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Is Iran Capable of Reaching a Nuclear Deal?

U.S. Secretary of State John Kerry shakes hands with Iranian Foreign Minister Mohammad Javad Zarif in Geneva.

Negotiations over the Iranian nuclear program have become hostage to sharp internal divisions within Iran. Unless Supreme Leader Khamenei throws his weight behind the adjustments in Iran’s negotiating positions that are necessary to reach a compromise with the P5+1 countries, there will be no agreement.

An intensive round of talks is taking place this week in Geneva, with a meeting between Secretary of State John Kerry and Iranian Foreign Minister Javad Zarif, bilateral meetings between U.S. and Iranian delegations at the political directors level, and multilateral talks between the P5+1 countries and Iran. Having failed to reach agreement on a comprehensive deal by November 24th, when the first extension of the 2013 Joint Plan of Action expired, the parties agreed on a second extension and are now aiming to resolve major political issues by March and to finalize the deal, including technical annexes, by late June.

While incremental progress was made during 2014, substantial gaps remain between Iran and the P5+1 on fundamental issues, especially Iran’s permitted enrichment capacity and the duration of the agreement.

A critical U.S. goal in the negotiations is to reduce Iran’s current centrifuge enrichment capacity to the point where it would take Iran at least one year – if it decided to break out of the agreement – to produce enough highly enriched uranium for a single nuclear weapon. Achieving a one-year breakout time would require substantial cuts in both the current number of operating centrifuges and the amount of low-enriched uranium located in Iran. To build international confidence in Iran’s peaceful intentions, the United States believes that an agreement should have a duration of 15 to 20 years. And to deter and detect any covert nuclear activities, Washington requires rigorous monitoring measures that go beyond the IAEA’s Additional Protocol.

Iran’s negotiating position is largely driven by its declared goal of achieving an industrial-scale enrichment capacity (more than ten times its current operational capacity), which Iranians claim they need as soon as 2021 in order to produce fuel for the Russian-supplied Bushehr nuclear power reactor. In support of that goal, Iran has opposed all but token reductions in its current centrifuge capacity, and it has called for a short-duration agreement (five to seven years) that would allow it to ramp up its enrichment program to industrial scale at a relatively early date. Moreover, while agreeing to adhere to the Additional Protocol, it has resisted IAEA access to its military installations (which is provided for in the Additional Protocol) and has been reluctant to accept monitoring measures that go beyond the Additional Protocol.

The United States has made substantial concessions on the enrichment issue, first moving from a ban on enrichment to allowing a small enrichment program and later from a small number of centrifuges to a significantly higher number. It also agreed that once the agreement expires, Iran would be free to proceed with its enrichment program in a manner and pace of its own choosing.

With the compromises the P5+1 are prepared to accept on the enrichment issue, Iran would be in a strong position to pursue its civil nuclear energy plans. It would have sufficient enrichment capacity to produce fuel for the reactors it intends to build for research and medical isotope production. It could extend it fuel-supply contract with Russia beyond 2021 and continue importing fuel rods for Bushehr and any additional power reactors it acquires. Once the comprehensive deal expires, it would be able to increase its enrichment capacity to industrial scale.

Moreover, the P5+1 countries seem willing to cooperate with Iran in the civil nuclear field, including in such areas as modification of the Arak reactor, design and fueling of a new light-water research reactor, and even in planning the construction of an indigenously-designed Iranian power reactor. While the P5+1 proposals would lengthen Iran’s preferred timeline for achieving an industrial-scale capability, the delay would be justified by the benefits of cooperation with the advanced nuclear powers and by the additional time it would give Iran to master key technologies. If Tehran is truly interested in having an advanced nuclear energy program, the compromises offered by the P5+1 make good sense.

But Iran has hardly budged on enrichment. While it has been prepared to discuss readily-reversible modifications of its centrifuge program that would only slightly reduce its existing enrichment capacity, it has not been willing to scale back its centrifuge capability sufficiently to make a compromise possible. Given that its inefficient first-generation centrifuges will have to be phased out before long, this refusal to accept a reduction in existing capability seems less a reflection of Iran’s technical requirements than a reaction to domestic political pressures not to “retreat” in any aspect of its program.

Iran also continues to call for a short agreement that would enable it to rapidly and massively expand its enrichment program so that it would be able to produce fuel rods for the Bushehr power reactor by 2021, when the Russia-Iran fuel-supply contract expires. In a television interview last week, Ali Akbar Salehi, head of the Atomic Energy Organization of Iran, reiterated that, after eight years, Iran should have the greatly expanded enrichment capacity needed to produce fuel for the Bushehr reactor. But such a plan is totally unrealistic. In such a short timeframe, Iran cannot possibly master the highly specialized technology needed to fabricate Bushehr fuel, especially without Russian assistance, and Moscow has showed no inclination to provide such assistance. And recent Russia-Iran negotiations over the sale of additional reactors have made clear that Russia is willing to provide lifetime fuel supplies for any reactor it sells, which for Iran is clearly the safest, most efficient, and least costly option.

Tehran’s reluctance to compromise on the central issues of enrichment capacity and duration has not only created a bottleneck in the negotiations, it has also raised questions about the intentions of Iran’s nuclear program.

Although Tehran has been willing to compromise on some significant issues – for example, to significantly reduce the plutonium production capability of the Arak reactor and to re-purpose the Fordow enrichment facility – it has taken a rigid position on several other matters of importance. It continues to stonewall the IAEA’s investigation of past Iranian activities that the IAEA suspects were related to the development of nuclear weapons. It calls for the lifting of all multilateral and national sanctions even before the IAEA has reached the judgment that it is in compliance with its obligations. And while Iran was widely reported to have agreed to send most of its low-enriched uranium stocks to Russia – a very positive move that would allow the P5+1 to accept a higher number of centrifuges without shortening breakout time – Iranian officials have publicly denied that such an agreement has been reached, calling into question one of the few areas of major progress in recent months.

Reasons for Iran’s Intransigence

Why has Iran showed so little willingness to compromise on key outstanding issues, especially enrichment capacity? One explanation is that Iran has seen itself in a strong position and has felt that it only needs to wait until the United States and its partners accept a deal largely on its terms. In the run-up to the end of the last extension period in November, Iranians may have figured that the United States would make concessions on the nuclear issue in order to gain Iran’s cooperation in defeating the Islamic State and in addressing other regional issues. They may also have believed that President Obama was desperate to conclude a deal and was eager to do so before the Republicans took over the Senate. In late November, when the United States stuck to its requirements for an agreement, the Iranians presumably learned that any expectation that the Obama administration would cave in to their demands was wrong. But such an expectation may well have contributed to Iran’s rigidity in the talks.

A more fundamental explanation – compatible with the first – is that deep divisions within the Iranian elite, not just on the contents of an agreement but on the advisability of any agreement, have led to the failure to adopt a pragmatic negotiating posture that could produce an agreement. These internal divisions have produced a kind of stalemate – negotiations are allowed to proceed but Iranian negotiators are not provided the flexibility needed to reach an agreement.

There appear to be three different camps within Iran on the nuclear negotiations. The first wants an agreement, believes an agreement is necessary to rebuild Iran’s economy and end its isolation internationally, and recognizes that significant adjustments in Iran’s negotiating position are necessary to reach an agreement. The second can grudgingly accept an agreement provided it is largely on Iran’s terms. But this second camp feels Iran doesn’t need an agreement, can manage well enough economically and internationally without one, and therefore doesn’t feel compelled to make what it regards as unwarranted concessions. The third camp opposes any agreement both for ideological and self-interested reasons. It believes that any accommodation with the United States and its western partners would be a threat to the regime’s revolutionary ideals, and powerful actors within this camp fear that the lifting of sanctions under an agreement would deprive them of the opportunity to exploit the sanctions that have crippled Iran’s economy for their own economic benefit. The combined weight of the second and third camps has effectively prevented Iran from adopting a negotiating posture that would allow a compromise to be reached.

Another factor impeding the adoption of a more forthcoming negotiating position is that all Iranian political factions have begun focusing on two upcoming high-stakes elections that are widely seen as having a crucial impact on the future direction of the country – the election of the Assembly of Experts in the fall of 2015 and parliamentary elections in the spring of 2016. Conservative opponents of President Rouhani are concerned that a popular nuclear deal that gives a major boost to the Iranian economy will strengthen the forces of moderation and give them an edge in the upcoming elections. Determined to deny Rouhani and his supporters that edge, the conservatives have an incentive to make it difficult for his government to conclude such an agreement.

For their part, President Rouhani and his supporters, while strongly favoring a nuclear agreement, are concerned that their critics will pounce on any alleged weaknesses in the deal and accuse them of capitulating to Western pressures and sacrificing Iran’s rights. Such sensitivity to politically-motivated attacks may be making Rouhani and his negotiators reluctant to press for alterations in Iran’s negotiating position that are necessary to move the negotiations forward but could leave them vulnerable in the run-up to the elections.

Thus, in addition to the strength of Iran’s skeptics and opponents, the dynamics of Iranian domestic politics may be inhibiting the adoption of more flexible negotiating positions, with even proponents of a deal cautious about advocating such positions internally.

President Rouhani has been increasingly outspoken about where he stands in the internal debate. In a speech to an economic conference on January 4th, he stated that Iran’s interest in economic growth would not be served by isolation, implying that it would be advanced by an agreement that terminated the sanctions and ended its economic isolation. By suggesting that revolutionary principles and ideals have no place at the negotiating table, he was apparently advocating a more pragmatic and less ideological approach to the talks. And by expressing support for a referendum – clearly with the nuclear issue in mind – he was reminding his opponents that a nuclear deal is popular with the Iranian public, even though he knew that the likelihood of gaining the two-thirds majority in the Majlis needed to hold a referendum is very small.

While Rouhani is clearly in the pro-agreement camp, the key question is where Supreme Leader Khamenei stands among the various domestic factions, as he is the ultimate decision-maker in Tehran. The Leader has said he is “not opposed” to the negotiations and has defended Iran’s negotiators as “children of the revolution.” But his many public comments, including his speech in Qom this month, reveal strong reservations. At best, he is straddling the second and third camps described above but, more likely, he is deeply skeptical of the value of an agreement. He frequently speaks about his distrust of the United States and the West, arguing that Washington, in particular, will not be satisfied with a nuclear agreement and will press on toward its real goal of regime change. He asserted in Qom that Iran cannot count on an agreement with the West to lift sanctions and strengthen the economy. Instead, it should pursue an “economy of resistance” that relies on domestic forces and immunizes Iran against sanctions. According to the Leader, “by relying on the nation and domestic forces, we must act in such a way that even if the enemy does not lift the sanctions, no blow will be struck against the people’s progress or growth or welfare.” Thus, in his view, Iran can live without a nuclear agreement.

How Khamenei will juggle and weigh the various factors on which his nuclear decision-making will be based – including the views of key constituencies (e.g., the Rouhani administration; hardline elements in the IRGC, the media, and the Majlis; the clergy), the economic impact of sanctions and oil prices, the two upcoming elections, public opinion, and his own inclinations – is the principal unknown that will determine Iran’s posture in the negotiations and prospects for their success.

A Nuclear Deal Is Still Possible

Despite the difficulties the negotiators have had trying to break through on the central issues, a nuclear deal is still possible – one that would remove the sanctions that have devastated Iran’s economy and enable Iran to pursue its ambitious nuclear energy program (albeit in a longer timeframe than it would prefer), while at the same time lengthening Iran’s potential breakout time to at least a year and giving the international community confidence that Iran’s nuclear program is peaceful. To arrive at such a deal, many technically complex and politically sensitive issues will have to be resolved, including the design of the Arak reactor, the purpose of the Fordow facility, the disposition of excess centrifuges, centrifuge research and development, IAEA monitoring measures, the question of the “possible military dimensions” of Iran’s nuclear program, and the phasing and pacing of sanctions removal. But enrichment capacity and duration remain the central issues. If they can be resolved, the others are likely to fall into place, although not so quickly or easily.

On the question of enrichment, such a deal might require Iran to reduce its existing operational capacity (9,400 first-generation centrifuges) by about a half. On duration, the deal might be in force for 15 years, perhaps with the incremental relaxation of some of its restrictions in the final five years. For example, between years 10 and 15, Iran might be permitted to gradually build its centrifuge capacity back up to the current level. After 15 years, Iran would be free to pursue its nuclear energy programs as it sees fit, subject to any measures that have been agreed, such as adherence to the Additional Protocol and no reprocessing.

It is not just President Rouhani’s critics who would find these compromise solutions difficult to accept. Like Rouhani, President Obama faces domestic challenges to his administration’s approach to the nuclear negotiations, especially from Republican members of Congress but also from a significant number of Democrats. While some of the American critics probably oppose any nuclear agreement and would be happy to scuttle the negotiations, many others believe that only stronger sanctions will provide the leverage needed to get Iran to accept a good agreement. Proposed legislation is now under active consideration in Congress that would provide for tough new sanctions, perhaps not imposed immediately but only if an agreement is not reached by the end of the current extension period or if Iran violates the interim agreement.

The administration strongly opposes new sanctions legislation, even if sanctions would only be triggered in the future. It believes that sanctions were critical in achieving the progress that has been made to date and that sanctions will remain critical in providing the leverage needed to get an acceptable final deal. But it doesn’t regard new sanctions as necessary at this time – because existing sanctions remain in place and are continuing to put Iran under strong pressure (as is the sharp drop in the price of oil) and because Congress can enact new sanctions very quickly if they are warranted by a future development, such as the failure to reach agreement by the end of the current extension period. Moreover, the administration is concerned that new sanctions legislation could seriously undercut the negotiations. Even if Iran doesn’t follow through on its threat to walk out of the talks, a new sanctions law would strengthen the hand of Iranian conservatives. These hardliners would argue that, because the United States is not serious about removing sanctions and because Obama does not have the strength to deliver on his commitments, there is no point in making further concessions. They would use the Congressional action as a pretext to call for toughening rather than relaxing Iran’s negotiation positions.

If the Congress passes a new sanctions bill that the administration considers damaging to prospects for negotiations, President Obama is very likely to veto it. Senior administration officials would then go into overdrive in finding the 34 Senate votes necessary to sustain the veto, focusing heavily on Senate Democrats. Although some Democrats can be expected to vote to override the veto, a substantial number, including some who have reservations about the negotiations, will not want to be seen as undermining the best prospect for resolving the nuclear issue peacefully or as undercutting their party’s president on a matter of such high priority. It is therefore likely that the administration will have the votes to sustain the veto and prevent legislation potentially damaging to the negotiations from being enacted.

So while the Republican-controlled Congress will undoubtedly give the administration a tough time, it is likely that President Obama will be able, without legislative interference, to continue negotiating an agreement that he believes is in the U.S. interest.

Although both presidents face domestic opposition, the domestic obstacles are more formidable on the Iranian side. Iran’s failure to show sufficient flexibility over the last year on the central issues in the nuclear negotiations has raised questions not just about its willingness to reach a balanced agreement but also, given internal divisions, its ability to do so. The answer to the question of whether Iran is capable of reaching a nuclear agreement lies with the Supreme Leader. If he is prepared to overcome his own reservations, overrule hardline opponents of a deal, and give his negotiators the green light to work out the necessary compromises, there can be an agreement. If not, there will be no deal.

This article originally appeared in The National Interest under the title "Will Iran Play Ball in Nuke Talks?"