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CWA # 8, 18 May 2018

Global Politics
Why Trump’s Iran exit is a big mistake?

  Samreen Wani

The weakening of the EU resolve will inevitably erase any chances of Iran continuing with the deal. Tehran meanwhile, has already expressed its unwillingness to negotiate an alternative deal.

Trump has withdrawn the United States from the Iran nuclear deal. What next? How long will the EU nations be able to hold out against the Americans? What options do the Iranians have? How long till businesses shut down? Should the North Koreans be nervous about their fate?

Will the EU crumble?

Statements from the European Union have been very different from those of the White House. European leaders have expressed their loyalty to the deal and have assured Tehran of their compliance with the terms of the 2015 agreement. What remains to be seen is for how long will Europe be able to oppose Washington.

Will the EU defy Washington and impose legislative measures of the kind it did 20 years ago against sanctions by the Clinton administration? Or will the EU buckle under pressure from its strongest ally?

The absence of any clause obliging the other members (apart from the US) to protect the N-deal place it in a very perilous position. Recent disagreements between the EU and the United States on numerous issues, for example, the shift of the US embassy to Jerusalem, US exit from COP21, point towards a certain estrangement between the once all weather friends.

The weakening of the EU resolve will inevitably erase any chances of Iran continuing with the deal. Tehran meanwhile, has already expressed its unwillingness to negotiate an alternative deal.

What is on the Iranian mind?

There are some concerns about Iranian patience with the deal and its aspirations to enhance its nuclear stockpile. But with all eyes on Iran, clandestine development of a nuclear arsenal will be a near-impossible task. Being a signatory to the NPT, Iranian nuclear establishments are invariably under the IAEA inspection regime.

Tehran is quite aware that its acquisition of a nuclear weapon will spark a nuclear arms race in the region much to its own detriment. The onus hence is on Iran to avert a nuclear arms race in the Middle East by refraining from restarting its nuclear programme.

Domestically for Iran, the mood has shifted. Iranian nationalism prides itself on its resilience in the face of punitive sanctions, political upheavals, regional intrigue and war.

Consequently, the Iranian foreign policy feeds on this sense of self-worth. Trump’s decision has directly fed into the anti- America bellicose of the hardliners who were always sceptical of the Rouhani led reformist government’s optimism in the JCPOA.

In such circumstances, expecting Iran to come to the negotiating table to draft another deal along the lines suggested by Trump is a folly.

Businesses take the brunt?

The announcement has already had some economic consequences. The Rial plunged against the US dollar while the oil prices rose by more than three percent- the highest since 2014.

Meanwhile, stock prices of US weapon manufacturers shot up. Reimposition of sanctions by Trump endangers about 25 billion USD of EU trade with Iran.

EU has in response threatened to pull United States to the WTO if its businesses are affected by US sanctions. Sanctions on Iranian businesses and their trading partners put the world oil trade under immense pressure. China is Iran’s largest oil partner, and sanctions would have an adverse effect on Beijing’s oil imports.

The French energy firm, Total is working on a deal with the world’s largest gas field and would find punitive sanctions quite disruptive for business.

India has a huge stake in ensuring the longevity of the Iranian businesses as the profits from investments in Chabahar will be pushed back by several years if the sanctions were to come in place.

The Korean Dilemma

For the North Korean regime, the fate of the Iran deal is a case study in American commitment to multilateral agreements. Framing the contours of the Korean deal against the backdrop of a precarious Iran deal will be a litmus test of the American resolve to secure its interests and that of its allies abroad.

Unlike the Iranians, the Koreans have agreed to engage in a bilateral discussion concerning its nuclear future. This makes the two deals fundamentally different from one another.

The North Koreans come to the table already equipped with a nuclear weapons stockpile thus increasing the leverage they bring to the negotiations.

Trump’s withdrawal exposes his lack of regard for the international rules of engagement- a fact the Koreans might have found hard to miss.

Samreen Wani is currently pursuing Masters in International Studies in Stella Maris College, Chennai. This article was first published in Rising Kashmir on May 14, 2018

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