Iran Eyes the China Card

China’s presence in Iran and the Middle East might be a potential threat for the United States given its current regional policies — but it is an opportunity for emerging nations like Iran.

For rising nations, like Iran, that tend to follow their own independent route to advancement, the best situation is a multi-polar world in which potential global powers like China can offer investments and technology to protect rising nations from the U.S. and Europe’s pressing strength. From an Iranian perspective, therefore, China’s increased presence in Iran, the region, and even global economy is not at all a threat; rather, it is an opportunity to outweigh other powers.

In recent years, China has played a quiet, carefully planned economic game in Iran, which has advanced its political-strategic interests here and helped advance its presence in the Persian Gulf countries, which are the region’s closest allies of the West. Undoubtedly, China’s presence in the region satisfies those countries.

Iran’s “Look East” policy has roots in its cultural-societal, geographic and political-economic connections with Asia. For many years, the Iranian perception of international relations has compelled the country to balance its political, economic and cultural affinities between West and East. In recent years, China’s fast-growing economy and its extensive demand for Iran’s energy sources have reinforced Iran’s inclination to advance further economic and political-strategic cooperation with China. Today, one of Iran’s strategic goals is to bind its energy-rich resources to the South-Asia region via the Iran-Pakistan-India Pipeline (IPI), extending the pipeline to China’s markets in future years.

Chinese presence in Iran mainly started in the 1980s, during the Iran-Iraq war, when Western countries imposed the first round of sanctions on Iran, turning the country toward China (and Russia). Although the relations were first limited to military purchases by Iran, this soon extended to vast economic exchanges. Iran’s traditional economy is controlled by the Bazaar, a source of both economic and political power which contributes significantly to regulation of Iran’s foreign trade. State-oriented economies, cultural similarities, cheap Chinese commodities, and easy economic and banking systems and exchanges were among the factors that gradually enhanced the two sides’ economic relations. This expansion of the relationship soon led to China’s further involvement with Iran’s infrastructure economic activities, such as roads, railways and urban construction as well as oil and gas infrastructure. Those plans require a long-term Chinese presence in the country. Over the last decade, China’s involvement has slowly won Iran’s confidence both in economic and political-strategic activities. As a result, today the governing elites of Iran believe that China is a reliable partner that can and will offer everything that Iran demands in crucial times.

It is expected that today’s $14 billion Iran-China economic exchanges will reach to $20 billion in the coming year. China can also meet some of Iran’s military demands, such as rocket and satellite technology. Politically, there is some reluctance inside Iran about Chinese political support of Iran on the UN Security Council, yet given the fact that playing with the Iran card will give China some bargaining power in dealing with the United States on global strategic issues, it gives a great deal to Iran in benefiting from the China card as well.

Lastly, some pundits argue that one of the top strategic goals for the United States in starting the Iraq war was to dominate the Middle East region’s energy resources and control China, its potential 21st-century global rival. After Iraq, the Bush administration wanted to head toward Iran, which holds the world’s second largest oil and natural gas reserves. But imposing pressure, sanctions, or isolation on Iran will only push the country further toward China. That’s another failure for the Bush administration’s foreign policy, which will lose further strategic influence in the Middle East.

Kayhan Barzegar is a Research Fellow at the Belfer Center, Harvard university's Kennedy School of Government. He teaches international relations and Iran's foreign policy in Tehran.