By Kabir Taneja, Observer Research Foundation
Iran’s isolation by the US, following the withdrawal by President Donald Trump from the JCPOA nuclear agreement has pushed Tehran into a corner. As its economy significantly weakens, Iran has looked towards Europe, led by Paris, to salvage some sort of middle path at the very earliest.
Even as Iran’s sense of feeling cornered plays out, some nations see opportunities in these nooks of global geo-political disruptions. “Iran is the center of everything,” a Chinese businessman operating in Iran during the period of sanctions said back in 2017 as Tehran was touted to benefit immensely from Beijing’s mammoth Belt and Road Initiative (BRI). China is already Iran’s biggest trading partner, and has steadily built capacity as western businesses and governments stepped away due to the collapse of the JCPOA amidst the US withdrawal in 2018.
Now, the Chinese may be courting Iran even more aggressively. Details of an extensive deal spread over 25 years between Tehran and Beijing reported in the media suggested a mammoth move by Beijing to prop up the Iranian economy, specifically its oil and gas sector which lies in a derelict state. Iran has put its recoverable oil reserves in 2019 at 160 billion barrels, which would make it the world’s third largest reserves.
The deal suggests a $280 billion infusion into the country’s petrochemicals sector along with further $120 billion to upgrade the country’s transport infrastructure and manufacturing sectors. Railways are one area where Iran would greatly benefit. Proposed projects ironically include rail lines connecting Iran with the troubled Xinjiang province in China via Central Asia, home to internment camps where hundreds of Uyghur Muslims are kept in detention to undergo religious “re-education” camps. Iran has not overtly criticized China on its treatment of Muslims in that region till date.
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