Geopolitical implications of Iran-China relations in the 21st Century

China is one of Iran’s most important strategic partners. China is one of the twelve countries with visa-free access to Iran and it was also one of the countries that supported the Hong Kong National Security Law at the United Nations Human Rights Council (UNHRC). While China maintains a close relationship with Iran today, this has not always been the case. Due to external pressure from the United States, Iran and China had minimal connections during the Pahlavi period. However, after the Pahlavi dynasty was overthrown by the Iranian Revolution in 1979, the Islamic Republic of Iran and the People’s Republic of China (PRC) have become close allies: China was eager to gain access to Iran’s rich natural resources whereas an increasingly isolated Iran needed a powerful ally. The bilateral relationship was pushed forward to a new level after the beginning of the 21st century when the west imposed sanctions on Iran due to its nuclear program. As China became more prosperous and focused less on improving U.S.-China relations, it had the opportunity to expand its investments in Iran and foster trade between both countries. The relationship continues to develop after Xi Jinping became the president of China in 2013. China supports Iran’s stand on the renewal of the 2015 nuclear deal, which is at a stalemate due to conflicting views between Iran and the United States. It also signed a  25-year cooperation agreement with China in March 2021, which aims to foster economic, military, and security cooperation between both countries. 

China’s Geopolitical Ambitions

The cooperation agreement between China and Iran is not only an important milestone in Iran-China relations but also a strong reminder of China’s geopolitical ambitions. The agreement is embedded in the Belt and Road Initiative (BRI), China’s most ambitious geopolitical blueprint of the century. Initiated by Xi Jinping in 2013, the BRI, according to Yifu Lin, a former Taiwanese military officer who defected to China and became the deputy of the People’s Congress (China’s policy-making institution), was Xi Jinping’s response to Obama’s “pivot to Asia” and the Trans Pacific Partnership (TPP). Reminiscent of the ancient silk road between China and Europe, the BRI will invest in infrastructure projects such as railways and ports in different countries between Europe and East Asia. Over 60 countries have signed to or expressed their interests in one of the BRI-related projects, with an estimated expense of $1.2-1.3 trillion by 2027. Situated between Europe and East Asia, Iran’s geographical location makes it a critical spot for the BRI. The Tehran municipality purchased 367 new subway cars from China in 2019, and China launched its first sea-rail intermodal freight train to Iran in June 2022, which is considerably cheaper than traditional rail services. A leaked draft of the 25-year agreement also revealed that China is going to invest $400 million in infrastructure in Iran. The draft also mentioned the development of a new port in Jask and further investments in the energy sector. 

Although the agreement seems like a win-win for both China and Iran, it may have unforeseeable consequences on the region’s geopolitics. Indeed, while the BRI seems like an economical initiative at the first glance, it has shifted from a trade-oriented initiative to a security-oriented strategy. In 2017, China built its first overseas military base in Djibouti, a country that plays an important role in the BRI project. In addition, its location is close to other military bases of the United States and the Republic of Somaliland, a de facto state that recently established diplomatic ties with Taiwan. As for Iran, the port in Jask is critical to the country’s energy security. Chinese investment in the port involves a new pipeline between Jask and Goreh, which will provide an alternative route to the maritime route across the Strait of Hormuz, which is vulnerable to international naval tensions. BRI not only granted China key access to strategic ports in other countries but also created a toxic system. This so-called debt-trap diplomacy created an astonishing amount of debt for countries that received funding from China. Sri Lanka, with its economy crumbled by a series of white elephant projects and skyrocketing debts, is the latest victim. For a country that is heavily dependent on China such as Iran, such an agreement would have disastrous impacts on the vulnerable economy of the country. Indeed, the 25-year agreement has sparked dissent and controversy in Iran: former President Mahmoud Ahmadinejad called the agreement a ‘scandal’ and an attempt to auction Iran without the consent of its people.

Implications for the Russian invasion of Ukraine

China became more cautious of its attitude toward the war after witnessing the outcome of the invasion. China is likely to learn some lessons from the hasty invasion of Russia. Indeed, 

many factors contributed to the outcome of the war, such as poor logistics and the lack of collaborative response from the West. On the other hand, the war also provides China with an opportunity to bring its relationship with Iran to a new level. Firstly, the war provides China and Iran with an opportunity to challenge the dollar hegemony. Although the Trump administration imposed sanctions on Iranian fuel export, China has been purchasing fuel from Iran in yuan over the last three years. After the outbreak of the Russia-Ukraine war, OPEC member states such as Saudi Arabia and Venezuela also expressed their interest to accept the yuan for Chinese oil sales amid soaring tensions with the United States. Moreover, Mehdi Safari, Iran’s Foreign Minister, recently proposed that China should establish a new currency for its Shanghai Cooperation Organisation (SCO), which comprises 30 per cent of the global GDP. If these plans become reality, the political and economical influence of China, combined with Russia and Iran would pose a significant challenge to the world order established by the West and the United States. 

Secondly, Iran and China can support Russia’s war effort by collaborating with each other. Known for its vast amount of military personnel and its proven ability of reverse engineering, Iran is a formidable power in the region. Indeed, the involvement of Iran may alter the trajectory of the Ukrainian war. Both Iran and North Korea can provide considerable arms supplies to Russia, including Iranian drones that proved their ability during the Syrian war. Chinese military officials visited Tehran during a bilateral meeting in April. While the Iranian government did not give many details of the meeting, Iran and China agreed to expand military cooperation and cyber intelligence. The acquisition of Chinese drone technologies means that Iran would be able to provide Russia with drones that would adversely affect the Ukrainians. Russian military officials expressed their interest in Iranian drones when they visited Tehran in June. Jake Sullivan, the National Security Advisor of the United States, warned that Iran is preparing to provide its weapons-capable UAVs to Russia. While Iran’s foreign minister denied such accusations, the fact that Russian military officials visited one of its military bases in Iran raised speculations about Russia’s true intentions. Indeed, the Russia-Ukraine war is a testimony of the ability and flexibility of drones in modern warfare. Both sides use drones for different purposes such as surveillance and counter-attack. Equipped with Chinese technology, combat-ready drones from Iran could turn the tide of the war and hinder the West’s efforts to support Ukraine. 

Thanks to similar ideologies and the soaring tensions with the United States, Iran and China have formed one of the closest political alliances in the 21st century. International isolation, geopolitical ambitions and strategic concerns are the foundations of the Iran- China relations, and the Russia-Ukraine war is a manifestation of how the relationship could bring long-term challenges to the current world order. Although China can expand its political and economic influence by cooperating with Iran, other factors such as the infamous debt-trap diplomacy and backlash from the Iranian people may have the possibility to destabilise the relationship in the long term.