Chabahar and China Dr Naazir Mahmood


As China and Iran were getting closer to each other on Chabahar, on July 15 some explosions were heard and mysterious fires broke out in the port city of Bushehr. The fire gutted seven boats on the port where a big shipyard makes seafaring vessels.

Interestingly, when Iran was excluding India from the Chabahar project, many sensitive installations and defence-related buildings came under fire. These included a missile factory, a power plant, a medical centre and even a nuclear installation. It is not clear if these fires erupted spontaneously or they were ignited on purpose. Earlier, in the northeastern city of Mashhad too, an industrial area witnessed a huge fire in a gas reserve. Six tanks were gutted and one of them was totally destroyed as a result of a massive explosion. Just one day before that, in the southwestern city of Mahshahr a petrochemical factory caught fire mysteriously and oil started leaking.

In the same week in Tehran a residential complex experienced massive explosions when gas cylinders burst into flames. The Iranian authorities did not rule out a foreign hand behind these explosions and fires. There may also be some disaffected Iranian groups working against the government. But all this may also have some connection with the recent developments between China and Iran. They have signed an important agreement recently which is likely to have far-reaching impact not only on bilateral relations between China and India but may also result in some distancing between India and Iran.

The agreement between China and Iran attracted the attention of international media which gave it ample coverage. Despite the vagaries of the Covid-19 pandemic, major newspapers carried the news about the agreement. A salient feature of this deal is that for at least the next quarter of a century it will define both strategic and trade relations between the two countries. Such close cooperation between China and Iran may spur major changes in this region as both America and India will see their interests being affected. China is likely to gain much and will be in a better position to assert its dominance even in the Persian Gulf.

Within days after signing the agreement, Iran announced that it would go on its own to develop the railway line that was supposed to be a joint project with India. Then the same happened with the gas project. All this was necessitated because India could not fulfil its commitments to offer the required resources on its part of the deal. It is worth recalling that in 2016, Afghanistan, India, and Iran had signed a deal stipulating a railway track from Chabahar to Zahedan. India had promised to contribute a major portion of the resources needed.

Iran has announced that it will go for it alone. The recent agreement between China and Iran involves as much as 400 billion dollars under which China will get crude oil from Iran on concessional prices for the next 25 years. China has promised to invest heavily in Iran in the coming years. This has happened when America, Europe, India, and other countries of the world are trying to tackle the Covid-19 pandemic, while China and Iran quietly moved forward on this important deal. The US has no other option but to cry foul and threaten to impose more sanctions.

In practical terms neither America nor India are in a position to create any problems for China and Iran. According to the details released by the Iranian news agency ‘Tasneem’ the article number six of the agreement stipulates that both signatories will work together in the fields of energy, infrastructure, industry, and technical cooperation, and this will gradually increase over the next 25 years. Though the Chinese and Iranian governments have signed the agreement, it appears that Grand Ayatollah Ali Khamenei has supported this deal. He has been a vocal opponent of the deal that President Rouhani had signed with the US and other western powers.

Khamenei has always called for severing all relations with the US but President Rouhani wanted to improve ties with the US by agreeing to stop Iran’s nuclear enrichment programme for good. Khamenei has repeatedly given the example of Libya whose leader Muammar Gaddafi had signed a similar agreement and dismantled all nuclear capabilities but still the US and other Western powers were not happy. They facilitated the removal of Gaddafi and nearly destroyed the Libyan state. Now the new agreement between China and Iran needs ratification by the Iranian parliament after which it will be made public in its entirety.

To date we just know its salient points that were agreed to in June 2020 with a clear announcement of future collaboration in culture, politics, security, and trade. Both countries claimed that they had common ideas and considered each other allies. At least one common feature between the two governments is that both employ political repression and crush any opposition that they find challenging their authoritarian regimes. Both violate human rights with impunity. If China suppresses diversity and difference of opinion from Kashghar in Xinjiang to Hong Kong, Iran does the same with religious minorities.

Iran is a nominal democracy which is more like a medieval theocracy; whereas China claims to be a communist regime. It is surprising how a staunchly religious Iranian government can cooperate and become friends with an atheist government. Perhaps, gas and oil are more important than faith/belief and with a promise to invest over 200 billion dollars even a theocracy can set aside its religious aspirations internationally; though it will not do so domestically or even with Saudi Arabia. In addition, China has also promised over a 100 billion dollars’ investment in infrastructure.

China needs gas and oil that Iran will give at concessional prices. Now, both Afghanistan and Pakistan can play their cards smartly by offering to serve as a bridge between China and Iran. It appears that as soon as the US withdraws from Afghanistan, China will jump in. Perhaps, that is the reason the Taliban continue with their terrorist activities. There seems to be some thinking that after the American withdrawal, the Taliban can once again be installed in Afghanistan so that the American and Indian interests can directly be reduced.

But this is a dangerous game, because the Taliban are a terrorist organization that has already wreaked havoc in this region, especially during their five-year rule in Afghanistan from 1996 to 2001. Another feature of this new agreement is that China will facilitate 5-G technology in Iran to boast the fifth generation of mobile communication. This technology will enable Iran to improve its mobile communication infrastructure with which you can download hundreds of hours of video recordings within seconds. China is the undisputed master of this technology now, especially Huawei which left many American and Western companies far behind.

That is one reason the US imposed sanctions on Huawei and also urged the British government to cancel its agreements with it. Ostensibly, the American argument is that Huawei will steal American and Western secrets. China is unstoppable in this sector and keeps moving fast. Even in banking and telecommunications, China is expanding its influence making it possible for Iran to bypass American sanctions in international banking. China has also committed to developing sea ports, railways, and road infrastructure for which India does not have the required wherewithal nor does it have the technical knowhow and resources to complete huge projects as quickly as China has been doing.

Then, perhaps the increasing bonhomie between Modi and Trump has also antagonized Iran, and similarly the increasing closeness between India and Saudi Arabia may also be one factor. All this has prompted Iran to keep a certain distance with India; how long lasting that will be, only time will show.