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  HOME | Business & Economy (Click here for more)

Iran Seeks Iraq’s Aid on Sanctions

TEHRAN – Iranian President Hassan Rouhani is seeking to boost economic links with Iraq on his first official visit to the neighboring country, at a time when the United States is upping efforts to curb Tehran’s regional influence.

A strong relationship with Iraq – a former enemy – is now paramount in Iran’s foreign policy.

Tehran is looking for Baghdad’s support to mitigate the effects of sanctions reimposed by the US after it pulled out of the 2015 multilateral Iranian nuclear deal last year.

While Iraq is a major oil producer, it still relies on natural gas from Iran for more than 40 percent of its electricity. Power shortages drove widespread protests in Iraq last year.

Iranian armed forces assisted Iraq in ousting Islamic State from its territory after a devastating three-year war against the extremist group.

The two countries share a 900-mile border and are home to Shiite Muslim-majority populations, helping create closer ties between them since the 2003 US invasion of Iraq.

During his three-day visit starting Monday, Rouhani is expected to leverage Tehran’s relationship with Baghdad to explore ways to keep Iranian natural gas flowing to its western neighbor and boost other trade.

In a joint press conference with Iraqi President Barham Salih, Rouhani said Iran had stood by Iraq’s people and its army during difficult times – in a nod to Iran’s role in battling Islamic State.

“Stability and security, and democracy in Iraq, are very important for us,” Rouhani said. “We do not seek to be allied against others, but rather seek to invite other regional states to our alliance as well.”

Salih, in turn, thanked his Iranian counterpart for support during “the war against terrorism,” adding, “Iraq is lucky with its Muslim neighbors in Iran and Turkey, and lucky with its Arab roots.”

The two presidents discussed establishing joint industrial zones, linked railways and deeper energy cooperation, Salih said.

Rouhani, who is accompanied by a political and economic delegation, also met Iraqi Prime Minister Abdel Abdul-Mahdi to discuss joint economic projects and cooperation against terrorism, they said in a joint press conference.

The two leaders signed a number of memorandums of understanding on oil, trade, transportation and health – though they didn’t give details – and said they would do away with visas to ease travel for businessmen and investors between the two countries.

Abdul Jabbar Ahmad, a political-science professor at Baghdad University, said Rouhani’s visit could portend a change in Iran’s relations with the Arab world.

“This might be a first key step to achieve regional security,” he said, adding that the Iraqi government should expect the visit to vex its American partners.

The visit comes as the Trump administration has amped up pressure on Tehran and warned other countries against trading with Iran.

Over the past few months, US officials have visited Baghdad to try to persuade Iraq to wean itself off Iranian energy and secure Washington’s continued political influence in the country.

Trump traveled to Iraq in December, his first visit to US soldiers in a combat zone. The president has promised to withdraw troops from Syria and Afghanistan but said he would use Iraq as a base to monitor Iran. That drew criticism from Iraqi politicians as it diverges from the US’s stated goal in the country of fighting terrorism and training Iraqi troops.

US officials have since sought to smooth ties with Baghdad.

The US and Saudi Arabia, which is also vying for a stake in Iraq’s future, are working to offer Iraq energy alternatives and to drive a commercial wedge between Baghdad and Tehran.

But American officials have said Iraq will need more time to reduce its dependence on Iran’s power supply.

In December, Washington granted Iraq a three-month waiver to purchase Iranian gas.

Links between Iran and Iraq run deep. Perhaps no issue is more important to Iran’s foreign policy than its relations to Iraq, with which it waged a calamitous war in the 1980s in the wake of Iran’s Islamic Revolution.

The fall of Iraq’s Saddam Hussein allowed the two Shiite-majority nations to develop closer relations. Iran sees Iraq as paramount to its own security, and has for over a decade supported Shiite Iraqi militias, which are funded to a large extent by the Iraqi state but commanded by Iran.

“Rouhani’s visit is a historical visit aimed at launching a different type of relations between our two countries and peoples than in the past,” said Abdul-Mahdi, the Iraqi prime minister. “Iraq and Iran are neighboring countries and relations between us may be the oldest in the world.”

Rouhani is also expected to meet Iraq’s chief Shiite cleric, Ayatollah Ali al-Sistani, an encounter that would indicate Iran’s rising standing in Iraq.

Sistani, one of the world’s leading Shiite authorities, rejected a visit from Rouhani’s predecessor Mahmoud Ahmadinejad in 2013.

Iraq is also one of Iran’s top non-oil export markets, with a trade volume of $9 billion in agricultural products and construction materials, as well as cars and home appliances.

US sanctions, meant to choke Iran financially, have helped increase that trade by weakening the Iranian currency and allowing cheap Iranian goods to flow into Iraq.

 

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