Pakistan has claimed that international sanctions on Iran limited its ability to work on the project, but in spite of this, Iran is evidently pushing its neighbor to build its half of the pipeline even if doing so involves violation of sanctions. Iran is also arguably aiming to punish a lack of compliance or the creation of obstacles to its attempts at gaining greater control of regional oil.
India and Bargaining Power
Meanwhile, Iran is exerting economic pressures on Pakistan’s neighbor and rival, as well. The Wall Street Journal reports that Iran has significantly decreased the amount of Basmati rice it imports from India, leading to a sharp decline in India’s domestic prices for the commodity. Analysts suggest that this is likely an effort by Iran to secure lower prices while it has leverage to bargain with its trading partners.
That leverage has begun to grow particularly strong in light of the relief of sanctions under the interim nuclear deal. Because of it, Iran has less need than it previously had for barter-based trade in order to off-load its own oil. This is especially true because of the rising tide of foreign businesses re-entering the Iranian market.
Parag Khanna comments on this phenomenon in an editorial at CNN.com. He indicates that businesses are not waiting for the completion of a nuclear deal before moving into Iran, despite what national government might want. Khanna argues that that situation is inevitable, and that governments ought to accept the emergence of Iranian trade and use it as a source of their own leverage. The alternative, in Khanna’s mind, is that Iran’s friends and allies come to dominate the market, leaving the West with nothing that it can threaten to take away in the long run.
On the other hand, the reentrance of foreign businesses into Iran may not yet be inevitable. There are numerous indications that previous sanctions were effective at impairing the Iranian economy and keeping most foreign actors out. A change of policy and reinforcement of sanctions may yet have similar effectiveness.
The Brookings Institution reports that according to a doctor at ShahidBeheshti University, there were 120,000 illegal abortions in Iran during the year 2012. It is worth noting that these figures are from the same year that Iran ended its previous policy of providing free vasectomies to men who wanted to control family size. However, they also come from before Ayatollah Khamenei’s recent fatwa insisting that women immediately begin having very large families, regardless of their economic situations or personal desires. The government’s current maximum baby push is expected to result in an increase in illegal abortions as women are either deprived of all access to family planning resources or shamed for opting to raise a small family.
The Brookings Institution will be having a policy discussion on US-Iran rapprochement on Wednesday evening in Doha. It will discuss the prospects for diplomatic relations between the two countries, the extent to which the current situation is different from situations that have failed in the past, and whether rapprochement would be harmful or beneficial to the Middle East as a whole.
This event takes place just over two weeks before a gathering of Iranian expatriates on June 27 in Paris, which will provide a different perspective on many of the same issues, and will include remarks on policy by a number of legislators and dignitaries from North America, Europe, and the Middle East.