 

would draw intense criticism not only from officials 

and commentators, but also from ordinary people. 

Although independent poll information to gauge the 

views of the public on matters concerning national security does not exist in Iran, anecdotal evidence and 

reporting suggest that the majority of Iranians, including many on the reformist camp, are strongly in favor 

of the nuclear program. Any major concession by the 

government would leave it in a fragile and shaky position, and the subject of outrage. 

The transparency demanded by the international 

community is in some respects problematic. Iran has 

repeatedly said that it is willing to provide more transparency, but is deeply concerned about increasing its 

vulnerability to possible military action by Israel or 

the United States by giving away too many details of 

its nuclear facilities. Besides the dubious prospect of a 

comprehensive deal, another possible outcome could 

be a further extension of talks. But this would risk favoring critics of Rouhani, who have consistently argued that the government is wasting time and money 

on something which could never result in a desirable 

outcome for the country. Some influential MPs have 

warned that failure in talks would lead to Iran expanding its nuclear activities, and putting together a 

plan for enriching uranium to 60 percent. That could 
29

have grave consequences for both Iran and the West, 

as it might push Israel further toward air strikes on 

the nuclear facilities.56 At the time of this writing, 

it appeared that both sides were preparing for the 

probable consequences of a no-deal scenario, despite 

efforts to keep a positive tone about the prospects 

for agreement. 

. . . and Remaining Differences.

Major differences between the two sides were exposed during the more detailed negotiations which 

followed the Joint Plan of Action. The level and volume of Iran’s enrichment program, the future of its 

heavy water reactor in Arak, its research and development program, and finally the lifting of sanctions 

were key areas of disagreement.

The number of Iran’s centrifuges is a major stumbling block in the talks. The West wishes Iran to reduce 

its stock of centrifuges to numbers in the thousands, 

while Iran demands numbers in the tens of thousands. 

At the time of this writing, Iran had more than 19,000 

installed enrichment centrifuges at its nuclear facilities, while continuing to maintain that it has the right 

to enrich uranium for peaceful purposes and to deny 

that the intention is to develop a nuclear weapon. 

The major powers are also opposed to the installation of a new generation of centrifuges at Iran’s underground Natanz and Fordo enrichment plants. Iran, 

however, argues that it has the right to pursue nuclear 

research and development. 

Iran’s suspected weapons research activities pose 

another challenge. Iran has offered to implement the 

Additional Protocol to the Nuclear Non-Proliferation 

Treaty (NPT) if sanctions against it are lifted. The 
30

Additional Protocol requires IAEA member states 

to provide an expanded declaration of their nuclear 

activities and grant the watchdog more access to 

their nuclear sites. Meanwhile, the West is already 

requesting stricter international inspection and is not 

satisfied with progress after Iranian agreement to 

cooperate with the IAEA. 

Another obstacle is Iran’s Arak heavy-water research reactor. The P5+1 is concerned that the project, once operational, could produce plutonium. Iran 

maintains that Arak produces radio isotopes purely 

for civilian purposes such as agriculture and medicine. 

Some Iranian officials have said they are already trying to redesign the reactor to cut its potential output 

and alleviate international concerns. In return, Iran 

is demanding the swift lifting of sanctions imposed 

on the country over the past 8 years. The additional 

sanctions on Iranian oil exports and banks imposed 

by the United States and the EU since 2012 have been 

particularly damaging to the Iranian economy. However, coming up with a comprehensive plan to lift all 

sanctions will be a major challenge for the West, especially given the ability of the U.S. Congress to block 

their removal. The United States in particular faces a 

major test in working out how to appease Israel in the 

event of any outcome that could help Tehran maintain 

its nuclear enrichment activities. For these reasons 

among others, pessimists in Iran are concerned that it 

may take years, even decades, for the sanctions to be 

lifted in their entirety. 

What Would a Comprehensive Deal Mean?

A comprehensive agreement over Iran’s nuclear 

program could draw to a close a regional challenge 

that has exercised the United States and the West 
31

over the past 2 decades. A final deal could help both 

Iran and the West to normalize ties and cooperate on 

various regional issues. This could include working 

together on some of the adverse developments rapidly unfolding in the Middle East, including but not 

limited to the emergence of the Islamic State in Iraq. 

But an agreement which allowed Iran to continue 

any form of nuclear development would be unsatisfactory for the Middle East’s only nuclear power, 

Israel, which is demanding a total dismantling of 

Iran’s nuclear program. Some Arab states, including 

Saudi Arabia, are also deeply concerned about any 

Iranian nuclear activity. A final agreement would be 

a significant boost for Rouhani’s attempts to tackle 

serious economic problems. The lifting of sanctions 

that would follow would allow Iran to rebuild its seriously damaged economy, which in turn would favor 

Rouhani’s own popularity. 

A nuclear deal might not bring about radical social 

or political change in Iran, but it could at least pave 

the way for a beginning of reform in domestic politics. 

Hardliners, as major opponents of Rouhani’s administration and the nuclear deal, could potentially be 

further sidelined, and replaced by Rouhani’s camp of 

reformists and moderate conservatives. Furthermore, 

since Ayatollah Khamenei has hedged his bets over the 

outcome of the talks, any possible agreement would 

inevitably be portrayed as a success for him. Despite 

strong criticism by ultra-conservatives, Iran’s negotiating team has so far enjoyed Khamenei’s support. But 

it is not clear how long this support will last. Khamenei disapproved of the detente policy pursued during 

the 1997-2005 presidency of the reformist Mohammad 

Khatami, arguing that it only “emboldened” the West, 

particularly over the nuclear dispute. Hardliners are 

now already leveling the same charge at Rouhani.
32

Risks of Failure.

Concern over the patience of conservative elements running out may already have been at the front 

of Rouhani’s mind when he warned in September 

2013 that the opportunity to reach an agreement over 

Iran’s nuclear program is not “unlimited.”57 A total 

failure in the nuclear negotiations would have serious 

implications for all parties. Both sides in the talks have 

already announced what could happen if the talks are 

unsuccessful. “International sanctions will tighten and 

Iran’s isolation will deepen,” warned U.S. Secretary of 

State John Kerry in a Washington Post op-ed on June 

30, 2014.58 Senior Iranian diplomats, such as Deputy 

Foreign Minister Abbas Araqchi, warned in return 

that if the talks fail, Iran would resume production of 

20 percent-enriched uranium, which was suspended 

as part of the interim deal.59

Failure would also pose an immediate threat to 

Rouhani’s administration at home, and thus to the 

active engagement with the region and the world by 

Iran that has been Rouhani’s policy since he took office in August 2013. The end of this incipient detente 

could lead to a return to the confrontational style of 

Rouhani’s predecessor, Mahmud Ahmadinejad. 

Rouhani has been banking on a deal as a tool which 

could transform the economy, allowing in foreign investors and lifting sanctions on Iranian banks. Failure 

in the talks would thus not only be a foreign policy 

failure and a blow to his moderate/reformist agenda, 

but also a severe setback for Iran’s economy regardless of who is in power. 

But ultra-conservative critics have already attacked 

Rouhani for linking the country’s economic issues to 

the removal of sanctions. Instead of trying to lift the 
33

sanctions, hardliners have called for implementation 

of the “Resistance Economy.”60 The term denotes measures outlined by the Supreme Leader aimed at modifying the economy to reduce its vulnerability to sanctions. Once again, in the event of failure, Rouhani’s 

position would be undermined and the advocates of 

the Resistance Economy would be reinforced. 

In effect, to the extent that Rouhani’s supporters 

and the Iranian public as a whole are putting their 

trust in Rouhani to deliver a deal with the West and 

thus resolve Iran’s economic crisis, there is a realistic prospect of a continued trajectory toward reform 

and engagement. Conversely, that trust will not 

last indefinitely; a failure by Rouhani, and consequent continued economic trauma, could lead Iran 

down a regressive and potentially unpredictable and 

dangerous path. 

Outlook and Policy Implications. 

The United States and Iran do have common security interests, especially at the present time. The fight 

against terrorism, stability in Afghanistan, and peace 

in Iraq are all prime Iranian concerns. But for the time 

being, the nuclear problem appears once again to provide a block to effective engagement on shared concerns as well as to progress in all other foreign policy 

issues. At present, therefore, all hinges on the progress 

or lack of it of nuclear talks. 

In the Iranian domestic debate, the nuclear program is an intensely politicized issue. It feeds off antagonism between Iran and the United States, which 

in turn exacerbates the political importance of nuclear 

development still further. If either one of these two factors were removed, the vicious cycle would collapse, 
34

and the prospect of enhanced cooperation between 

the United States and Iran for the sake of regional security would open. But this would require a strategic 

shift on both sides. 

Given U.S. demands that Iran reduce its capacity 

to enrich uranium—and keep it reduced for a period 

of decades—the concessions required on either side to 

reach an agreement would be difficult and painful, and 

at the time of writing, neither side appeared willing to 

rise to the challenge. Indeed, both sides are prevented 

by domestic circumstances from reaching agreement. 

Iran needs to present any agreement as a victory to its 

domestic audience. There cannot be any appearance 

of significant concessions. The United States, too, cannot appear to back down not only because of its strategic position, or the effect on relations with key allies 

in the region, but also because of Israeli influence on 

U.S. foreign policy and the requirement for a deal to 

pass through Congress, famously described as “535 

U.S. Secretaries of State, each with their own views.” 

Recent developments appear to favor both sides 

equally. The dramatically improved domestic U.S. oil 

production makes it easier to place sanctions on Iranian oil exports with a much reduced risk of intolerable 

price increases as a result. Conversely, after the easing 

of sanctions, Iran believes its reinvigorated economy 

to be stronger and more resilient to any renewed sanctions that might be imposed in the future. At the same 

time, there is a belief that the simultaneous crises of 

Ukraine and the Islamic State have weakened the 

United States. 

Arguing that the real issue is between Washington 

and Tehran, Dr Gary Samore, former White House 

Coordinator for Arms Control and Weapons of Mass 

Destruction, points to the bilateral talks as a “more 
35

sensible process for negotiation” than the P5+1, which 

he says holds “ceremonial sessions” which are too 

cumbersome to reach real decisions.61 In any case, the 

Ukraine crisis has undermined the P5+1 negotiation 

format; Iran can proceed with much more confidence, 

since if talks collapse, the United States and Europe 

would not be able to reach agreement within that 

framework on reconstructing sanctions. 

Domestic support for Rouhani will continue to 

be fragile. Influential critics disapprove both of his 

nuclear and foreign policy ambitions, but also of 

his attempts to ease social and political conditions 

at home.62 Consideration of concessions to achieve 

nuclear agreement should include awareness of the 

potential adverse consequences of failure, including 

the potential for a more adversarial and unpredictable 

Iran as detailed above.

Supporting greater engagement between Iran and 

its neighboring Arab Gulf monarchies would be advantageous to the U.S. involvement in the region. The 

implications of an Iran-West detente are profound 

for the security strategies of the GCC states, a group 

of key U.S. allies deeply concerned about a potential 

threat from Iran. At the same time, it is essential to 

bear in mind that U.S. behavior toward Iran is watched 

very closely in Arab Gulf capitals, and perceived missteps—or compromises over Gulf security—would be 

likely to have immediate adverse consequences for 

U.S. relations in the region.

Iranian support for efforts against the Islamic State 

would undoubtedly boost U.S. efforts to subdue this 

threat. But temporary unity against a common enemy 

provides a fragile basis for a lasting relationship. Either side would view an alliance against the Islamic 

State with ambiguity, and all sides would retain their 
36

own motivations for independent action, leading to 

an alignment fraught with suspicion.63 A historical 

parallel is the Soviet Union finding, against its will, 

common cause with the Western Allies during World 

War II. The extent to which the Union of Soviet Socialist Republics was pursuing its own agenda became clear immediately after the common enemy was 

defeated, leading directly to an era of even greater 

confrontation.

ENDNOTES

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2. “Obama says Syria Deal Could Offer Lesson for Iran Talks,” 

Reuters, September 15, 2014, available from www.reuters.com/

article/2013/09/15/us-syria-crisis-usa-idUSBRE98D09C20130915.

3. “Rouhani: Time Not Right for Another Phone Call with 

Obama,” The Times of Israel, September 27, 2014, available from 

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4. “Rouhani Becomes Iran’s New President,” Press TV, June 

15, 2013, available from www.presstv.ir/detail/2013/06/15/309169/

rohani-becomes-irans-new-president/, accessed on August 15, 2014.

5. “Iran Vote: Rouhani Vows Transparency on Nuclear Issue,” 

BBC News website, June 17, 2013, available from www.bbc.co.uk/

news/world-middle-east-22940220, accessed on August 15, 2014.

6. “Hassan Rouhani Sworn in as President of Iran, Urging 

Moderation and Respect,” The Guardian website, August 4, 2013, 

available from www.theguardian.com/world/2013/aug/04/hassanrouhani-sworn-in-president-iran, accessed on August 17, 2014.
37

7. “Rouhani Stresses Regionalism in Iranian Foreign Policy,” 

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39

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40

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41

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U.S. ARMY WAR COLLEGE

Major General William E. Rapp

Commandant

*****

STRATEGIC STUDIES INSTITUTE

and

U.S. ARMY WAR COLLEGE PRESS

Director

Professor Douglas C. Lovelace, Jr.

Director of Research

Dr. Steven K. Metz

Author

Mr. Keir Giles

Editor for Production

Dr. James G. Pierce

Publications Assistant

Ms. Rita A. Rummel

*****

Composition

Mrs. Jennifer E. Nevil