Iran: Recalibration and Impact in the 21st Century

Introduction:

In 1979, Iran grabbed headlines the world over for the Islamic Revolution and the ouster of Shah Reza Pahlavi, the last and controversial monarch. It was accompanied by a wave of anti-West sentiment, ultra-conservative and fervent anti-America demonstrations. (Afary, 2019) Over the next few years, as the feeling consolidated in the now-Islamic Republic of Iran, the nation, once the pride of the Asian world, was now globally shunned. In 2022, the nation grabbed headlines due to the custodial death of 22-year-old Mahsa Amini, who was arrested and tortured by the Iranian morality police, the ‘Gasht-e-Ershad’ for improperly donning the hijab. (Reuters, 2024)

During this 40-year period, there have been many such developments within the nation that have led to serious policy reorientations and strategic calculation on part of world powers. Given the growing Iranian relevance in West Asia, there has been a juxtaposition of sanctions and rapprochements, of sabre-rattling and cooperative diplomacy, of religion and politics in an already-volatile region that has captured the eyeballs of the global community at large. While such events were once limited to policy pundits and analysts, it is not so in the age of connectivity and information. This paper shall study some of the post-2000s events in and concerning Iran, that hint at its ever-increasing prominence- in a region with contending powers and in a world with ever-important stakes in the Middle East.

Iran in the 21st century

Iran in the 21st century is a country no one can overlook, on any parameters. Geographically, it is one of the largest Islamic countries with a population of 82,8 million, overlooking the economically significant Persian Gulf. Its 463 billion USD economy is sustained primarily by hydrocarbon exports, contributing to most of its foreign exchange. It is one of the largest militaries in the region- comprising the Islamic Republic Armed Forces and the Iranian Revolutionary Guard Corps. It is known for blanket suppression of dissent, civil rights restrictions (especially for women), and as a region prone to drought and other natural disasters.

Political organisations in Iran have been dominated by the clergy. While reform was promised by most leaders, they have voluntarily adopted a hardliner stance that echoes Ayatollah Khomeini’s policies of the 1980s. There were attempts to breach the East-West barrier against Iran by leaders such as President Mahmoud Ahmedinejad (2005-2013), although they were met with vocal opposition given Iran’s non-compromising stance to Western demands. The botched nuclear deal, and militant opposition to the state of Israel in West Asia are severe fault lines between Iran and a healthy relationship with the West.

‘Wiping Israel off the map’: Developments post October 07, 2023

Iran has never shied away from attempting to assert the illegitimacy of Israel as a sovereign state, calling it a ‘Zionist occupational force’. It is a leading proponent Arab-Islamic states calling for wiping it off the map, by Ahmedinejad and echoed by ex-Deputy Leader of the Revolutionary Guard, Hossein Salami (MacAskill & McGreal, 2005). Iran has used this as the primary justification for its militarization and nuclear weaponization attempts in the past decades, calling for total annihilation in case of any conflict initiated by Israel. (Times of Israel, 2019).

Another aspect of Iran’s West Asian policy is the open support to radical and terrorist groups in the region, such as the Hezbollah, the Quds force and the Hamas outfit active in the Gaza Strip. It remains the largest provider of training, funds, ideological support and foreign legitimacy, as well as sophisticated drones and other weaponry- most of which were seen employed in the October 7 attacks. They have also found ideologically similar allies in the Houthi (Ansar Allah) movement of Yemen, who mounted large-scale drone and missile attacks on oil and commercial shipping in the Red Sea, they have led to over 60 attacks on civil and military vessels, with one hijacked (the MV Ruen) and two sunk, leading to 16 deaths and at least 42 injuries. (Gambrell, 2024)

Iranian military aid to the Houthis has been flagged during several searches and seizures by international forces, with various caches of missiles,drones and explosives seized. Components of Iranian Shahed-136 kamikaze drones (responsible for the attack on MV Chem Pluto), various classes of surface-to-surface missiles, guidance and propellant components, along with small and medium arms, have been seized in particular, according to a report by the US Defence Intelligence Agency. (Gupta, 2023; DIA, 2024). Iran has thus acted as a major disruptor of the ‘freedom of Navigation’ in the region, almost always through its proxy actors. As a result, it wields considerable influence over West Asian politics, effectively channelling anti-America and anti-Israel sentiment to unite Shia Muslims in the region, in an attempt to destabilise the Western and “Westernised Sunni-Muslim” stakeholders’ hegemony in the region- characterised by an oil-based economy and large-scale military deployments.

The largest impact, however, is the increasing vulnerability of the global trade passing through the Suez Canal, which amounts to almost 1 trillion USD per annum. (Ministry of Foreign Affairs and Trade, 2021) Daily disruptions impact global supplies of oil, gas, mineral ores and other critical food and energy products, causing severe economic distress in European, African and American markets, while affecting the export-based economies of India, China and the rest of Asia. The increasing threat of attacks on vessels may eventually lead to many companies abandoning the route, choosing to circumnavigate the Cape of Good Hope despite towering costs. (Lloyd's List, 2024) It has also led to prominent navies deploying their naval assets in the region to protect commercial shipping lines from piracy and missile attacks (under the US-led Operation Prosperity Guardian, or independently as in the case of India), leading to unnecessary expenditure and squandering of assets otherwise useful in coastal and blue-water defence.

Iran and its proxies today hold the power to disrupt global trade stability, reminiscent of the events during the nationalisation of the Suez Canal. This action perceived as “Iranian highhandedness” has been vociferously objected to by the West. However, it is important to note that given the status quo, Iran remains the most significant player in the Middle East with the power to influence the trade, international presence and situational stability in the region- eclipsing the geographically-distant Western and Eastern powers, and overpowering in sheer magnitude, most militaries and economies of West Asia.

Double trouble: increasing military capabilities

In recent years, the Iranian Revolutionary Guard Corps (URGC) has steadily gained prominence as the primary interdiction force in the Persian Gulf, it eclipses the Iranian Armed Force in personnel strength, funding, equipment (it controls the ballistic missile arsenal) and political access. This internal prioritisation, as well as the religious zealotry that supports its operations, it has risen as the prominent financier of extremist and terrorist organisations in the region. (CFR, 2024). The IRGC Navy’s use of fast attack crafts and hit-and-run tactics, coupled with an arsenal of mines and cruise missiles is conceptualised to overwhelm enemy defences with an element of shock.

This unconventional warfare is complemented by the regular “green-water” Iranian Navy, consisting of frigates and submarines, which participate in area denial operations (to US-led coalition forces in the region). (Connell, 2013) Iran therefore remains an unwavering force in the region, whose political compulsions would not allow a thawing of relations with its enemies. It continues to be a hostile agency, and the IRGC a quasi-militia, who often resort to provocative measures to protect Iranian interests. Therefore, having Iran on one’s side eases one’s access to the Persian Gulf, for it is only prudency to ally with the strongest force in a region to ensure one’s survival in a region with already volatile diplomatic interests and contested seas.

Amidst Western sanctions and a subsequent ban on spare parts for Iran’s primarily US-origin arsenal, Iran has since developed a flourishing indigenous defence industry, reverse engineering weapons and developing a new form of cheap and effective warfare- one using kamikaze weapons. Shahed-136 drones (along with the Mohajer reconnaissance UAVs) have already taken to the skies in Ukraine and over the Red Sea, their long range and large payload capacity proving effective to target valuable installations at a low cost. Iran has also constructed many naval vessels at home, hinting at a well-funded defence program.

Iran has since focused on brute force attacks, and the power of mass-production at cheap rates, as the plan of action to expend expensive Western-made weapons in a war of attrition- especially considering the Israeli Iron Dome aerial defence system (costing 2-3 million USD per shot, against a USD 20,000 drone). (Fallon, 2024)

The Maratha navy was established and extolled on the lines of the adage attributed to Chhatrapati Shivaji Maharaj I : “jalameva yasya, balameva tasya” (He who controls the seas is all-powerful). (Kmaneck, 2023) In accordance with the ‘flagship’ of modern navies, which exports a nation’s prowess to distant shores and asserts its sovereignty with local waters, one looks at the number and nature of aircraft carriers in service with a country. The Iranian Navy recently launched the Shahid Bagheri (with plans to develop the Shahid Mahdavi as a sister ship), a drone carrier converted from a merchant ship. It features a ski jump, an angled flight deck and is reported by Iranian state media as a “forward base ship”. (Military Watch Magazine, 2024)

There are concerns for the power projection and self-defence capabilities of the ships, given the lack of anti-air armaments and the inability to operate manned aircraft. However, its role as a mothership for large-scale drone attacks, which when coupled with Iranian stealth drones could change the field of war in the region. It would significantly extend the reach of the Iranian navy, diversifying its targets beyond the Persian Gulf. This could bring it into direct confrontation with other navies and task forces in the region. Given Iranian affiliations with proxy actors, there is also credible fear that the carriers could initiate operations in support of the flow of narcotics and weapons to various terror groups waging war against Saudi, Israeli or American interests. The similarity of weapons between the Iranian and rebel forces would also offer it a sense of plausible deniability, if stealth drones were used to attack opposing military installations as provocation to justify an all-out war.

Atoms for “Peace”: Studying the Iranian nuclear option

The Iranian nuclear programme began under the Shah, when the Tehran Research Reactor was instituted with US aid (it went critical in 1967). It was also a signatory to the Non-Proliferation Treaty since 1970. After the revolution, Iran restarted the programme in 1982, gradually scaling up uranium sourcing and enrichment. While it claimed that this step was to generate electricity and free up more fossil fuels for export, the world remained less than convinced. As the report quotes Jose Goldemberg, a country need not have a military objective while initiating a civilian nuclear energy programme. The plutonium produced as a byproduct of the nuclear fission reactor, is weapons-grade enough whether the political establishment of the day deemed it necessary or not. This possibility, or Iran running a nuclear weaponization programme while circumventing sanctions under the garb of a civilian project, has led to increased tensions between Iran and the West, which Iranian leadership has certainly not tempered. (Congressional Research Service, 2019)

The 2015 Joint Comprehensive Plan of Action (JCPOA), signed by Iran alongside Russia, China, Germany, France, the UK, US and the European Union, placed stringent restrictions on Iran’s nuclear ambitions. It limited Iran’s stockpile of uranium to 300 kilograms and placed all nuclear facilities under observation of the International Atomic Energy Agency (IAEA). Iran was to abandon construction of heavy-water reactors (HWRs), which had the capability to produce weapons-grade uranium and plutonium. In exchange, Iran would gain access to uranium markets to purchase fuel and would see a gradual termination of sanctions on the Iranian economy. (European Parliament, 2015) However, after the US unilaterally pulled itself out of the deal, while attempting to push a harsher treaty, Iran retaliated in 2019 by sanctioning unlimited Iranian enrichment. (Congressional Research Service, 2019)

A 2024 estimate of the IAEA has suspected a uranium stockpile of 5841.87 kg, with 142.1 kg at 60%enrichment being close to weapons-grade (at 90% concentration). Iran has also increased the number of gas centrifuges to concentrate the uranium-235 isotope. What was more concerning for the global community, however, was Iran’s decision to expel IAEA inspectors and to remove monitoring equipment installed in its nuclear sites. (Director General, IAEA, 2024) This was the final straw for generating credible fears of Iran becoming a nuclear state in the near future. This would definitely grant Iran increased bargaining power in the politically fraught Middle East, upending the power balance of two nuclear powers- the USA (officially) and Israel (unofficially). Iran also possesses the land, sea and air delivery mechanisms for nuclear warheads via its vast missile arsenal.

This fear is certainly exacerbated by the threat of a nuclear war, given Iranian statements in favour of unleashing a nuclear strike on Israel. Israeli sabotage of Iranian plants, the ongoing Arab-Zionist conflict in the region, and the West-East rivalry, the perception of Israel as a colonial imposition in West Asia, has all contributed to a conflation of clarity. Iran’s active pursuit of the nuclear option, and its non-hesitation to utilise it, has just added fuel to the fire.

Axis Powers 3.0: analysing the Russia-China-Iran nexus

After the 2022 Russian invasion of Ukraine, there was an alliance brewing with two two major Asian powers- Iran and China. Iran was a natural ally for Russia, as both nations had been plagued by economic distress and diplomatic cold-shouldering in the wake of US-led sanctions. China became a close ally primarily due to its economic potential, as well as its anti-US political stance. What followed was massive exchanges of defence technology, support on international platforms and a bonhomie that threatened the rise of a new power axis. (Bergmann et al., 2024)

Iranian reconnaissance and kamikaze drones have been prominent in Russia’s advances against Ukraine, attacking military installations and troops in suicide missions. The Shahed and Mohajer drones have been utilised to augment infantry and artillery forces, with over 4600 being fired in Ukraine. (Kochis, 2024) Similarly, Chinese first-person-view (FPV) drones from the company DJI have been increasingly used in reconnaissance roles during the conflict, and also in a primitive anti-tank role with strapped-on charges. China has also supported Russia by providing artillery shells and satellite imagery. There are also unconfirmed reports of Iran sending hundreds of ballistic and cruise missiles to Russia, as well as precision cutting tools for local manufacturing of critical components. (Robertson, 2024). The alliance, therefore, amalgamates each nation’s assets- the manufacturing power of Iran and China, the technological prowess of Russia and China, and the oil-powered economies of Russia and Iran- all fuelled by a hatred for the West, and particularly the USA. This has also been seen when the two states supported Iran’s nuclear program with technological assistance and international support.

Iran recently participated in Russian and Chinese naval wargames and live-fire exercises in the Strait of Hormuz, focusing on the “protection of maritime economic activity”. (Al-Jazeera, 2024) Iran has therefore risen as an important cog of the new power dynamics in the Asian hemisphere. Its engagement with Russian and Chinese navies, amidst talks of acquiring cutting-edge Su-35 fighters and ballistic missile technology from both, is something that threatens the fragile peace of West Asia, as well as for the broader Indo-Pacific. (Bergmann et al., 2024). This new nexus challenges the West in dangerous and provocative terms, with the wargames highlighting the bloc’s intent to exploit the volatility of the Suez Canal to pressurise the world into acquiescence in the event of a conflict. Should a conflict arise, there are credible fears of it escalating into a proxy war between Russia and the US, but with more disastrous consequences on the world, and with more nuclear states at play.

India and Iran: the strategy of the relationship

Although both India and Iran have been on the opposite sides of history in different blocs, there has been multi sectoral cooperation seeking the mutual interests of both parties. Over the past few decades, they have been developing a close relationship, most vividly via the joint development of the Chabahar port. This allows for expanding economic interests of both Indian and Iran, while also allowing for Iran to be a key replenishment depot for Indian Navy ships deployed in the region (also as a link in the ‘Necklace of Diamonds’ strategy). Iran also gained prominence in recent times as the link between the East and the West- challenging established monopoly of the Suez Canal.

The first, was the probability of the Belt-and-Road initiative (BRI), which extends to Iran under the China-Central Asia-West Asia Corridor. (Chang, 2024). The second, in which India is a crucial partner, is the International North-South Transport Corridor connecting India (and the Arabian Sea) with Russia, Central Asia and Europe (and the Caspian Sea), via Chabahar. (MEA, 2023) Iran’s geographic location, therefore, becomes central to India’s trade with Central Asia and Russia, becoming concerned with minerals such as coal, oil, and rare earth metals from the region. It is vital to the export-based economies of Central Asia, who otherwise remain landlocked and dependent on two powers- Russia and China.

This raises Iran’s importance as a partner in their national policy. Given that the US wishes to wean itself off rare earth metal exports from China, it requires access to Central Asian markets and trade corridors- with Iran being the most viable partner in this endeavour. Indian and global aid to Afghanistan has also been shipped via this corridor, giving the country a new lease of life. It is interesting to note, that the Corridor has notably opened up Asian and African markets to Russian oil and gas, there being no need to circumvent Europe or the Pacific. Therefore, Iran becomes the magnum opus of all major economies in Asia- making it critical to several economic and foreign policies- of allies, enemies, and everyone in between.

Masoud Pezeshkian: restoring balance to a fractured Iran

The recently concluded Presidential elections in Iran saw Masoud Pezeshkian, a cardiac surgeon and a Moderate come to power with 53.7 percent of the votes polled. He is a leader who has frequently questioned the autocracy of the Iranian government, as well its inflexible foreign policy and non-responsiveness to popular opinion. He is considered a beacon of political and social change in Iran, having criticised Mahsa Amini’s death and of late, appointed a woman to a ministerial post for the second time ever. In his inaugural address, Pezeshkian spoke of stimulating increased dialogue with the West and the Gulf countries among other avenues, gradually opening Iran up to international trade by reducing sanctions. He has also voiced support for the JCPOA nuclear deal of 2015, with his actions seeking a reconciliation between extremist and moderate elements of Iranian politics. (MP-IDSA, 2024).

There is, however, a pinch of salt in this global optimism, for he changed tact upon a successful election. He has not backed down from Iran's multilateral support to the Axis of Resistance against Israel, or from providing aid to Hamas and the Houthis. He has acknowledged the supremacy of the Ayatollah Khameini and the Shi’ite clergy, over him and the nation, which may be a hindrance to a truly reformist Iranian government. There is also a theocratic (under the Ayatollah) and public (from the Parliament) compulsion to stick to Tehran’s line of diplomacy over the decades, which may block genuine attempts from Pezeshkian to open Iran’s economy to new markets. (Firstpost, 2024) He has also reaffirmed the paramount nature of the Revolutionary Guard, given the US’s designation of it as a terrorist organisation.

Therefore, Masoud Pezeshkian has his work cut out for him- a tough battle of negotiation between the reformists and the hardliners. As a reformist leader, his opening up to the West shall determine oil flows from Iran, the gradual ebbing of sanctions, and the diversification of Iranian foreign policy from a strictly anti-West agenda to a more accommodating platform. It would also impact Iran’s nuclear stockpile, the JCPOA, and the probable de-escalation of tensions in the Gulf with increased dialogue with the Saudi-led faction. Continuing the hard-line would entail increased power to the Houthi and Hamas forces, a non-negotiating stance in all strategic aspects, and a race for militarization among competing, insecure states in the region. Greater volatility of the oil markets, increased trade costs across the globe (as more and more companies abandon the Suez Canal) and the threat of a prolonged conflict with participation of global powers looms upon us all.

Conclusion

Iran has had a profound impact on international affairs, since the might of the Aechmenid and successive Islamic dynasties. It was a key battleground during all Western struggles for power, extending up to the Second World War and the Cold War. Even today, we see the impact of Iran on all global dynamics- the USA-Russia-China tussle, the Indian success story, the Arab-Israel clashes, the prominence of violent non-state actors such as the Houthis, and the civilisational pride of a nation manifesting into strategic gatekeeping and diplomatic inflexibility. In the 21st century, it is now Iran itself who can decide the world order it wants to live in- one where it is shunned, or where it is engaged.

To do so, it will have to recalibrate its national interest and objectives, tamp down the conservative, anti-reform theological power structure, and be willing to negotiate for an increased standing on the global dais. There are hopes from Pezeshkian, but they seem idealistic given Iran's rigid ground reality. There are hopes from the West, but they still require a total capitulation of Iranian sovereignty to kickstart talks, there are hopes from the Global East, but they are overshadowed by a pro-resistance idea of the Middle East. Therefore, there is a requirement for sound and rational Iranian diplomacy, and an accommodating world order to de-escalate tensions that have a direct or indirect impact on the world.

Iran has the capability to become a worthy pole in the multipolar world order of the 21st century- as of now, it has dominated headlines for the wrong or incompatible reasons. As a military power with cultural diversity, economic prowess and a gifted geography to boot, it can benefit the world- and benefit from the trade-off. All that remains to be implemented is a political leadership with the pragmatism to learn from the past, not remain entrenched in it. In a setting that is conservative and closed to reform on a variety of levels, breaking those policy moulds will set the wheels turning for Iran’s rise in today’s day and age- where transactionalism, and not isolationism, is the talk of progress.

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By Yashodhan Deodhar

Yashodhan Deodhar is a third-year student of political science in St. Xavier’s College, Mumbai and an intern at the Forum for Integrated National Security. He takes keen interest in international relations, diplomacy, defence affairs and security studies. He has also written research articles and papers for intra-collegiate magazines, and research platforms.