On March 10, 2023, Iran and Saudi Arabia reached an agreement to resume diplomatic ties which had been severed for the last seven years triggered by the killing of a prominent Shi’ite cleric Sheikh Nimr al-Nimr by the latter. The agreement has been gaining special attention all over the world since two powers competing to gain strategic dominance in West Asia have agreed to come to terms, and even more so because of the agreement being brokered by a third country China which has gotten a step closer to deepening its presence in the region. However, this article intends to narrowly focus on the plausible reasons that led the Iranian regime to agree to reach this agreement.
Cementing Severed Diplomatic Ties
Following the visit of President of the Islamic Republic of Iran, Ebrahim Raisi to Beijing, Secretary of Iran’s Supreme National Security Council (SNSC) Ali Shamkhani visited Beijing on March 6, 2023, and had four days of intense discussions with his counterpart Saudi Arabia’s national security adviser Musaid Al Aiban to settle issues between their countries. This agreement, though as unusual an event it may be, is not very surprising after all. In his first speech after winning the elections, the incumbent President of Iran, Ibrahim Raisi, stated that he is willing to restart diplomatic ties with Saudi Arabia and improve trade with neighbours under the policy of ‘Neighbourliness’.
However, it is not unusual in Iranian politics to say one something about its foreign policy approach without been meaning to do it. Moreover, the first round of talks started back in Hassan Rouhani’s term. Therefore, it would be unwise to give more credit than necessary to President Raisi’s policy of ‘Neighbourliness’. It is also important to notice that before Beijing came into the picture, Oman and Iraq were mediating between Iran and Saudi Arabia and they had had five round of talks in Baghdad from 2021 to 2022 with no concrete result. The fast-changing regional dynamics and Iran’s internal situation have arguably played a key role in instrumentalising the agreement in March 2023.
Countering Regional Grouping
Given the fact that it is running proxy wars and supporting rebel groups in the region, Iran does not have many trusted allies in the region. There is an extent to which it can have sour relations with countries particularly in the neighbourhood since it may give rise to a regional grouping of countries against Iran. Post the signing of Abraham Accord, countries like Bahrain and UAE have already begun the process of normalising relations with Israel. Furthermore, backchannel talks have already been going between Saudi Arabia and Israel facilitated by the USA. Therefore, de-escalation with Saudi Arabia was in favour of Iran in the present especially because it would help undercut Israel’s efforts to isolate Iran in the region. In the light of these developments, Iran’s willingness to ease its years long rivalry with Saudi Arabia can also be seen as a policy of strategic hedging where Iran prepares for the worst by balancing Saudi Arabia by maintaining a strong military presence in the region but does not close itself from gaining whatever it can through constructive engagement.
Countering Internal Distress
Post the tragic death of Mahsa Amini, a 22-year-old Kurdish woman in September 2022 in the custody of the Morality Police (Gasht-e Irshad), the anti-hijab protests raised some serious concerns for the regime. Although the protests have waned in recent weeks due to the brutal crackdown by the clerical regime, but even they have entirely died down. However, the protests that erupted were against the draconian hijab law but were not limited to it. They were also in response to rising inflation, high unemployment, corruption, lack of opportunities due to country’s isolation among others.
The anti-hijab protest draws inspiration from a series of protests which have marked the history of the clerical regime. Many Iranians, particularly the younger population, have been raising their voice against the use of country’s wealth to fund proxy wars in the region rather than using it for their own welfare. The slogan “Neither for Gaza nor for Lebanon; my soul is sacrificed for Iran” can be heard in every protest since the Green Movement of 2009. The ruling dispensation had not witnessed such a big protest since 2009. This may have brought to light the deep-seated unsatisfaction among the population which cannot go unaddressed for long. But to alleviate the economic hardships of its citizens, the government must have money in its disposal to fix the economy and to generate employment.
Saudi Arabia: A Potential Investor
Keeping in mind the sanctions put in place by the USA, the Iranian regime has been having a hard time getting investment into the country. If this agreement works out, the Iranians will be able to reduce their expenditure that they have been bearing for years for fighting proxy wars in the region. The Saudis are supporting the Yemeni government recognised by the United Nations whereas the Iranians are backing the Houthi rebels. By coming to an agreement with the Saudis about the ongoing conflict in Yemen, Iranians can save a lot of money and resources which can be diverted to strengthen their internal situation in the country. Moreover, Iran may also have a potential investor on their table.
Under the crown Prince Mohammad bin-Salman, the diversification project, revolving around the aspirational document ‘Vision 2030’ has gained momentum in order to decrease their reliance on oil as a means of state revenue. Therefore, the Saudis are looking forward for different ventures to invest. Given the low wage labour cost due to US sanctions, Iran could be a favourable investing site for the Saudis. In light of recent discovery of large reserves of lithium in Iran, 10 percent of the world’s total, rapprochement with Saudi may help in securing foreign investment and technology since energy and infrastructure costs are high for Iran to do it on its own and due to sanctions, Iran is unlikely to get big investors other than China and Russia. However, trade and tanks seldom go together. For getting Saudi Arabia to invest in Iran, de-escalation had to happen before in Yemen.
Through this agreement, the Iranian regime aims to strengthen its regional security through engaging with a strong neighbour to prevent a regional grouping against itself. Moreover, the regime is also trying to win the confidence of its aggrieved citizens by showcasing itself as responsible and pragmatic. The official statement of the Ministry of Foreign Affairs is that the agreement shows “determination of Iranian government to protect the interest of the Iranian people and Muslim, friendly and neighbouring countries” which was hailed by Islamic Republic News Agency (IRNA), the government backed news channel in Iran. Some other conservative media outlets focused more on how this agreement signals the defeat of USA and Israel. As much as the Iranian regime may hail it in the media, one must be cautious while overestimating the outcomes of the agreement. Through supporting Houthis in Yemen, Iran has been able to build significant influence in the southwest of the Arabian Peninsula and it looks uncertain if it would abandon it. The agreement may reduce tension in the region; however, it is unlikely to settle profound differences between them in the foreseeable future.
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