Australia/Israel & Jewish Affairs Council

New P5+1 talks on Iran's nuclear program

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Update from AIJAC


Dec. 8, 2010

Number 12/10 #03


As readers may be aware, earlier this week saw the renewal of talks in Geneva between Iran and the "P5 + 1", that is, the permanent members of the UN Security Council plus Germany, concerning Iran's continued nuclear defiance. This Update looks at the background and prospects of those talks, and includes some divergent views on strategies for handling the Iranian nuclear threat.

First up is Simon Henderson of the Washington Institute for Near East Policy, who focuses on the background and expectations related to the current round of talks. He reviews the particularly damning recent International Atomic Energy Agency findings on Iran and Teheran's longer history of nuclear defiance, and also looks at why the talks have resumed now. Henderson also discusses the dilemmas at the talks for the US given little expectation of a breakthrough and the Russian and Chinese reluctance to take serious action against Iran. For everything you need to know about these talks, CLICK HERE. Some early signs indicate that the Iranians appear to be less than interested in reaching a nuclear deal - refusing to shake US Secretary of State Clinton's hand at a gathering and then publicly rejecting any discussion of the key issue - their ongoing uranium enrichment. Meanwhile, Iran expert Meir Javedanfar attempts to explain why anyone is bothering with the Geneva talks, given that noone seriously expects any breakthroughs.

Next up are Yoel Guzansky and  Jonathan Schacter, analysts from Israel's Institute for National Security Studies at Tel Aviv University, who argue that economic sanctions are starting to seriously affect Iran, and this effect is likely to increase. They posit that the slashing of food and fuel subsidies that Teheran has been forced to undertake may actually worsen the future effects of sanctions, especially if they coincide with even more efforts targeting Iran's petroleum sector. They argue that the key to gaining Iranian nuclear flexibility is a range of actions, including a threat of force and sabotage efforts such as the Stuxnet computer virus, as well as tough sanctions. For their full argument, CLICK HERE. More on alleged positive results from the sanctions here. 

A contrasting view comes form Dr. Efraim Inbar, veteran Israeli strategic analyst who heads Bar Ilan University's Begin-Sadat Centre for Strategic Studies. Dr. Inbar argues that all such measures are too late, and that we are now at a stage where only Israeli or American military actions can halt a nuclear-armed Iran. He also makes a strong case for why allowing Iran to get nuclear capabilities would be a strategic disaster, with Iran dominating the petroleum producing Gulf region, destablising not only the Middle East but possibly South Asia and Turkey as well, massively increasing terrorism, and a highly dangerous regional nuclear arms race. For Inbar's complete opinion, CLICK HERE.

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Back to the Table: New P5+1 Talks with Iran

By Simon Henderson

PolicyWatch #1727
December 2, 2010

On December 6, representatives of the United States, Russia, China, Britain, France, and Germany will meet with Iranian delegates in Geneva for two days of renewed talks on Tehran's nuclear program. The aspiration of the P5+1 -- the permanent members of the UN Security Council plus Germany -- is to finally achieve progress toward a negotiated resolution of concerns over Iran's nuclear activities. Led by European Union foreign policy chief Catherine Ashton, the negotiations are expected to be tough, with neither side wanting to make concessions. In addition, the atmosphere of the meetings will likely be influenced by the recent WikiLeaks revelations of heightened Arab anxiety about Iran.

Background

In 2002, the international community learned that Iran was working on a centrifuge-based uranium enrichment facility at Natanz and a heavy-water facility (capable of producing plutonium) at Arak. Both projects have the potential to produce fuel for atomic weapons. Accordingly, the International Atomic Energy Agency (IAEA) -- which polices the Nuclear Nonproliferation Treaty, of which Iran is a signatory -- has been investigating ever since.

From the start, Tehran has maintained that its nuclear program is for peaceful purposes only. In the IAEA's view, however, the regime has yet to adequately explain its activities. In 2003, Germany, France, and Britain -- then dubbed the EU-3 and since expanded to the P5+1 -- began a diplomatic initiative to resolve the outstanding questions.

The last time Iran and the P5+1 sat together at the negotiating table was October 2009. During that session, also held in Geneva, Iranian officials reportedly agreed in principle to send much of its stock of low-enriched uranium (LEU) abroad. They had argued that Iran needs the LEU to fuel the small Tehran Research Reactor, with the goal of producing medical isotopes. But they also acknowledged that new fuel rods could only be made outside Iran. By agreeing to send most of its LEU abroad, the regime would obtain fuel rods it purportedly wanted while also reducing international concerns, which centered on potential Iranian conversion of LEU into highly enriched uranium (HEU) suitable for a weapon.

Back in Tehran, however, the government stalled on implementing the agreement, with repeated attempts to change its terms. In the meantime, Iran has produced more LEU, undermining the basis of the deal. Although Turkey and Brazil attempted to rebroker the arrangement in May 2010, their efforts failed because they did not take into account the extra stocks of LEU Iran had produced since 2009.

New IAEA Report

In its latest report on Iran, released November 23, the IAEA stated that the Natanz plant continues to produce uranium, including some enriched to nearly 20 percent, the minimum threshold for HEU (although 90 percent enrichment is generally needed for an atomic weapon). The agency also noted, without explanation, that Iran had added centrifuges to some of the facility's cascades; specifically, each of the altered cascades now had 174 centrifuges instead 164. Iran may have made this change to provide spare parts for each cascade in case of breakdown. In a potentially related development, Western officials recently confirmed that Natanz centrifuges appear to have been affected by the Stuxnet computer virus, reportedly capable of interfering with the speed of the machines and causing catastrophic failure. Iran's alterations could also mean that the regime is experimenting with arrangements of the cascades required for producing bomb-grade HEU.

Apart from Natanz, the IAEA reported that Iran was continuing construction at the Fordow enrichment plant near Qom, the existence of which was discovered only last year. The agency also noted that the Arak heavy-water reactor was still being built.

The section of the report titled "Possible Military Dimension" was particularly worrisome. According to the IAEA, previous reports "have detailed the outstanding issues related to possible military dimensions to Iran's nuclear program and the actions required of Iran...to resolve those issues. Since August 2008, however, Iran has declined to discuss the outstanding issues." The agency went on to note its concerns about possible undisclosed Iranian nuclear activities involving military-related organizations, including efforts connected to the potential development of a nuclear missile payload.

Why Talks Now?

American and European officials believe that Iran's willingness to reopen talks in Geneva demonstrates the effectiveness of escalating sanctions. Since 2006, the UN Security Council has adopted six resolutions condemning Tehran's nuclear posture, four of which have imposed trade and financial penalties on the country as a whole, along with travel restrictions on scientists and officials.

Whatever the case, Tehran appears to have agreed to the talks reluctantly. Initially, it asked to hold the meetings in Turkey, which it deemed a more congenial diplomatic location. The regime also regarded the agenda as problematic. Speaking this week to a crowd of supporters in northern Iran, President Mahmoud Ahmadinezhad insisted that "the people of Iran will not back down one iota" in the face of international demands to curb the nuclear program. Indeed, Iran agreed to include nuclear issues in the Geneva talks only if they are raised as part of a discussion "about international cooperation" and "solving the problems of humanity." Such rhetoric has been interpreted to mean that Iranian officials will attempt to focus the discussion on Israel's nuclear program.

Ironically, the recent WikiLeaks revelations of U.S. diplomatic cables may provide the P5+1 negotiators with added leverage. Some of the cables highlighted growing (but previously private) Arab concerns about Iran's nuclear activities, lending weight to Secretary of State Hillary Clinton's December 1 assertion that the Geneva meeting would be "an opportunity for Iran to come to the table and discuss the matters that are of concern to the international community, first and foremost, their nuclear program."

Challenges for U.S. Diplomacy


American officials face a number of challenges in Geneva. First, they must make some progress in the negotiations because diplomatic engagement with Iran has been Washington's stated (though elusive) priority since the Obama administration took office. Second, they must maintain the P5+1's diplomatic unity, particularly with regard to Russia and China, which often seem to prefer diminishing Washington's standing by exploiting diplomatic or political vulnerabilities. Third, the United States must demonstrate to its allies, particularly in the Middle East, that it can make progress with Tehran, alleviating their concerns about Iranian interference and countering the perception of weakened U.S. leadership.

Assuming the talks are not aborted prematurely, Washington has few good options for countering further Iranian stall tactics or other ploys. At the same time, U.S. officials believe they have more time to negotiate such obstacles because of Iran's apparent technical problems with its centrifuges. For its part, Tehran seems a long way from conceding that its program has or even once had any military dimensions. It may well believe that its situation mirrors that of India and Pakistan in 1998 -- that is, if Iran does carry out a nuclear weapons test, the subsequent period of international condemnation would soon give way to acceptance of a new status quo.

In any case, short of draconian trade sanctions (which Moscow and Beijing are unlikely to support) or a military strike, Washington seems resigned to treating Iran's current nuclear achievements as acceptable. Indeed, Secretary Clinton stated this week that "Iran is entitled to the use of civil nuclear power for peaceful purposes." This formulation could allow Iran to continue enriching uranium even though the country has no discernible need to produce the material domestically: the medical isotopes produced by the Tehran Research Reactor can be bought commercially from many sources, and the country's sole nuclear power reactor (the Russian-built Bushehr plant on the Persian Gulf coast, expected to go online in January) uses uranium fuel imported from Russia. Another potential negotiating option -- allowing Iran to make the low-enriched fuel rods for Bushehr -- has its own perils, given that the spent fuel could be reprocessed into plutonium. Even purely peaceful nuclear work would enable Iranian scientists and technicians to develop the skills needed for an eventual military program.

Dennis Ross, the White House's point man on Iran, stated this week that Tehran has "a decision to make," presumably between carrots and sticks. On one hand, U.S. officials are reportedly offering greater economic and energy assistance if Tehran constrains its nuclear program. On the other hand, Washington is prepared to push for further economic sanctions if necessary, further compromising Iran's ability to conduct trade and investment activity in its important oil and gas sectors.

Indeed, the Geneva talks are high stakes, in terms of both Iran's nuclearization and Washington's diplomatic standing. So far, no one is predicting that the parties will reach an agreement, and few believe that much progress will be made at all. In fact, given the potential for an acrimonious end to the meetings, agreeing on a date for the next round of talks may be the most the negotiators can hope to achieve.

Simon Henderson is the Baker fellow and director of the Gulf and Energy Policy Program at The Washington Institute.

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Sanctions on Iran: Bark or bite?

By YOEL GUZANSKY AND JONATHAN SCHACHTER 

Jerusalem Post, 12/07/2010 06:38

The current effort by the regime to save money by cutting subsidies might in fact expose a domestic Achilles heel.


 US Secretary of Defense Robert Gates recently said that the sanctions imposed on Iran “are biting more deeply” than the Iranian regime anticipated. So far, they have forced Iran to examine the costs and benefits of its behavior, but have not led to any greater flexibility in its position on nuclear development.

Some argue that the sanctions have even led Iran to harden its stance.

Recent domestic developments, however, suggest that the sanctions’ bite is growing stronger.

Though it is difficult to determine by exactly how much, the sanctions have taken a toll on government revenue. As a result, the regime has announced plans to reduce the subsidies it provides the population, which cost the treasury up to $100 billion per year (25% of GDP).

These cuts and the public’s response to them have the potential to pose a considerable challenge to the status of the regime, and even to its stability.

The anticipated result is a significant rise in the prices of cooking gas, electricity, water, foodstuffs and transportation.

Especially important is the expected rise in gas prices. While gasoline will remain very cheap relative to the rest of the world, previous efforts to reduce government subsidies (through rationing) resulted in public resentment, demonstrations and the burning of gas stations.

In the current political environment, it is likely that the opposition will exploit these economic “reforms” to gain support – a possibility for which the regime is preparing. Among other things, the regime in recent weeks deposited funds into the bank accounts of approximately 70 million Iranians as preemptive compensation for the expected price hikes.

Iran has invested great effort trying to cope with the various sanctions imposed on it since 2006. On the one hand, these efforts suggest that the country is vulnerable to sanctions. On the other, they also show that it is committed to advancing its nuclear program even at high cost.

This month, in an unusual step, Supreme Leader Ali Khamenei asked the Iranian people to be patient so the country could overcome the problems it is facing as a result of the sanctions.

IT APPEARS that the West has not decided yet what price it is willing to pay in order to prevent Iran from crossing the nuclear threshold; the UN Security Council sanctions represent the lowest common denominator.

Nevertheless, the sanctions are meaningful.

The Security Council resolution has provided legitimacy to states that have taken actions against Iran above and beyond what is required, and which otherwise would not have been taken at all. Additionally, more reluctant actors, like Russia and China, have been supportive of sanctions despite their reservations because until diplomatic efforts have been exhausted, war remains a more distant option.

The sense in the West that there are “no good options” and that the sanctions have exhausted their potential is perhaps premature. The current effort by the regime to save money by cutting subsidies – a step unprecedented since the 1979 Islamic Revolution – in fact might expose a domestic Achilles heel.

That is, the regime’s efforts to mitigate the effects of the sanctions could leave it even more vulnerable to them.

The most effective way to further constrain Iran’s financial resources is by continued and even increased pressure on the country’s limping energy sector, which accounts for 80% of export-related state revenue.

Taking advantage of this dependence on a single commodity has the greatest potential to change Iran’s cost-benefit calculations.

As is always the case, multidimensional problems demand multidimensional solutions. Sanctions by themselves are unlikely to put an end to Iran’s nuclear program. It is in this context that recently reported sabotage of uranium enrichment activity should be seen; this activity makes enrichment more costly and complements sanctions by giving them more time to work. At the same time, Western efforts – strongly encouraged by Iran’s Arab neighbors, as evident in the documents revealed by WikiLeaks – to present a credible military threat to Iran’s nuclear facilities are intended to convince the Islamic Republic that time is not on its side.

One could conclude from Iran’s actions that it is not particularly interested in compromising with the West, in part because it continues to prepare to weather sanctions for an extended period.

Only if the regime decides that the road to completing its nuclear program is too long and the price too high will there be even a chance of increased flexibility in its position.

The writers are research fellows at the Institute for National Security Studies at Tel Aviv University.

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Halt Nuclear Iran

by Prof. Efraim Inbar

BESA Perspectives 124, December 2, 2010

EXECUTIVE SUMMARY: A nuclear Iran jeopardizes regional stability in the Middle East and has far-reaching implications for global affairs. Iran's geographical location puts it in a position to dominate the strategic energy sector and create an anti-Western alliance among oil producing countries like Venezuela and Russia. Iran also seeks to create a radical Shiite corridor through Iraq, Syria and Lebanon, and may transfer nuclear bombs to terrorist groups. At this late stage, only military action can stop Iran's race for nuclearization and prevent its disastrous consequences.

Iran continues to defy the calls of the international community for a freeze on its nuclear program. Tehran, which sees a weak West in decline, persists in its strategy of "talk and build" in order to gain time for the completion of its nuclear arsenal, and it will likely be able to overcome the recent problems in its uranium enrichment program.

Unfortunately, diplomacy has run its course, while economic sanctions are generally futile. Only military action can stop Iran's race for nuclear arms.

Inaction is dangerous, as the nuclear ambitions of Iran pose a serious threat to the Middle East and have repercussions far beyond the region. This is why Israeli Prime Minister Benjamin Netanyahu has urged US Vice President Joseph Biden to give greater emphasis to the military option.

Iran's nuclear program – coupled with long-range delivery systems in particular – threatens regional stability in the Middle East. American allies, such as Israel, Turkey, Saudi Arabia and the Arabian Gulf states, are within range, as are several important US bases. Further improvements in Iranian missiles would initially put most European capitals – and, eventually, the North American continent – within range of a potential nuclear attack.

A nuclear Iran would strengthen its hegemony in the strategic energy sector by its mere location along the oil-rich Arabian Gulf and the Caspian Basin. These adjacent regions form the "energy ellipse," which holds more than 70 percent of the world's proven oil and more than 40 percent of natural gas reserves.

Improving revolutionary Iran's ability to intimidate the governments controlling parts of this huge energy reservoir would further strengthen Iran's position in the region and world affairs. Moreover, Tehran seems to be designing a strategy by which its relations with other oil producing states such as Venezuela and Russia, both anti-Western, will increase their leverage in the energy market and weaken the power of the Western buyers.

A nuclear Iran will also result in the loss of the Central Asian states for the West. After the collapse of the Soviet Union, these new states adopted a pro-Western foreign policy orientation. Following the emergence of a nuclear Iran, they will either gravitate toward Iran or try to secure a nuclear umbrella with Russia or China, countries much closer to the region, and end their alignment with the West.

Furthermore, an Iranian nuclear arsenal will unhinge the precarious nuclear balance on the Indian subcontinent. Pakistan, Iran's neighbor, will have to adjust its nuclear posture. Such an adjustment will inevitably require changes in the Indian nuclear posture, possibly creating an even more sensitive nuclear balance.

Tehran, after nuclearization, will become more active in supporting radical Shiite elements in Iraq and agitating those communities in the Arabian Gulf states. Moreover, Tehran lends critical support to terrorist organizations such as Hezbollah, Hamas and Islamic Jihad. Terrorist entities will feel more secure and confident with the backing of a nuclear Iran. The Revolutionary Guards may be reckless enough to transfer several nuclear bombs to proxy terrorist organizations. Such organizations have no moral constraints over detonating a nuclear device in a European or American harbor.

Iran is allied with Syria, another radical state with an anti-American predisposition, and seeks to create a radical Shiite corridor from Iran to the Mediterranean Sea via south Iraq, Syria and Lebanon. Such a corridor will facilitate Iranian ability to project power into the Balkans, where it has a presence in the three Muslim states of Bosnia, Albania and Kosovo. A nuclear Iran could also encourage the radicalization of Muslims in Europe. Unfortunately, Europe was not successful in fully integrating these minorities into the fabric of European society.

A nuclear Iran may be emboldened enough to destabilize Turkey. Tehran tried in the 1990s to meddle in Turkish affairs and strengthen extreme Islamist forces. Today, revolutionary Iran may capitalize on the identity crisis of Turkey to tip it in favor of an Islamist path. The government, led by the Islamist-rooted Justice and Development Party, is gravitating toward Iran.

Iran already attempted to undermine the pro-Western regime of Egypt's Hosni Mubarak in the summer of 2009. Egyptian security services caught Iranian-trained Hezbollah agents who were sent via Hamas-ruled Gaza into Egypt to engage in sabotage and link up with the Egyptian Islamist opposition.

A nuclear-armed Iran would have a chain effect, generating further nuclear proliferation in the region. Middle East leaders are unlikely to be persuaded by the US that it can provide an umbrella against Iranian nuclear blackmail or actual nuclear attack. Therefore, states such as Turkey, Egypt and Saudi Arabia would probably adopt similar nuclear postures, further undermining the Nuclear Non-Proliferation Treaty.

A multi-polar, nuclear Middle East is a strategic nightmare. The geographical proximity in the region, the lack of adequate early warning systems, the rudimentary stage of nuclear arsenals, the presence of elites newly initiated into the intricacies of nuclear strategy, regional strategies that allow brinkmanship and use of force, and the low sensitivity to cost create a strategic nightmare. A containment strategy based on deterring the ayatollahs is extremely problematic.

The discussions on post-nuclear Iran scenarios underestimate the strategic repercussions of an Iranian nuclear arsenal. At this late stage, only military action can prevent the descent of the greater Middle East into a very brutish region.

Efraim Inbar is a professor of political studies at Bar-Ilan University and the director of the Begin-Sadat Center for Strategic Studies.

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