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Iran: U.S. concerns and policy responses.

Foreign Policy and Support for Terrorist Groups

Iran's foreign policy is a product of the ideology of Iran's Islamic revolution, blended with longstanding national interests. Some U.S. observers interpret Iran's foreign policy objectives as attempting to overturn the power structure in the Middle East that Iran believes favors the United States, Israel, and Sunni Muslim regimes such as Egypt, Jordan, and the Gulf states. Iran couches that policy as support for an "oppressed" underclass, while denying any intent to empower fellow Shiites. Iran and its supporters interpret Iran's policies as attempting to thwart a U.S. goal of isolating Iran to the point where its Islamic revolution can be overturned.

Some argue that Iran's foreign policy is ineffective. Countries in the region have helped the United States enforce strict sanctions against Iran. Iran's strategic position is threatened by the civil conflict in Syria, in which Iran's closest Arab ally, Bashar Al Assad of Syria, has lost control of a considerable amount of the country. Assad has been key to Iran's efforts to position itself to strategically counter Israel. Another key ally, the Shiite-dominated government of Iraq, is facing a significant Sunni rebellion that has put nearly half that country out of central government control. On the other hand, Rouhani's election and the nuclear deal have made some of Iran's historic adversaries in the Persian Gulf and elsewhere somewhat more willing to engage with Iran on bilateral and regional issues.

Support for International Terrorism

Iran's foreign policy has made use of groups that are named as terrorist organizations by the United States. Iran was placed on the U.S. list of state sponsors of terrorism ("terrorism list") in January 1984. The State Department report on international terrorism for 2013, (43) released April 30, 2014, stated that Iran "continued its terrorist-related activity" in 2013 and that Iran "also increased its presence in Africa and attempted to smuggle arms" to oppositionists in Yemen and Bahrain. In 2012, Iran allegedly backed terrorist plots against Israeli diplomats and officials in such countries as India (in which the wife of an Israeli diplomat was wounded in an attack in Delhi in on February 13, 2012), Bulgaria (where a July 19, 2012, bombing killed five Israeli tourists), Thailand, Georgia, and Kenya. Other alleged plots took place in Azerbaijan and Cyprus.

In 2011 and 2012, U.S. officials asserted that Iran might be planning acts of terrorism in the United States itself. The assessment was based largely on an alleged Iranian plot, revealed on October 11, 2011, by the Department of Justice, to assassinate the Saudi Ambassador to the United States.

Some assert that Rouhani seeks to curb Iran's support for militant movements in the region because their activities could injure his goals of broader international engagement. However, many doubt that Rouhani is able to curb Iranian support for terrorism. Rouhani is perceived as having no ability to remove the head of the Qods Force, Qasem Soleimani, who runs Iran's external operations and reports directly to Khamene'i. (44)

In prior decades, Iranian terrorism took the form of assassinating dissidents abroad. In the late 1980s and early 1990s, Iran allegedly was responsible for the assassination of several Iranian dissidents based in Europe, including Iranian Kurdish dissident leader Abdol Rahman Qasemlu, several other Kurdish leaders (including those killed at the Mykonos cafe in Berlin in September 1992), the brother of PMOI leader Masud Rajavi, and several figures close to the late Shah of Iran. In May 2010, France allowed the return to Iran of Vakili Rad, who had been convicted in the 1991 stabbing of the Shah's last prime minister, Shahpour Bakhtiar. Iran has not been accused of dissident assassinations abroad in well over a decade.

Foreign Policy: Relations with the Persian Gulf States

Most of the leaders of the Persian Gulf monarchy states (Gulf Cooperation Council, GCC: Saudi Arabia, Kuwait, Bahrain, Qatar, Oman, and the United Arab Emirates) are concerned about Iran's influence and intentions in the Gulf and broader region. These states, all controlled by Sunni-led governments, are cooperating with U.S. policy toward Iran politically, economically, and militarily. Still, the GCC states often seek to lower tensions with Iran, and Qatar, Oman, UAE, and Kuwait welcomed visits by Iranian Foreign Minister Zarif and his aides subsequent to the November 2013 JPA agreement. At the same time, GCC leaders are concerned a comprehensive nuclear deal could lead to a U.S.-Iran rapprochement and possibly weaken the U.S. commitment to Gulf security.

* Saudi Arabia. Iran and Saudi Arabia represent opposing interests in the region; Saudi Arabia sees itself as leader of the Sunni Muslim world and views Shiite Muslims, including those in eastern Saudi Arabia, as heretical. In speeches and statements, senior Saudi officials have criticized the Obama Administration's engagement with the Rouhani government. Saudi alarm over Iranian influence in the Gulf was a major factor in the military intervention by Saudi Arabia on behalf of the Bahrain government in March 2011. The Saudis repeatedly criticize Iran for past actions, including inspiring violent demonstrations at some Hajj pilgrimages in Mecca in the 1980s and 1990s--which caused a break in relations from 1987 to 1991. The Saudis also often accuse Iran of stoking Shiite oppositionists in the Gulf, including within the Kingdom itself. (45) Saudi leaders have threatened to try to acquire a nuclear weapon if Iran acquires one. However, apparently seeking to cooperate with the recent U.S. emphasis on diplomacy with Iran, in May 2014 the Saudi government announced it had invited Foreign Minister Zarif to visit. Iran has accepted the invitation, but the visit has not occurred, to date.

United Arab Emirates (UAE). Like Saudi Arabia, UAE tends to take hardline positions on Iran's nuclear program and its influence in the region. Relations with Iran remain colored by the April 1992 Iranian expulsion of UAE security forces from the Persian Gulf island of Abu Musa, which it and the UAE shared under a 1971 bilateral agreement. (In 1971, Iran, then ruled by the U.S.-backed Shah, seized two other islands, Greater and Lesser Tunb, from the emirate of Ras al-Khaymah, as well as part of Abu Musa from the emirate of Sharjah.) The UAE has sought to refer the dispute to the International Court of Justice (ICJ), but Iran has insisted on resolving the issue bilaterally. (ICJ referral requires concurrence from both parties to a dispute.) The issue reignited on April 11, 2012, when then-president Ahmadinejad visited Abu Musa. In May 2012, IRGC Commander Mohammad Ali Jafari, accompanied by several Majles deputies, visited the island and discussed developing a tourism industry there. Yet, in the aftermath of the JPA and a visit to Iran by the UAE's Foreign Minister, in early 2014 the two countries reportedly made progress toward resolving the islands dispute. Iran reportedly removed some military equipment from them. Despite the territorial and political disputes, the UAE and Iran maintain relatively normal trade and diplomatic ties. Earlier, to avoid antagonizing Iran, in May 2007 the UAE received then president Ahmadinejad (the highest-level Iranian visit since the 1979 revolution) and allowed him to lead an anti-U.S. rally of several hundred Iranian-origin residents of Dubai--a community that numbers about 300,000.

* Qatar is wary that Iran might eventually seek to encroach on its large North Field (natural gas). It shares that field with Iran (called South Pars on Iran's side) and Qatar earns large revenues from natural gas exports from it. Qatar's fears have been heightened by occasional Iranian statements, such as one in April 2004, when Iran's deputy oil minister said that Qatar is probably producing more gas than "her right share" from the field and that Iran "will not allow" its wealth to be used by others. Possibly to try to ease such implied threats, Qatar invited Ahmadinejad to the December 2007 GCC summit there.

* Bahrain is about 60% Shiite-inhabited, many of whom are of Persian origin, but its government is dominated by the Sunni Muslim Al Khalifa family. In 1981 and again in 1996, Bahrain publicly accused Iran of supporting Bahraini Shiite dissidents in efforts to overthrow the ruling Al Khalifa family. Bahrain has accused Iran of supporting the post-2011 uprising against the Al Khalifa regime by mostly Shiite demonstrators, although the November 2011 final report of the Bahrain Independent Commission of Inquiry (BICI) concluded there is no evidence to indicate Iran instigated the protests. On February 21, 2013, the government said that the IRGC had helped form a Bahraini cell to recruit other agents and store weapons in Bahrain for possible attacks on officials and key locations. (46) On December 30, 2013, following a two-day raid, Bahraini authorities seized a ship, originating in Iraq, allegedly carrying Iranian weaponry and bomb-making material for the Bahrain opposition. (47) The State Department report on international terrorism for 2013 asserted that Iran has attempted to provide arms and other aid to Shiite militants in Bahrain. Earlier, tensions flared several times after July 2007 over Iranian attempts to question the legitimacy of a 1970 U.N.-run referendum in which Bahrainis opted for independence from Iran.

* Oman. Of the GCC states, the Sultanate of Oman is closest politically to Iran. During the Shah's rule, Iran sent troops to help the Sultan suppress rebellion in the Dhofar region. Sultan Qaboos made a state visit to Iran in August 2009, coinciding with the second inauguration of Ahmadinejad and related unrest inside Iran over his reelection. He visited again in late August 2013, reportedly to explore concepts for improved U.S.-Iran relations and what eventually became the JPA. Rouhani visited Oman in March 2014, the only GCC state he has visited since taking office. Some press reports say Omani officials turn a blind eye to or cooperate in the smuggling of western goods to Iran. Oman and Iran held some joint naval search and rescue exercises in early April 2014.

* Kuwait. Kuwait had pursued ties to Iran as a counterweight to Saddam Hussein, who invaded Kuwait in August 1990. After Saddam's overthrow in 2003, Kuwait has become more distant from and critical of Iran. During 2010-2011, Kuwait and Iran arrested persons they accused of spying for or plotting attacks in the other. (48) However, as the GCC countries increasingly engaged with Rouhani and his government, in early June 2014, Amir Sabah al-Ahmad Al Sabah became the first leader of a GCC country to visit Iran. About 25% of Kuwaitis are Shiite Muslims, and Iran supported Shiite radical groups in Kuwait in the 1980s as a means to try to pressure Kuwait not to support the Iraqi war effort in the Iran-Iraq War (1980-1988), as listed above.

Yemen

Yemeni leaders have long claimed that Iran was trying to destabilize Yemen, which underwent a leadership transition in January 2012 following an uprising. DNI Clapper testified on January 29, 2014, that Iran will likely continue to "provide arms and other aid to ... Houthi rebels" in Yemen. These assertions were reiterated in the State Department terrorism report for 2013, cited earlier. Some accounts say that the Quds Force is using small boats to ship in AK-47s, rocket-propelled grenades, and other arms to replace older weapons used by the Houthis. In January 2013, U.S. Ambassador to Yemen Gerald Feierstein accused Iran of supporting secessionist Yemeni leaders, particularly Ali Salim al-Baidh, who is in exile in Beirut. Perhaps as a response to the alleged Iranian intervention in Yemen, in January 2014 gunmen assassinated an Iranian diplomat in Yemen's capital, Sanaa.

Iranian Policy in Iraq (49)

The U.S. military ousting of Saddam Hussein in 2003 benefited Iran strategically by removing a long-time antagonist and producing a government led by Shiite Islamists who have long-standing ties to Iran. Iran has strongly backed the government of Prime Minister Nuri al-Maliki, a Shiite Islamist who has lived in Iran and is viewed by Tehran as a loyal and somewhat pliable ally. Maliki has supported most of Iran's regional goals, including keeping Bashar Al Assad of Syria in power, in part by allowing Iran to overfly Iraqi airspace to supply the Syrian military. (50)

The June 2014 offensive led by the Islamic State of Iraq (ISIS) threatened to destabilize Maliki and Iran responded quickly with Qods Force advisers, intelligence drone surveillance, weapons shipments, and other assistance. Iran is also aiding Maliki by reactivating Shiite militias such as the Promised Day Brigade, As'aib Ahl Al Haq (League of the Righteous) and Kata'ib Hezbollah (Hezbollah Brigades), and the Mahdi Army of Moqtada Al Sadr. Kata'ib Hezbollah has been named a Foreign Terrorist Organization (FTO) by the United States. Prior to the June 2014 crisis in Iraq, these groups were evolving from militias into political organizations, although several of them had, with Iranian encouragement and assistance, sent fighters to Syria to fight on behalf of the Assad regime. Many Iraqi Shiite militiamen who went to Syria have returned to Iraq. The revival of the militias is increasing tensions with Iraq's Sunnis, including those who still live in Baghdad and fear Shiite sectarian violence. Many Shiite militia forces had gone to Syria to help President Asad but returned to Iraq after the fall of Mosul to help defend Baghdad.

The rapidity of the collapse of Iraqi forces in Mosul and other parts of Iraq in June 2014 appeared to align the interests of Iran and the United States in preventing an IS seizure of Baghdad. Secretary of State John Kerry said in an interview that the United States was "open to discussions [with Iran on Iraq] if there's something constructive that can be contributed by Iran." (51) U.S. diplomats reportedly discussed the situation in Iraq at the margins of the June 16, 2014, talks on Iran's nuclear program, reportedly seeking Iran's cooperation to compel Iraq's Prime Minister Maliki to share power or be replaced outright. (52) No decision on direct cooperation on Iraq was announced after that meeting.

Many observers remain skeptical that that the United States could or should cooperate with Iran on Iraq. Iran has been a staunch supporter of the Shiite-led government in Iraq and those in Iran who control policy toward Iraq do not necessarily share the U.S. goal of creating a broad-based, inclusive central government. Iran reportedly is open to supporting other Shiite leader as an alternative to Maliki, although as Prime Minister but has not publicly insisted he be replaced. (53)

Iraq conducts a full spectrum of trade with Iran, sometimes running afoul of U.S. sanctions against Iran. On July 31, 2012, the United States sanctioned the Elaf Islamic Bank of Iraq for conducting sanctionable banking transactions with Iran, although the sanctions were removed in May 2013 when Elaf bank ceased the activity. In July 2013, Iraq and Iran signed an agreement for Iran to export natural gas to Iraq through a pipeline under construction; the project is potentially sanctionable under the Iran Sanctions Act. Press reports in late February 2014 said Iraq agreed to a deal for nearly $200 million worth of Iranian arms and ammunition--shipments that would violate Resolution 1747 on Iran--but Iraqi officials have told CRS the deal was cancelled shortly after it was signed. (For more information, see CRS Report RS20871, Iran Sanctions, and CRS Report RS21968, Iraq: Politics, Governance, and Human Rights.)

Supporting Militant Anti-Israel Groups

Iran has long opposed Israel as a creation of the West and an oppressor of the Palestinian people and other Arabs. Former president Ahmadinejad went well beyond that to statements that Israel should be destroyed. The Supreme Leader has repeatedly called Israel a "cancerous tumor." Iran has hosted numerous conferences to which anti-peace process terrorist organizations were invited (for example: April 24, 2001, and June 2-3, 2002). President Rouhani has sought to soften Iran's image on this issue, in part by publicly issuing greetings to the Jewish community on the occasion of the Jewish New Year (Rosh Hashana) in September 2013. Despite that outreach, in March 2014, Khamene'i questioned the Holocaust--an issue that Ahmadinejad had raised during his presidency and for which he had incurred major international criticism.

Iran's support for Palestinian militant groups has long concerned U.S. administrations. The State Department report on terrorism for 2012 repeated previous year's reports assertions that Iran provides funding, weapons, and training to Hamas, a faction of Palestinian Islamic Jihad (PIJ), the Al Aqsa Martyr's Brigades, and the Popular Front for the Liberation of Palestine-General Command (PFLP-GC). All are named as foreign terrorist organizations (FTO) by the State Department for their use of violence against Israel. During the second Palestinian intifada ("uprising") in January 2002, Israel intercepted a ship (the Karine A) carrying about 50 tons of Iranian-supplied arms bound for the Gaza Strip. The formal position of the Iranian Foreign Ministry is that Iran would not seek to block an Israeli-Palestinian settlement but that the process is too weighted toward Israel to yield a fair result.

Iran and Hamas

For well over a decade, the State Department annual report on terrorism, including the report for 2013, has said that Hamas (named as an FTO) receives funding, weapons, and training from Iran. However, the State Department report noted that Hamas' position on Syria has caused the Iran-Hamas relationship to deteriorate somewhat. Largely out of sectarian sympathy with the mostly Sunni protesters and rebels in Syria, Hamas opposed the efforts by Asad to defeat the rebellion militarily. Hamas' Syria-based leaders left Syria in late 2011. Iran has tried to rebuild the Hamas relationship since late 2012 by reportedly providing "missile technology" that Hamas has apparently used to construct its own rockets including during the November 14-22, 2012, conflict between various Palestinian militant groups and Israel. Prior to the conflict, Iran reportedly supplied pre-built missiles, such as the "Fajr-5," to Hamas via Sudan, from where the gear was trucked into Gaza through Egypt.

Hamas and Iran forged a relationship in the 1990s as part of an apparent attempt to disrupt the Israeli-Palestinian peace process through a campaign of Hamas suicide bombings and other attacks on buses, restaurants, and other civilian targets inside Israel. In recent years, however, Hamas has directly involved itself in Palestinian politics and its terrorist activities appear to have diminished. Iran's attempts to position its allies to strategically threaten Israel were strengthened by Hamas successes, such as its victory in the January 25, 2006, Palestinian Legislative Council elections, and even more so by Hamas's June 2007 armed takeover of the Gaza Strip. Iran provided material support to Hamas during the Israel-Hamas conflict in Gaza (December 27, 2008-January 17, 2009). In March 2011, Israel intercepted a ship, the Victoria, off its coast, and seized a large quantity of mortars and C-704 cruise missiles that Israel said were bound for Hamas in Gaza. On March 5, 2014, Israeli intercepted a ship in the Red Sea that Israel said was carrying Iranian "advanced weaponry" bound for militants in Gaza, possibly via Sudan.

Iran and Hezbollah (54)

Lebanese Hezbollah is Iran's chief protege movement in the region. The 2014 U.S. intelligence community worldwide threat assessment, referenced earlier, states that Hezbollah "has increased its global terrorist activity in recent years to a level that we have not seen since the 1990s." The relationship began when Lebanese Shiite clerics of the pro-Iranian Lebanese Da'wa Party began to organize in 1982 into what later was unveiled in 1985 as Hezbollah. Iran's political, financial, and military aid to Hezbollah has helped it become a major force in Lebanon's politics and Iran reportedly has been instrumental in persuading Hezbollah leaders to become directly involved in the Syria conflict on behalf of Assad. The State Department terrorism report for 2012 repeated previous years' assertions that Iran " has provided hundreds of millions of dollars in support of Hezbollah and has trained thousands of Hezbollah fighters at camps in Iran."

Hezbollah's attacks on Israeli forces in southern Lebanon contributed to an Israeli withdrawal in May 2000, but Hezbollah maintained military forces along the border. Although Iran likely did not instigate Lebanese Hezbollah to provoke the July-August 2006 war with Israel, Iran has long been its major arms supplier. Hezbollah fired Iranian-supplied rockets on Israel's northern towns during the fighting, including at the Israeli city of Haifa (30 miles from the border) (55) and in July 2006 hit an Israeli warship with a C-802 sea-skimming missile probably provided by Iran. During the conflict, Iran also sent additional QF personnel--augmenting its 50 QF contingent there--to advise Hezbollah and help it operate the Iran-supplied weaponry. Even though Hezbollah reduced its overt military presence in southern Lebanon in accordance with U.N. Security Council Resolution 1701 (July 31, 2006), Hezbollah was perceived as a victor in the war for holding out against Israel. Since that conflict, Iran has resupplied Hezbollah with at least 25,000 new rockets (56) and several hundred Iranian-made "Zelzal" (Earthquake) missiles with a range of 186 miles (capable of reaching Tel Aviv from south Lebanon). In November 2009, Israel intercepted a ship that it asserted was carrying 500 tons of arms purportedly for Hezbollah.

Iran has been a political beneficiary of Hezbollah's growing influence over decision-making and leadership selections in Lebanon. The movement now plays a major role in all major selections. The Lebanese Armed Forces (LAF) is considered unable to defeat Hezbollah's powerful militia and rarely acts against Hezbollah's forces or interests.

However, there has been more vocal criticism of Hezbollah within and outside Lebanon because it supports its other key patron, Syrian President Assad, against a Sunni-led rebellion in Syria. That involvement has diluted Hezbollah's image as a steadfast opponent of Israel by embroiling it in war against fellow Muslims. On April 30, 2013, Hezbollah Secretary General Hassan Nasrallah openly admitted that Hezbollah fighters are helping Assad. Iranian financial and logistical help has facilitated the Hezbollah intervention in Syria. Probably in retaliation for Iran's role in the Syria conflict, militants detonated bombs outside Iran's embassy in Beirut on November 19, 2013, killing 25 persons including Iran's cultural attache to Lebanon.

Syria

Syria's Bashar Al Assad has been Iran's closest Arab ally, and Iran would suffer a considerable strategic setback if the Sunni-led rebellion succeeds in toppling his regime. Syria has been the main transit point for Iranian weapons shipments to Hezbollah, and both Iran and Syria have used Hezbollah as leverage against Israel to try to achieve regional and territorial aims. Rouhani has not sought to slow Iranian support to Assad, and it is not clear he would be able to change Iran's overall policy were he to try to do so. Iran's support for the beleaguered Iraqi government as of June 2014 could be draining off Iranian resources that might otherwise go to Assad.

U.S. officials and reports assert that, to try to prevent Assad's downfall, Iran is providing substantial amounts of material support to the Syrian regime, including funds, weapons, and fighters. (57) The State Department has said repeatedly that Iran has sent Qods Forces (QF) to Syria to advise the regime and fight alongside the Syrian military. Some experts say the Iranian direct intervention goes beyond QF personnel to include an unknown number of IRGC ground forces as well. (58) The Iranian advisers also have helped Syria set up militia forces to ease the burden on the Syrian army. In May 2014, there were press reports that Iran was attempting to recruit Afghan refugees in Iran to fight in Syria.

Iran has not denied assisting Syria; on December 11, 2013 and on several occasions since, IRGC leaders including Commander-in-Chief Jafari have said the IRGC has sent military experts to Syria. Iran bases its justification for its intervention in Syria on a long-standing defense relationship with the Assad regime. On December 13, 2009, the Syrian and Iranian defense ministers signed a defense agreement. In June 2010, it was reported that Iran had sent Syria a sophisticated air defense radar system that could potentially down Israeli aircraft. (59) On some occasions, including the early 1990s, Iran purportedly has acted as an intermediary with North Korea to supply Syria with various forms of WMD and missile technology, and Iran reportedly has helped Syria expand its chemical weapons arsenal. (60)

In large part to build on the nuclear diplomacy with Iran, the Obama Administration has entertained a possible role for Iran in finding a political solution in Syria, despite Iran's role in helping Assad militarily. U.N. Secretary General Ban Ki Moon invited Iran to the January 22, 2014, "Geneva 2" conference that is attempting to find a political solution to the Syria conflict conference after Iran reportedly privately assured him its supports efforts to form a transition government in Syria. However, Iran refused to state that position publicly and the United Nations rescinded Iran's invitation to the conference. In December 2012, Iran announced a six-point plan for a peaceful transition that would culminate in free, multiparty elections, although the plan was rejected by Syrian rebels because it provided for Assad to be able to compete in 2014 elections.

The Caucasus and Central Asia

Iran's policy in the nearby Caucuses has thus far emphasized Iran's rights to Caspian Sea resources, particularly against Azerbaijan. Azerbaijan is, like Iran, mostly Shiite Muslim-inhabited, but Azerbaijan is ethnically Turkic and its leadership is secular. Iran reportedly fears not only Azerbaijan's alignment with the United States, but also that Azerbaijan nationalists might stoke separatism among Iran's large Azeri Turkic population, which has sometimes been restive. These differences could explain why Iran has generally tilted toward Armenia, which is Christian, in Armenia's disputes with Azerbaijan. Iran has often slowed or stopped Azerbaijani truck traffic that must transit Iran in order to reach a non-contiguous part of Azerbaijan (Nakichevan), which is cut off from the rest of Azerbaijan by Armenia's occupation of Nagorno-Karabakh. In May 2012, Azerbaijan refused entry to a senior aide to Khamene'i.

The United States successfully backed construction of the Baku-Tblisi-Ceyhan oil pipeline, intended in part to provide alternatives to Iranian oil. In July 2001, Iranian warships and combat aircraft threatened a British Petroleum (BP) ship on contract to Azerbaijan out of an area of the Caspian that Iran considers its own. The United States called that action provocative. Israel also is apparently looking to Azerbaijan to counter Iran, announcing in February 2012 a major sale of defense equipment. In mid-March 2012, Azerbaijan arrested 22 persons it said were Iranian agents plotting attacks against Israeli and Western targets there.

Iran has generally sought and maintained good relations with the Central Asian states. Along with India and Pakistan, Iran has been given observer status at the Central Asian security grouping called the Shanghai Cooperation Organization (SCO--Russia, China, Kazakhstan, Kyrgyzstan, Uzbekistan, and Tajikistan). In April 2008, Iran applied for full membership in the organization, but, not wanting to antagonize the United States, in June 2010 the SCO barred admission to countries under U.N. Security Council sanctions (which is the case for Iran). (61)

South and East Asia

Iran looks to countries in East and South Asia as potential allies to help parry U.S. and European pressure on Iran's economy and its leaders. This section focuses primarily on South Asia, which is in Iran's immediate neighborhood.

East Asia

Many countries in East Asia are aligned with the United States. China is an emerging world power that opposes a nuclear-armed Iran but also questions unilateral U.S. sanctions against Iran. North Korea and Iran have cooperated on weapons-related technology, particularly ballistic missiles. In April 2013, press reports indicated Iran might supply oil to North Korea, presumably in exchange for the technological help, but it is not clear that this deal ever materialized. For more information on Iran's relations with East Asia, see CRS Report RS20871, Iran Sanctions, by Kenneth Katzman, which focuses on Iran's oil customers such as China.

South Asia: Afghanistan

In Afghanistan, Iran is apparently pursuing a multi-track strategy by helping develop Afghanistan economically, engaging the central government, and supporting pro-Iranian groups and anti-U.S. militants. A long-term Iranian goal appears to be to restore some of its traditional sway in eastern, central, and northern Afghanistan, where "Dari"-speaking (Dari is akin to Persian) supporters of the "Northern Alliance" grouping of non-Pashtun Afghan minorities predominate. Iran has also sought to use its influence in Afghanistan to try to blunt the effects of international sanctions against Iran. (62)

Iran has sought some influence by supporting the Afghan government. Outgoing President Hamid Karzai, who is a Sunni Muslim and a Pashtun, has repeatedly and publicly opposed any competition between the United States and Iran in Afghanistan. Karzai regularly meets with Iranian leaders bilaterally as well as in the context of several regional summit series that include Pakistan and Central Asian states. The two countries are said to be cooperating effectively against narcotics trafficking from Afghanistan into Iran; Iranian border forces take consistent heavy losses in operations to try to prevent this trafficking.

Reflecting concern about the U.S. military presence in Afghanistan, Iran reportedly tried to derail the U.S.-Afghanistan Strategic Partnership Agreement that was signed on May 1, 2012, and it is attempting to derail the Bilateral Security Agreement that has been completed by not signed by Karzai to date. The BSA text prohibits the United States from using Afghanistan as a base from which to launch military action against other countries. During a visit by Karzai to Tehran to meet with the new leadership team of Rouhani on December 7, 2013, the two presidents agreed to start negotiating a "pact of friendship." U.S. officials say the pact, even if signed, would not affect U.S. post-2014 plans in Afghanistan. Iran has not shied away from using financial resources to try to sway the Afghan leadership; in the past, Iran has given about $2 million per year in direct payments to Karzai's government. Karzai admitted on October 26, 2010, that Iran was providing cash payments to his government, through his chief of staff.

Even though it engages the Afghan government, Tehran has sought leverage against U.S. forces in Afghanistan. The State Department has reported on Iranian materiel support to militants in Afghanistan in its annual reports on terrorism, including citing the Qods Force for supplying various munitions, including 107 mm rockets, to select Taliban and other militants in Afghanistan, and of training Taliban fighters in small unit tactics, small arms use, explosives, and indirect weapons fire. The State Department reports assert that Iran has supplied militants in Qandahar, which is a Pashtun-inhabited province in southern Afghanistan and demonstrates that Iran is not only assisting militants near its borders. In February 2011, British forces captured 48 Iranian-made rockets in Afghanistan's western province of Nimruz, allegedly bound for Taliban militants. On the other hand, U.S. commanders have consistently maintained that the Iranian assistance to Afghan militants is not decisive on the battlefield.

The support Iran gives to Afghan insurgents gives Iran potential leverage in any Taliban-government political settlement in Afghanistan. In July 2012, Iran reportedly allowed the Taliban to open an office in Zahedan, in eastern Iran--possibly to better coordinate policy with the Taliban or possibly to facilitate and Iranian role in political reconciliation in Afghanistan. (63)

Iran has, with U.S. acceptance, engaged in some of the international diplomacy on Afghanistan. It attended the October 18, 2010, meeting in Rome of the 44-nation "International Contact Group" on Afghanistan. The United States did not object to the Iranian attendance at the meeting, which included a briefing by General David Petraeus (then top U.S./NATO commander in Afghanistan). Iran did not attend the January 28, 2010, international meeting in Britain on Afghanistan, but it did attend a follow-up meeting in Kabul on July 20, 2010. It also attended the major international Bonn Conference on Afghanistan on December 5, 2011, and subsequent international conferences on that issue.

Pakistan

Iran's relations with Pakistan have been partly a function of events in Afghanistan, although relations have occasionally been tense over the activities of Sunni Muslim militant groups operating on both sides of their border. These Sunni guerrillas from groups such as Jundullah and one called Jaysh al-Adl operate from Pakistan and have conducted a number of attacks on Iranian regime targets. Jaysh al-Adl seized five Iranian border guards in February 2014; one reportedly was killed and the other four were returned to Iran in April 2014.

Iran engaged in substantial military cooperation with Pakistan in the early 1990s, and it was revealed in 2003 that the founder of Pakistan's nuclear weapons program, A. Q. Khan, sold Iran nuclear technology and designs. (64) However, that cooperation waned later in the 1990s as Pakistan supported the Taliban in Afghanistan, which committed alleged atrocities against Shiite Afghans (Hazara tribe), and which seized control of Persian-speaking areas of western and northern Afghanistan. Iran remains suspicious that Pakistan might want to again implant Taliban militants in power in Afghanistan, but Iran-Pakistan relations have improved since mid-2011 as Pakistan's relations with the United States have worsened. Iran and Pakistan now have a broad bilateral agenda that includes a potential major gas pipeline project that Pakistan hopes can alleviate its energy shortages. Then president of Iran Ahmadinejad and Pakistan's then President Asif Ali Zardari formally inaugurated the project in March 2013. Iran has completed the line on its side of the border, but Pakistan reportedly has had trouble financing the project on its side of the border. U.S. officials say they consider it potentially sanctionable under the Iran Sanctions Act. Iran and Pakistan conducted joint naval exercises in early April 2014.

India

India and Iran have overlapping histories, civilizations, and interests, aligning on numerous issues including Afghanistan. Both countries support the minority factions based in the north and west. As international sanctions increased in 2011-2012, India wrestled with a choice of preserving its ties to Iran--which has provided it with needed oil for its growing economy--or joining U.S. and international attempts to isolate Iran. Since 2012, it has generally sided with the United States and the EU by cutting its purchases of Iranian oil, and has received exemptions from U.S. sanctions. However, India wants to preserve ties to Iran in support of India's own strategic interests; after the JPA was reached, Indian officials announced they would move forward on the development of Iran's Chabahar port, which would give India direct access to Afghanistan and Central Asia without relying on transit routes through Pakistan. International sanctions have delayed that project to date. For detail on India's cooperation with sanctions, see CRS Report RS20871, Iran Sanctions.

Of concern to some U.S. officials in the late 1990s were India-Iran military-to-military ties. The relationship included visits to India by some Iranian naval personnel, although India said these exchanges involve junior personnel and focus mainly on promoting interpersonal relations and not on India's provision to Iran of military expertise. The military relationship between the countries has withered over at least the past five years. India and Iran, along with the United States, backed the anti-Taliban "Northern Alliance" in Afghanistan during 1996-2001.

Al Qaeda

Iran is not a natural ally of Al Qaeda, largely because Al Qaeda is an orthodox Sunni Muslim organization. However, some experts believe that hardliners in Iran still might want to use Al Qaeda activists as leverage against the United States and its allies, despite the May 1, 2011, death of Al Qaeda founder Osama bin Laden in a U.S. raid in Pakistan. Some allege that Iran is forging links to Al Qaeda affiliates in Africa for the purpose of extending its influence there. However, it is unclear whether any Iranian ties to these groups are approved at the highest levels of the Iranian leadership. On April 22, 2013, Canada asserted it had foiled a plot by Al Qaeda members based in Iran to bomb Amtrak trains running between Canada and the United States. Officials who revealed the alleged plot did not assert that the Iranian government was involved.

Three major Al Qaeda figures who have been in Iran since the September 11, 2001, attacks include spokesman Sulayman Abu Ghaith, top operative Sayf Al Adl, and a bin Laden son, Saad. (65) U.S. officials blamed the three for the May 12, 2003, bombings in Riyadh, Saudi Arabia, against four expatriate housing complexes, saying they were able to contact associates outside Iran. (66) As a possible sign of an Iranian shift, Abu Ghaith was expelled to Turkey, and was apprehended by U.S. authorities on March 13, 2013, with the help of Turkey and Jordan while on his way to his native Kuwait. In February 2014, it was reported that another senior Al Qaeda figure, Thirwat Shihata, was expelled by Iran. (67)

Earlier, the Department of Treasury, on January 16, 2009, designated four Al Qaeda operatives in Iran, including Saad bin Laden (and three lesser known figures) as terrorist entities under Executive Order 13224. On July 28, 2011, under that same order, the Treasury Department sanctioned six Al Qaeda members for allegedly moving funds to Al Qaeda in Pakistan and Afghanistan via their bases in Iran, and under a specific agreement between Al Qaeda and Iran. Another bin Laden ally, Abu Musab al-Zarqawi, killed by U.S. forces in Iraq on June 7, 2006, reportedly transited Iran into Iraq after the September 11, 2001, attacks and became an insurgent leader in Iraq.

Iran has, to some extent, confirmed the presence of Al Qaeda militants in Iran. It asserted on July 23, 2003, that it had "in custody" senior Al Qaeda figures. On July 16, 2005, Iran's intelligence minister said that 200 Al Qaeda members are in Iranian jails. (68) U.S. officials have said since January 2002 that Iran has not prosecuted or extradited any senior Al Qaeda operatives.

The 9/11 Commission report said several of the September 11 hijackers and other plotters, possibly with official help, might have transited Iran, but the report did not assert that the Iranian government knew about the plot. A U.S. district court filing in May 2011 in New York named Iranian officials and ministries as materially supporting the Al Qaeda in the September 11 attacks. On December 15, 2011, the court in favor of the plaintiffs and later ordered Iran, Al Qaeda, and the Taliban to pay $6 billion in damages to the relatives of the September 11 attacks. Earlier, on November 28, 2011, a U.S. district court issued a ruling linking Iran (and Sudan) to the August 1998 Al Qaeda bombings of the U.S. embassies in Kenya and Tanzania.

Latin America

Some U.S. officials and some in Congress have sought to scrutinize Iran's relations with countries and leaders in Latin America. Iran views

some left-leaning and anti-U.S. leaning countries in Latin American as sharing its distrust of the United States and as willing to help Iran circumvent some international sanctions. However, Rouhani has not expressed substantial interest in expanding ties in Latin America, in sharp contrast to Ahmadinejad, who visited the region six times as President. Iran has developed exchange programs that bring students from Latin America to study Islam in Iran; it does not appear that these programs are intended to build terrorist or other pro-Iranian operational cells. (69)

During 2006-2011, when Ahmadinejad was president, Iran opened six embassies in countries in the region (Colombia, Nicaragua, Chile, Ecuador, Uruguay, and Bolivia), and expanded embassies in Cuba, Argentina, Brazil, Mexico, and Venezuela. In Ahmadinejad's visits to the region, some economic agreements were reached but few were implemented, by all accounts. Ahmadinejad attended the U.N. Conference on Sustainable Development in Brazil on June 21, 2012, which was bounded by his travel to Bolivia and Venezuela.

In the 112th Congress, H.R. 3783, the "Countering Iran in the Western Hemisphere Act," requiring the Administration to develop within 180 days of enactment a strategy to counter Iran's influence in Latin America, passed both chambers and was signed on December 28, 2012 (P.L. 112-220). The Administration report required by that law was provided to Congress in late June 2013; the unclassified portion asserted that "Iranian influence in Latin America and the Caribbean is waning" in part because of U.S. efforts to cause Latin American countries to assess the costs and benefits of closer relations with Iran. (70) No Latin American leader attended the NAM summit in Tehran in August 2012.

Venezuela. Iran, then under Ahmadinejad's presidency, had particularly close relations with Venezuela during the presidency of Hugo Chavez, who passed away in March 2013. Chavez's hand-picked successor, Nicolas Maduro, was declared the winner of the April 2013 presidential election, but Maduro has not expressed nearly the enthusiasm for the Iran relationship that Chavez did. Even before Chavez's death on March 5, 2013, there was no U.S. consensus on the degree of threat posed by Iran-Venezuela ties; in July 2012, President Obama stated that Iran-Venezuela ties do not constitute a strategic threat to the United States.

Indications differ over how active is Iran's presence in Venezuela. An April 2010 Defense Department report on Iran was the first U.S. government publication to say that Qods Force personnel were in Venezuela, although the 2012 version of the report did not address that issue. However, a State Department official testified before the House Foreign Affairs Committee on June 24, 2011, that Iran's embassy in Caracas has only about 14 diplomats and is not particularly active in terms of open diplomatic activity. About 400 Iranian engineers reportedly were sent to Venezuela to work on infrastructure projects there. Many accounts say that most of the economic agreements between Iran and Venezuela were not implemented. The arrangements that were implemented included the establishment of direct air links through an obscure air service, although the route was suspended in 2010. A deal for Petroleos de Venezuela to supply Iran with gasoline was signed in September 2009, apparently in a joint effort to circumvent U.S. sanctions on sales of gasoline to Iran. In part because of this trade, the firm was sanctioned under the Iran Sanctions Act in May 2011. Other Venezuelan firms have also been sanctioned for ties to Iran, as discussed in CRS Report RS20871, Iran Sanctions.

As far as military cooperation, it was reported in May 2011 that the two may have signed an agreement in October 2010 to develop a joint missile base in Venezuela. However, the Obama Administration said there was no evidence to support the missile base assertion. Venezuela reportedly has purchased some Iranian military equipment, such as rifles, as well as $23 million in military equipment upgrades and an explosives factory. (71)

Cuba. Iran's relations with Cuba are long-standing and Cuba was routinely included in then president Ahmadinejad's several visits to Latin America. In the past, Cuba reportedly has helped Iran jam the broadcasts of Iranian dissidents based in Los Angeles and elsewhere in the United States. Still, Cuba's economy is widely considered too small to be able to materially reduce the effect of international sanctions against Iran.

Nicaragua. Iran's embassy in Managua, Nicaragua, is said by close observers to be small, and Nicaragua has refused Iranian demands to repay $164 million in debt it owes Iran for past crude oil deliveries. Nicaragua reportedly was upset that Ahmadinejad's January 2012 visit did not result in an Iranian pledge to forgive that debt. Iran also failed to implement some promises to undertake joint ventures with Nicaragua, including a $350 million deep water port there. Still, President Daniel Ortega hosted Ahmadinejad during his visit there in January 2012.

Argentina. Iran's relations with Argentina have been strained since the 1992 bombing of the Israeli embassy in Buenos Aires, which was followed by the 1994 bombing of a Jewish community center there. Both events were widely blamed by investigators and others on Iran, working through its close ally Hezbollah. Then-Iranian Defense Minister Ahmad Vahidi visited Bolivia in May 2011, but President Evo Morales was compelled to apologize to Argentina for inviting him because of Vahidi's alleged involvement in the 1994 Buenos Aires bombing. Vahidi was, at the time of the bombing, the head of the Qods Force. Some in the Jewish community have opposed a January 2013 Iran-Argentina memorandum of understanding to investigate the 1994 bombing by forming a "truth commission," rather than to aggressively prosecute the Iranians involved. In May 2013, the Argentine prosecutor in the AMIA bombing case, Alberto Nisman, issued a 500-page report alleging that Iran has been working for decades in Latin America, setting up intelligence stations in the region by utilizing embassies, cultural organizations, and even mosques as a source of recruitment.

Brazil. Because of its large economy, Brazil, under previous President Luiz Inacio Lula da Silva, emerged as Iran's most significant supporter, particularly because of Brazil's engagement with Iran to forge the "Tehran Declaration" on nuclear issues in June 2010. However, the government of President Dilma Roussef, whose term began January 1, 2011, has been less supportive of Iran than was her predecessor. Ahmadinejad did not visit Brazil during his January 2012 visit to the region, but he did visit in June 2012 to attend the U.N. Conference on Sustainable Development.

Africa

Former President Ahmadinejad tried to enlist the support of some African leaders to reduce Iran's international isolation. Ahmadinejad's outreach focused on those African countries that might be able to export natural uranium for Iran's nuclear program to compensate for Iran's domestic deficiencies; such uranium producers include Zimbabwe, Niger, Senegal, Nigeria, and the Democratic Republic of Congo. He made five visits to Africa during his presidency, the most recent of which was to Niger, Benin, and Ghana in April 2013. However, the visits produced no major agreements, by most accounts, in part because most African countries do not want to risk their relationships with the United States by undertaking new dealings with Iran. And, some countries in Africa complain that Iran has not implemented some of its pledges: an Iranian promise to build a new oil refinery in Senegal to ease that country's gasoline shortages was not implemented. Rouhani is likely to concentrate on Iran's relationships with the larger and wealthier countries and likely de-emphasize Africa relative to the policies of Ahmadinejad.

The State Department report on terrorism for 2013 states that Iran "has increased its presence in Africa," but without providing additional detail. In October 2010, according to Senegalese government sources, the IRGC-QF reportedly attempted to ship weapons to Gambia, via Nigeria, but the shipment was intercepted in Nigeria. Several Iranian entities, and a Nigerian shipping agent, were sanctioned by the United States in April 2012 for facilitating this incident. The Nigerian shipping agent allegedly helped Qods Force personnel enter Nigeria. On May 13, 2013, a Nigerian court convicted one alleged QF member and his Nigerian accomplice to five years in prison for the shipment. The U.N. panel of experts report on Iranian arms sales embargo violations, discussed above, have cited Iranian attempts to ship weapons to allies in the Middle East via Nigeria. Iran restored relations with Senegal on February 7, 2013; relations had been severed in February 2011 when Senegal accused Iran of supplying weapons to rebels in its southern Casamance region. (For more information, see CRS Report RS20871, Iran Sanctions, by Kenneth Katzman.)

Some Members of Congress are concerned that Iran is supporting radical Islamist movements or planning acts of terrorism in Africa. Allegations of Iran's support for Al Qaeda affiliates in Africa are discussed above in the section on Al Qaeda. A Kenyan court found two Iranian men guilty on May 2, 2013, of planning to carry out bombings in Kenya, apparently against Israeli targets there. As noted above, the U.N. panel of experts reportedly concluded in early 2014 that Iranian arms had reached Al Shabab in Somalia. However, such activity appears to be a minor component of Iranian policy and it is not clear that Iran seeks a broad relationship with Al Shabab.

Sudan

Perhaps Iran's closest relationship in Africa is with the government of Sudan, which, like Iran, is identified by the United States as a state sponsor of terrorism. Iran's relations with Sudan give Iran leverage against Egypt and a channel to supply weapons to Hamas and pro-Iranian movements in north and east Africa. (72) Independent experts have documented Iranian defense transfers to Sudan, which are not voluntarily reported to the United Nations. (73) There is periodic media speculation, and accusations from Israel, that links Iran to alleged weapons shipments through Sudan bound for Gaza. (74) In October 2012, a weapons factory in Khartoum, purportedly a source of Iranian weapons supplies for Hamas, was bombed, apparently by Israel.

Iran's relations with Sudan were particularly close in the early 1990s when Islamist leaders in Sudan welcomed international Islamist movements to train and organize there, but outwardly cooled in the mid-1990s when international sanctions on Sudan compelled that country to downplay Islamist links abroad. Iran nonetheless continued to supply the Sudanese government with weapons it has used on its various fronts, such as the one with South Sudan, and the QF reportedly has armed and trained Sudanese forces including the Popular Defense Force militia. (75) Some observers say Iranian pilots have assisted Sudan's air force there. Iran's naval forces made three visits to Port Sudan since 2012, and Iran has offered to build missile defense platforms in Sudan that would help stop further Israeli attacks. Sudan's Foreign Minister Ali Ahmed Karti stated in November 2013 that Sudan had rejected the offer, possibly to avoid alarming the Persian Gulf states who view Khartoum's relations with Sudan with suspicion.

U.S. Policy Approaches and Additional Options

The February 11, 1979, fall of the Shah of Iran, a key U.S. ally, opened a deep and ongoing rift in U.S.-Iranian relations. The Islamic revolution in Iran occurred at the start of the third year of the Carter Administration. That Administration initially sought a degree of engagement with the Islamic regime, but it agreed to allow the ex-Shah into the United States for medical treatment and engaged some moderate Iranian officials of the new regime who were viewed by Khomeini loyalists as insufficiently revolutionary. As a result, the U.S.-Iran estrangement deepened significantly began on November 4, 1979, when radical pro-Khomeini "students in the line of the Imam (Khomeini)" seized the U.S. Embassy in Tehran and held its diplomats hostage until minutes after President Reagan's inauguration on January 20, 1981. That anniversary is remembered each year in Iran with large government-orchestrated anti-U.S. demonstrations near the former U.S. embassy in Tehran. That embassy is now used as a museum commemorating the revolution and as a Basij headquarters. The United States broke relations with Iran on April 7, 1980, two weeks prior to the failed U.S. military attempt to rescue the hostages during April 2425, 1980. Until 2013, the two countries had limited contact after that time.

Reagan Administration. Iran was placed on the U.S. "terrorism list" in 1984, a designation that reinforces the U.S "tilt" toward Iraq in the 1980-1988 Iran-Iraq War. As part of the effort to bolster Iraq in that war, U.S. diplomacy attempted to block conventional arms sales to Iran and the United States provided battlefield intelligence to Iraq. (76) During 1987-1988, U.S. naval forces engaged in several skirmishes with Iranian naval elements in the course of U.S. efforts to protect international oil shipments in the Gulf from Iranian mines and other attacks. On April 18, 1988 ("Operation Praying Mantis"), Iran lost one-quarter of its larger naval ships in an engagement with the U.S. Navy, including a frigate sunk. On July 3, 1988, U.S. forces in the Gulf mistakenly shot down Iran Air Flight 655 by the USS Vincennes over the Gulf.

George H. W Bush Administration. After the Iran-Iraq War ended, President George H. W. Bush laid the groundwork for a rapprochement with Iran. In his January 1989 inaugural speech, saying that, in relations with Iran, "goodwill begets goodwill," implying better relations if Iran helped obtain the release of U.S. hostages held by Hezbollah in Lebanon. Iran did assist in obtaining their release, completed in December 1991. However, no thaw followed, possibly because Iran continued to back groups opposed to the U.S.-sponsored Middle East peace process.

Clinton Administration. Upon taking office in 1993, the Clinton Administration at first adopted a strategy of "dual containment" of Iran and Iraq. In 1995 and 1996, the Clinton Administration and Congress banned U.S. trade and investment with Iran and imposed penalties on investment in Iran's energy sector (Iran Sanctions Act) in response to growing concerns about Iran's weapons of mass destruction and its efforts to subvert the Arab-Israeli peace process. The Clinton Administration expressed skepticism of the EU's policy of "critical dialogue" with Iran--a dialogue consisting of EU meetings with Iran that included criticisms of Iran's human rights policies and its support for militant movements in the Middle East.

The election of relative moderate Mohammad Khatemi in May 1997 precipitated a U.S. offer of direct dialogue with Iran without preconditions. In January 1998, Khatemi publicly agreed to "people-to-people" U.S.-Iran exchanges, but ruled out direct talks. In a June 1998 speech, then-Secretary of State Albright called for mutual confidence building measures that could lead to a "road map" for normalization. In a March 17, 2000, speech, she acknowledged past U.S. meddling in Iran, announcing an easing of the U.S. trade ban, and promised to try to resolve outstanding claims disputes. At the September 2000 U.N. "Millennium Summit" in New York, Albright and President Clinton attended Khatemi's speeches.

George W. Bush Administration. Although Iran's government apparently had no direct role in the September 11, 2001, attacks, President George W. Bush defined Iran as an adversary of the United States when he included Iran as part of an "axis of evil" (along with Iraq and North Korea) in his January 2002 State of the Union message. Later that year, Iran's nuclear program emerged as a major issue for U.S. policy toward Iran. President Bush's January 20, 2005, second inaugural address and his January 31, 2006, State of the Union message stated that the United States would be a close ally of a free and democratic Iran--reflecting sentiment for changing Iran's regime. (77)

On the other hand, reflecting the views of those in the Administration who favored diplomacy, particularly on Iraq and Afghanistan. The Administration conducted a dialogue in Geneva with Iran on Iraq and Afghanistan from late 2001 until May 2003, (78) representing the first confirmed direct dialogue between the two countries since the 1979 revolution. The United States aided victims of the December 2003 earthquake in Bam, Iran. An amendment by then Senator Joseph Biden to the FY2007 defense authorization bill (P.L. 109-364) supported the Administration joining the European countries' nuclear talks with Iran.

The Bush Administration did not offer Iran an unconditional, direct U.S.-Iran bilateral dialogue on all issues of U.S. concern. Some assert that the Bush Administration missed an opportunity for a "grand bargain" with Iran on its nuclear program and other issues of concern by rebuffing a reported comprehensive overture from Iran just before the May 12, 2003, Riyadh bombing. The Washington Post reported on February 14, 2007, ("2003 Memo Says Iranian Leaders Backed Talks") that the Swiss ambassador to Iran in 2003, Tim Guldimann, had informed U.S. officials of a comprehensive Iranian proposal for talks with the United States. (79) However, State Department and some European diplomats dispute that the proposal was fully vetted within Iran's leadership.

Obama Administration Policy: Pressure Coupled with Engagement

After taking office in 2009, President Obama asserted that there was an opportunity to diplomatically persuade Iran to limit its nuclear program and to build a new relationship after decades of estrangement and enmity. Some Obama Administration officials expressed skepticism that engagement would yield changes in Iran's policies, while other officials believed that the United States needed to present Iran with clear choices if it continues to expand its nuclear program. Obama Administration Iran policy unfolded in President Obama's first message to the Iranian people on the occasion of Nowruz (Persian New Year) on March 21, 2009. He stated that the United States "is now committed to diplomacy that addresses the full range of issues before us, and to pursuing constructive ties among the United States, Iran, and the international community." He also referred to Iran as "The Islamic Republic of Iran," a formulation suggesting aversion to regime change. Other steps included the following.

* President Obama's reported two letters in 2009 to Iran's Supreme Leader expressing the Administration's philosophy in favor of engagement with Iran.

* A major speech to the "Muslim World" in Cairo on June 4, 2009, in which President Obama acknowledged that the United States had played a role in the overthrow of Mossadeq, and said that Iran had a right to peaceful nuclear power if it complies with its responsibilities under the NPT.

* An announcement on April 8, 2009, that U.S. officials would attend all P5+1 meetings with Iran, and a loosening of restrictions on U.S. diplomats to meet their Iranian counterparts at international meetings.

2009-2013: Emphasis on Pressure

At the end of 2009, Iran's crackdown on the 2009 election-related unrest and its refusal to finalize the October 1, 2009, interim nuclear agreement discussed above caused the Administration to shift to a "two track strategy:" economic pressure coupled with nuclear negotiations and offers of sanctions relief in return for a compromise. The sanctions imposed during the period, and the degree of international cooperation with the sanctions engendered, were substantial--reflecting the emphasis in the U.S. strategy on pressure. The sanctions imposed are discussed in detail in CRS Report RS20871, Iran Sanctions. The Administration also criticized Iran's human rights abuses, altered some sanctions regulations to help Iranians circumvent government restrictions on the Internet, and continued to fund training and exchanges with civil society activists in Iran. The Administration repeatedly stated that a military option "remains on the table" and it continued to work with the Persian Gulf states and other regional allies to contain Iranian missile and other capabilities.

Response to Rouhani

The election of Hassan Rouhani was judged by the Administration as providing an opportunity for a shift in policy from emphasis on economic pressure to emphasis on diplomacy. The Administration reacted to the election by reiterating the offer stated by Vice President Biden in February 2013, to engage in direct talks with Iran on the nuclear issue. A letter signed by 131 House Members to President Obama, dated July 19, 2013, stated that it would be "prudent for the United States to utilize all diplomatic tools to reinvigorate ongoing nuclear talks."

The potential for rapprochement seemed to improve as the U.N. General Assembly meetings in New York approached. On September 20, 2013, the Washington Post published an op-ed by Rouhani, entitled "Time to Engage," stating a commitment to "fulfilling my promises to my people, including my pledge to engage in constructive interaction with the world." President Obama, in his September 24, 2013, speech, confirmed that he had exchanged letters with Rouhani stating the U.S. willingness to resolve the nuclear issue peacefully. (80) President Obama's speech also appeared intended, in part, to assuage the Supreme Leader's reported concerns, by stating "We are not seeking regime change." He also reiterated that the United States "respect[s] the right of the Iranian people to access peaceful nuclear energy."

September 2013 Phone Conversation. The Administration signaled that the President would be open to meeting Rouhani on September 24, 2013, between their respective speeches to the General Assembly. That meeting did not occur; Rouhani attributed the failure to meet to inadequate time to prepare for a meeting, although experts attributed it to Rouhani's need to avoid angering hardline regime elements in Iran. President Obama called Rouhani by phone on September 27, 2013, representing the first direct contact between presidents of the two countries since the 1979 Islamic revolution. The two presidents reportedly agreed to direct their teams to focus on a nuclear solution.

After the U.N. meetings, the Administration focused on the nuclear talks in Geneva, which reached agreement on the JPA and continued with the negotiations on a comprehensive nuclear settlement. The Administration has said that there will be no linkage between a comprehensive deal and Iranian cooperation on such other issues as Iraq, Syria, or Iran's human rights record. Still, the negotiations have improved the climate for broadening U.S.-Iran talks, and the United States and Iranian officials met bilaterally on the Iraq issue at the margins of the nuclear talks in June 2014. There is speculation among experts that President Obama and Rouhani might meet, perhaps briefly, during the U.N. General Assembly meetings in New York in September 2014 in an attempt to overcome obstacles to a comprehensive nuclear settlement.

Containment and Military Options: U.S. Posture in the Gulf

Some take the view that Iran will inevitably become a nuclear armed state and that containing a nuclear armed Iran is a more feasible and effective option than any other. Experts who support containment argue that the strategy can also limit Iran's political and military influence more broadly, even if there is a nuclear settlement. Critics of containment see any formal adoption of that strategy as an abandonment of U.S. efforts to prevent Iran from becoming a nuclear state. All senior Obama Administration officials, including President Obama, have explicitly asserted that U.S. policy is to prevent Iran from becoming a nuclear state. S.J.Res. 41, which passed the Senate on September 22, 2012, in the 112th Congress, rejects any U.S. policy that relies on containment but acknowledges that President Obama has ruled out a containment policy.

There is no consensus on the parameters of a containment strategy. Many argue that such a policy would consist of isolating Iran to the extent possible through sanctions and diplomacy, as well as through the threat of U.S. military action to prevent Iranian aggression. A key component of a containment policy is for the United States to maintain a significant defense capability in the Gulf and to enhance the capabilities and resolve of U.S. allies there. The Obama Administration has continued to implement both of these policy components, as discussed below.

Military Action: Pros and Cons

A significant U.S. defense posture can be used not only for containment, but to implement any U.S. decision to take military action to stop Iran's nuclear progress. President Obama has repeatedly stated that "all options are on the table" to prevent Iran from acquiring a nuclear weapon. In a March 2, 2012, interview in The Atlantic, President Obama clarified that the "military option" as meaning that there is a military component to preventing a nuclear-armed Iran. (81) He has repeated the "all options on the table" formulation even after the JPA was agreed, indicating that such an option is open should the JPA collapse or no permanent nuclear deal be reached. Yet, President Obama and other senior officials continued to maintain that military action is a last resort if sanctions and diplomacy fail.

Some argue that U.S. military action could set back Iran's nuclear program substantially because there are a limited number of key targets and all targets, even the hardened Fordow site, are vulnerable to U.S. air power. (82) Other experts suggest that U.S. expressions of confidence in its ability to do substantial damage to Iranian nuclear targets could be intended to signal to Israel that the United States can destroy Iran's nuclear infrastructure, if needed. A U.S. ground invasion to remove Iran's regime has not, at any time, appeared to be under serious consideration, in part because of the likely resistance an invasion would meet in Iran.

Senior U.S. officials have repeatedly stressed the potential adverse consequences of military action, such as Iranian retaliation that might expand throughout the region or even beyond, a reduction of Iran's regional isolation, a strengthening of Iran's regime domestically, an escalation of world oil prices, and the likelihood that military action would only delay Iran's eventual acquisition of a nuclear weapons capability by about one to two years. (83) Most U.S. allies oppose military action, and some allied countries and experts warn that U.S.-Iran military conflict could result from events or actions other than a deliberate U.S. strike. For example, Iran threatened repeatedly in 2012 to close the Strait of Hormuz if sanctions are imposed on Iran's exportation of oil. This issue is discussed in detail in CRS Report R42335, Iran's Threat to the Strait of Hormuz, coordinated by Kenneth Katzman.

Some argue that there are U.S. military options that would not require hostilities. These options include a naval embargo or a "no-fly zone" over Iran to pressure the regime. These options appear to be under current consideration.

Presidential Authorities and Legislation on Military Action. A decision to take military action might raise the question of presidential authorities, but no legislation has been passed by both chambers and signed into law limiting the President's authority to use military force against Iran. In the 109th Congress, H.Con.Res. 391 (introduced on April 26, 2006) called on the President to not initiate military action against Iran without first obtaining authorization from Congress. A similar bill, H.Con.Res. 33, was introduced in the 110th Congress. An amendment to H.R. 1585, the National Defense Authorization Act for FY2008, requiring authorization for force against Iran, was defeated 136 to 288. A provision that sought to bar the Administration from taking military action against Iran without congressional authorization was taken out of an early draft of an FY2007 supplemental appropriation (H.R. 1591). Other provisions, including requiring briefings to Congress about military contingency planning related to Iran's nuclear program, were in the House version (H.R. 5658) of a FY2009 defense authorization bill, but not the final law. The FY2011 Defense Authorization Act (P.L. 111-383, signed January 7, 2011) contained a provision ([section]1243) requiring the Administration to develop a "National Military Strategy to Counter Iran."

In the 111th Congress, H.Con.Res. 94 called for the United States to negotiate an "Incidents at Sea" agreement with Iran. Section 1240 of the National Defense Authorization Act for FY2011 (P.L. 111-383) called for a DOD report, within one year of enactment, on the merits of such an agreement with Iran and other Persian Gulf countries. A press report in September 2011 said that some Defense Department officials were contemplating establishing formal communications channels to Iranian naval officers to prevent misunderstandings and unintended conflict. (84) The idea grew out of a series of incidents with Iranian vessels, some of the incidents involving British warships, that nearly prompted confrontation with Iran. The concept has not been implemented.

U.S. Deployments in the Persian Gulf

Whether or not U.S. military action against Iran is ordered, the United States maintains a large Persian Gulf presence as a demonstration that a military option can be implemented. During an early December 2013 visit to several Gulf states, Secretary of Defense Hagel stated that the United States maintains about 35,000 forces in the Gulf region. Most of them are stationed at various Gulf state facilities that the United States has access to, in accordance with Defense Cooperation Agreements (DCAs) between the United States and these countries. Some of the forces are aboard the at least one U.S. aircraft carrier task force that is in the Gulf region virtually continuously. The U.S. defense posture in the Gulf is as follows: (85)

* Saudi Arabia. The United States does not have a DCA with Saudi Arabia. Nonetheless, a few hundred U.S. military personnel are in Saudi Arabia training its military and Saudi Arabia National Guard (SANG) forces. During the 1990s, the United States emplaced forces and combat aircraft at such Saudi facilities as Prince Sultan Air Base, about 60 miles south of Riyadh.

* Kuwait. The United States has had a DCA with Kuwait since 1991, and about 13,000 U.S. Army personnel are stationed there, providing ground combat capability in the wake of the full U.S withdrawal from Iraq. The forces operate out of such facilities as Camp Arifjan, south of Kuwait City, where the United States prepositions ground armor including tanks. U.S. forces train at Camp Buehring, about 50 miles west of the capital, and operate in other facilities such as Shaykh Jabir Air Base.

* Qatar. The United States has had a DCA with Qatar since 1992; Secretary Hagel signed an updated version during his visit in December 2013. About 5,000 U.S. forces, mostly Air Force, are in Qatar, manning the forward headquarters of U.S. Central Command (CENTCOM), which has responsibility for the Middle East and Central Asia; a Combined Air Operations Center (CAOC) that oversees U.S. combat aircraft missions in the region; the large Al Udeid Air Base, and the As Saliyah army prepositioning site where U.S. tanks are prepositioned.

* UAE. The United States has had a DCA with UAE since 1994. About 5,000 U.S. forces, mostly Air Force and Navy, are stationed in UAE, operating surveillance and refueling aircraft from Al Dhafra Air Base, and servicing U.S. Navy and contract ships which dock at the large commercial port of Jebel Ali.

* Bahrain. The United States has had a DCA with Bahrain since 1991. About 6,000 U.S. personnel, mostly Navy, operate out of the large Naval Support Activity facility that houses the U.S. command structure for all U.S. naval operations in the Gulf. U.S. Air Force personnel also access Shaykh Isa Air Base.

* Oman. The United States has had a "facilities access agreement" (not a DCA) with Oman since April 1980. Under the agreement, U.S. forces, mostly Air Force, have access to Omani air bases such as those at Seeb, Masirah Island, Thumrait, and Musnanah. A few hundred U.S. forces serve at these facilities.

U.S. Efforts to Enhance Indigenous Gulf Defense Capabilities

The Obama Administration has continued, and in some ways expanded, prior initiatives to support the indigenous military capabilities of the GCC states. The Administration inaugurated a "U.S.-GCC Strategic Dialogue" in March 30-31, 2012. A cornerstone of the initiative, similar to that of forerunner efforts, is to coordinate Gulf state missile defense capabilities. Secretary of Defense Hagel emphasized the joint missile defense vision during his December 2013 and May 2014 visits to the Gulf, including stating that the United States prefers to sell related equipment to the GCC as a bloc, rather than individually. As part of this effort, there have been several recent missile defense sales include PAC-3 sales to UAE and Kuwait; and the advanced "THAAD" (Theater High Altitude Area Defense) to UAE and Qatar. In September 2012, it was reported that the United States was putting in place an early-warning missile defense radar in Qatar that, when combined with radars in Israel and Turkey, would provide a wide range of coverage against Iran's missile forces. (86)

Other major U.S. arms sales to the GCC countries have been intended to improve their air and naval capabilities and their interoperability with U.S. forces, as well as to improve border and maritime security. The United States has continued to agree to major sales to virtually all of the GCC states, including such equipment as combat aircraft, precision-guided munitions, Littoral Combat Ships, radar systems, and communications gear. Some arms sales to Bahrain have been withheld because of the government's use of force to suppress Shiite unrest there.

Some U.S. officials have at times raised the possibility of a more expansive U.S. security commitment to the Gulf states against Iran. In February 2010, then-Secretary of State Clinton raised the issue of a possible U.S. extension of a "security umbrella" or guarantee to regional states against Iran.

Other Missile Defense Concepts

As part of the effort to demonstrate to Iran that nuclear weapons have no utility, there has also been planning to defend against an eventual long-range Iranian missile system. In August 2008, the George W. Bush Administration reached agreements with Poland and the Czech Republic to establish a missile defense system to counter Iranian ballistic missiles. These agreements were reached over Russia's opposition, which was based on the belief that the missile defense system would be used to neutralize Russian capabilities. However, reportedly based on assessments of Iran's focus on missiles of regional range, on September 17, 2009, the Obama Administration reoriented this missile defense program to focus, at least initially, on ship-based systems, and systems based in other European countries, including Romania, possibly later returning to the idea of Poland- and Czech-based systems. Some saw this as an effort to win Russia's support for additional sanctions on Iran, although Russia continues to disagree with the plan. The FY2013 national defense authorization act (P.L. 112-239) contained provisions urging the Administration to undertake more extensive efforts, in cooperation with U.S. partners and others, to defend against the missile programs of Iran (and North Korea).

Iranian Retaliation Scenarios

Consistent with U.S. assessments, Iran's Supreme Leader and other Iranian political and military figures have repeatedly warned that Iran would retaliate for any U.S. or other military action taken against Iran. In September 2012, IRGC officials warned that even if military action were taken only by Israel, the action would trigger retaliation against U.S. targets. Some U.S. officials believe Iran would try to retaliate through terrorist attacks inside the United States or against U.S. embassies and facilities in Europe or the Persian Gulf. Iran could also try to direct anti-U.S. militias in Afghanistan to attack U.S. personnel there.

Were Iran to take retaliatory action against the United States and the GCC states, it would probably rely most heavily on its ships, submarines, and short range missiles. Iran could potentially use its large fleet of small boats to "swarm" U.S. ships, and its ability to lay numerous mines in the narrow Strait of Hormuz. Iran has added naval bases along its Gulf coast in recent years, enhancing its ability to threaten shipping in the Strait. In February 2013, Iran began planning an additional naval base near Iran's border with Pakistan, on the Sea of Oman.

To reduce the effectiveness of Iranian retaliation, some argue that the United States would need to strike not only nuclear facilities but all of the retaliatory capabilities discussed above. Press reports in February 2012, citing reported Defense Department briefings of President Obama on military options on Iran, said that a U.S. strike could include IRGC and Iranian leadership targets.

Potential for an Israeli Strike? (87)

Prime Minister Benjamin Netanyahu of Israel has asserted that a nuclear-armed Iran would constitute an existential threat to Israel, and that Israel would take unilateral action to prevent a nuclear-armed Iran. Israeli leaders have expressed concern that Iran's nuclear program was advancing to the point where Israel would no longer have a military option, and Netanyahu openly opposed the JPA as failing to dismantle Iran's nuclear infrastructure. The Obama Administration resisted the urgings of Netanyahu, in his September 27, 2012, U.N. General Assembly speech, to set clear "red lines"--actions by Iran that would trigger certain U.S. military action. On May 22, 2013, by a vote of 99-0, the Senate passed a "sense of Congress" resolution, S.Res. 65, that the United States should support Israel diplomatically, economically, and militarily if it felt compelled to strike Iran's nuclear facilities. Still, the JPA and the talks on a comprehensive nuclear agreement appear to preclude an Israeli military strike on Iran, at least in the short term.

Although Israeli strategists say that a strike might be a viable option, several U.S. experts doubt that Israel has the capability to make such action sufficiently effective to justify the risks. The IAF is capable but far smaller than that of the United States, and could require overflight of several countries not likely to support Israeli action, such as Iraq.

Reported Covert Action

There reportedly has also been U.S. covert action to slow Iran's nuclear program, but no apparent U.S. covert action to try to destabilize Iran politically. During 2006-2008, it was reported that the United States and Israel conducted operations that resulted in the sale to Iran of nuclear and other technology rigged to have a destructive effect on Iran's programs. Another example includes the Stuxnet computer virus that caused many Iranian centrifuges to be destroyed. The killings of some Iranian scientists over the past few years remain unexplained and could have been the result of covert action. Mostafa Ahmadi Roshan, a chemical engineer at the Natanz enrichment facility, died when a bomb placed under his car exploded on January 10, 2012.

Some believe that Iran is retaliating for the reported covert action through cyberattacks on U.S. or foreign financial institutions, which have been occurring since 2012. U.S. officials have said Iran might also have perpetrated a cyberattack against Persian Gulf state oil and gas firms in mid-2012. U.S. officials say they are working with affected institutions to try to stop the attacks, and some press reports say that other forms of retaliation against Iran might be under consideration. (88)

Regime Change

Even before the election of Rouhani, the Obama Administration has consistently sought to allay Iran's long-standing suspicions that the main U.S. goal is to unseat the Islamic regime in Iran. Since then, in a September 24, 2013, General Assembly speech, President Obama explicitly stated the United States does not seek to change Iran's regime. However, many of Iran's leaders, particularly Khamene'i, continue to articulate a perception that the United States has never accepted the 1979 Islamic revolution. Khamene'i and other Iranian figures note that the United States provided some funding to anti-regime groups, mainly pro-monarchists, during the 1980s, (89) and the George W. Bush Administration expressed attraction to this option on several occasions.

There was criticism in Iranian opposition and other circles of the Administration decision not to materially support the 2009 domestic uprising in Iran. The Administration asserts that it was appropriately critical of the regime crackdown on protests. On December 28, 2009, President Obama stated that "Along with all free nations, the United States stands with those who seek their universal rights." (90) On September 19, 2010, then-Secretary of State Clinton asserted that overt and extensive U.S. support for the opposition could undermine the opposition's position in Iran.

In 2011, the Administration reevaluated its stance slightly in the context of the broader Middle East uprisings. Statements by then-Secretary Clinton accused Iran of hypocrisy for supporting demonstrations in Egypt while preventing similar free expression inside Iran. (91) Many observers noted that President Obama's 2011 Nowruz address was far more explicitly supportive of the Iranian opposition than in past years, mentioning specific dissidents who have been jailed and saying to the "young people of Iran ... I want you to know that I am with you." (92) Since that statement, the Administration has sanctioned Iranian officials for human rights abuses in Iran and for assisting Syria with its crackdown against demonstrations. These statements and steps stop short of constituting a policy of "regime change," although Iran interprets any public support for the domestic opposition as evidence of U.S. intent to overthrow the clerical government.

Some in Congress have advocated a U.S. policy of overthrow of the regime. In the 111th Congress, one bill said that it should be U.S. policy to promote the overthrow of the regime (The Iran Democratic Transition Act, S. 3008).

Democracy Promotion and Internet Freedom Efforts

In the absence of all-out U.S. pursuit of regime change, successive Administrations and Congress have agreed on steps to promote gradual political evolution in Iran through "democracy promotion" and sanctions on Iranian human rights abuses. The laws and Executive Orders discussed in this section are analyzed in greater detail in CRS Report RS20871, Iran Sanctions. That report also contains tables listing Iranian entities sanctioned under these provisions.

Sanctioning Iranian Human Rights Abusers and Abuses

As part of its efforts to isolate the regime on human rights grounds, on September 29, 2010, President Obama, acting in accordance with Section 105 of P.L. 111-195 (CISADA), issued Executive Order 13553, imposing sanctions on Iranian officials determined to have committed human rights abuses since Iran's 2009 election. Sanctions include a ban on visas to the United States and freeze on U.S.-based assets or trade with them. In an annex, eight Iranian officials were named as violators and were subjected to the sanctions.

In the 112th Congress, several bills were introduced to increase sanctions on Iranian human rights abusers, including S. 879 and H.R. 1714. Elements of them were incorporated into a broad Iran sanctions bill, H.R. 1905, passed by both chambers on August 1, 2012, and signed on August 10 (P.L. 112-158), and expanded since.

Promoting Internet Freedom in Iran

U.S. actions have focused on preventing the Iranian government's suppression of electronic communication. Several laws and Executive Orders issued since 2010 are intended to promote Internet freedom, and the Administration has amended U.S.-Iran trade regulations to allow for the sale to Iranians of consumer electronics and software that help them communicate. Under Secretary of State Wendy Sherman testified on October 14, 2011, that some of the democracy promotion funding for Iran has been to train Iranians in the use of technologies that undermine regime Internet censorship efforts.

Democracy Promotion Funding

Binding legislation to favor democracy promotion in Iran was enacted in the 109th Congress. The Iran Freedom Support Act (P.L. 109-293), signed September 30, 2006, authorized funds (no specific dollar amount) for Iran democracy promotion. (93) Iran asserts that funding democracy promotion represents a violation of the 1981 "Algiers Accords" that settled the Iran hostage crisis and provide for non-interference in each other's internal affairs.

The George W. Bush Administration asserted that open funding of Iranian pro-democracy activists (see below) as a stated effort to change regime behavior, not to overthrow the regime, although some saw the Bush Administration's efforts as a cover to achieve a regime change objective. A few accounts, such as "Preparing the Battlefield" by Seymour Hersh in the New Yorker (July 7 and 14, 2008), say that President George W. Bush authorized U.S. covert operations to destabilize the regime, (94) involving assistance to some of the ethnic-based armed groups discussed above. CRS has no way to confirm assertions in the Hersh article that up to $400 million was appropriated and/or used to aid the groups mentioned.

The State Department, the implementer of U.S. democracy promotion programs for Iran, has used funds in appropriations (see Table 9) to support pro-democracy programs run by at organizations +based in the United States and in Europe; the department refuses to name grantees for security reasons. The funds shown below have been obligated through DRL and the Bureau of Near Eastern Affairs in partnership with USAID. Some of the funds have been appropriated for cultural exchanges, public diplomacy, and broadcasting to Iran. A further indication of the sensitivity of specifying the use of the funds is that, since FY2010, the Obama Administration has requested funds for Iran democracy promotion as part of a broader "Near East regional democracy programs" rather than delineating a specific request for Iran programs.

Many have consistently questioned the effectiveness of such funding. In the view of many experts, U.S. funds would make the aid recipients less attractive to most Iranians. Even before the post-2009 election crackdown, Iran was arresting civil society activists by alleging they are accepting the U.S. democracy promotion funds, while others have refused to participate in U.S.-funded programs, fearing arrest. (95) In May 2007--Iranian American scholar Haleh Esfandiari, of the Woodrow Wilson Center in Washington, DC, was imprisoned for several months, on the grounds that the Wilson Center was part of this effort. The center has denied being part of the democracy promotion effort in Iran.

Perhaps in response to some of these criticisms, the Obama Administration altered Iran democracy promotion programs somewhat toward working directly with Iranians inside Iran who are organized around such apolitical issues as health care, the environment, and science. (96) During 2009, less emphasis was placed on funding journalists and human rights activists in Iran, or on sponsoring visits by Iranians to the United States. (97) One issue arose concerning the State Department decision in late 2009 not to renew a contract to the Iran Human Rights Documentation Center (IHRDC), based at Yale University, which was cataloguing human rights abuses in Iran. However, IHRDC has reportedly continued to receive some U.S. funding to continue its work.

Broadcasting/Public Diplomacy Issues

Another part of the democracy promotion effort has been the development of new U.S. broadcasting services to Iran. The broadcasting component of policy has been an extension of a trend that began in the late 1990s. Radio Farda ("tomorrow," in Farsi) began under Radio Free Europe/Radio Liberty (RFE/RL), in partnership with the Voice of America (VOA), in 2002. The service was established as a successor to a smaller Iran broadcasting effort begun with an initial $4 million from the FY1998 Commerce/State/Justice appropriation (P.L. 105-119). It was to be called Radio Free Iran but was never formally given that name by RFE/RL. Radio Farda now broadcasts 24 hours/day. Radio Farda has 59 full time employees. No U.S. assistance has been provided to Iranian exile-run stations. (98)

According to information provided to CRS by the Broadcasting Board of Governors (BBG), the costs of Radio Farda are FY2010: $9.9 million; FY2011: $11.84 million; and FY2012: $11.77 million.

Persian News Network (PNN). The VOA established a Persian language service to Iran (VOA Persian Service) in July 2003. In July 2007, it was renamed Persian News Network (PNN), encompassing radio (1 hour a day or original programming); television (6 hours a day of primetime programming, rebroadcast throughout a 24-hour period); and Internet.

Even though PNN has expanded its offerings significantly, it has come under substantial criticism from observers. Some say that PNN has lost much of its audience among young, educated, anti-regime Iranians who are looking for signs of U.S. official support. The Inspector General report cited above, as well as many observers, maintains that decisions on who to put on PNN panel discussion shows have been made by a small group of Iranian exiles who deliberately deny appearances to certain Iranians with whom they disagree. Still others say that PNN frequently airs the views of Iranian groups that are advocates of U.S. engagement of the regime or who downplay regime transgressions. Some have criticized PNN for covering long-standing exiled opposition groups, such as supporters of the son of the former Shah of Iran. (99) Other critics say PNN offers little coverage of the Green Movement, even though a mission of the network is, or should be, to highlight the purported unpopularity of the regime. Others say it has run pieces pointing out such U.S. social problems as homelessness and drug use, while refusing to air pieces showcasing U.S. democracy and rule of law. Other observers say there is wide-ranging nepotism at PNN, in which employees hire their relatives and deny opportunities to employment applicants based on merit. VOA officials said in September 2012 they are attempting address some of these issues through the human resources office of the VOA.

Several observers point to one particular PNN show as having particular effect on audiences inside Iran. That show is called "Parazit" (Persian for static); it is a weekly comedy show modeled on a U.S. program on Comedy Central network called "The Daily Show." On Parazit, the writers of the show, Kambiz Hosseini and Saman Arbabi, mocked then president Ahmadinejad and other Iranian figures, using political satire. Observers say that the show deteriorated in quality in 2012 after Mr. Hosseini left the show or was ousted from it, and it was taken off PNN in February 2012. A different show that satirizes Iranian leaders and news from Iran--called On Ten--began in April 2012.

Other issues relate to the PNN's leadership and governance. In February 2011, Ramin Asgard, a former State Department officer, was hired as PNN director, (100) tasked with redressing the PNN deficiencies. However, he left in January 2012, reportedly out of frustration at his inability to restructure PNN.

According to a VOA briefing on September 21, 2012, PNN has 79 full-time employees and 114 contractors. Past costs for PNN are: FY2010, $23.78 million; FY2011, $22.5 million; and FY2012 (estimate), $23.32 million. In FY2013 its costs are expected were about $18 million.

State Department Diplomatic and Public Diplomacy Efforts

Iran has an interest section in Washington, DC, under the auspices of the Embassy of Pakistan; it is staffed by Iranian Americans. The former Iranian Embassy closed in April 1980 when the two countries broke diplomatic relations, and remains under the control of the State Department. The U.S. interest section in Tehran--under the auspices of the Embassy of Switzerland there--has no American personnel. There has been occasional U.S. consideration of requesting that Tehran allow U.S. personnel there, but Iran has not supported the idea to date.

Since 2006, the State Department has been increasing the presence of Persian-speaking U.S. diplomats in U.S. diplomatic missions around Iran, in part to help identify and facilitate Iranian participate in U.S. democracy-promotion programs. The Iran unit at the U.S. consulate in Dubai has been enlarged significantly into a "regional presence" office, and "Iran-watcher" positions have been added to U.S. diplomatic facilities in Baku, Azerbaijan; Istanbul, Turkey; Frankfurt, Germany; London; and Ashkabad, Turkmenistan, all of which have large expatriate Iranian populations and/or proximity to Iran. (101) An Iran watch position is being added in Herat, Afghanistan, in early 2013. An enlarged (eight-person) "Office of Iran Affairs" has been formed at the State Department, and it is reportedly engaged in contacts with U.S.-based exile groups such as those discussed earlier.

The State Department also is trying to enhance its public diplomacy to reach out to the Iranian population.

* In May 2003, the State Department added a Persian-language website to its list of foreign language websites, under the authority of the Bureau of International Information Programs. The website, according to a statement issued by then-Secretary of State Colin Powell, is intended to be a source of information about the United States and its policy toward Iran.

* On February 14, 2011, the State Department announced that it had begun Persian-language Twitter feeds in an effort to connect better with Internet users in Iran.

* In part to augment U.S. public diplomacy, the State Department announced in April 2011 that a Persian-speaking U.S. diplomat based at the U.S. Consulate in Dubai, would make regular appearances on Iranian official media to explain U.S. positions.

Adding or Easing International Sanctions

Many assert that it is the significant effect of sanctions on Iran's economy that caused Rouhani's election and Iranian agreement to the JPA. U.S. sanctions laws and multilateral sanctions and their effects on Iran are discussed in detail in CRS Report RS20871, Iran Sanctions, by Kenneth Katzman. The JPA eased U.S. sanctions on foreign firms and countries that deal with Iran, and requires the international community not to impose any new sanctions against Iran during the JPA period. The Administration argues that Congress should not enact--and it has threatened to veto--additional sanctions legislation while the JPA is in effect. This veto threat applies to S. 1881, even though the sanctions provisions would not take effect until after the JPA expires.

Should a comprehensive deal not be agreed, the Administration and Congress say additional sanctions are likely to be imposed. There are numerous remaining ideas and suggestions for additional economic and diplomatic sanctions against Iran. Some are U.S. sanctions, some are U.S. sanctions against foreign entities intended to compel them to exit the Iranian market, and others are multilateral or international. Other options include

* Mandating Reductions in Diplomatic Exchanges with Iran or Prohibiting Travel by Iranian Officials.

* Banning Passenger Flights to and from Iran.

* Limiting Lending to Iran by International Financial Institutions. Resolution 1747 calls for restraint on but does not outright ban international lending to Iran.

* Banning Trade Financing or Official Insurance for Trade Financing. This was not made mandatory by Resolution 1929, but several countries imposed this sanction (as far as most trade financing) subsequently.

* Banning All Investment in Iran's Energy Sector. Such a step is authorized, not mandated, by Resolution 1929, and the Iran Sanctions Act allows for U.S. sanctions against foreign investment in that sector. A growing number of countries have used that authority to impose these sanctions on Iran.

* Restricting Operations of and Insurance for Iranian Shipping. A call for restraint is in Resolution 1929, but is not mandatory. The EU and other national measures announced subsequently did include this sanction (IRISL) to take effect as of July 1.

* Imposing a Worldwide Ban on Sales of Arms to Iran. Resolution 1929 imposes a ban on sales of major weapons systems to Iran, but another option is to extend that ban to all lethal equipment.

* Imposing an International Ban on Trade With Iran, Particularly Purchases of Iranian Oil or Gas. As noted, the EU has agreed to stop all purchases of Iranian oil as of July 1, 2012, and it later banned purchases of Iranian natural gas. Other countries have cut their oil buys. An option is to impose a worldwide ban on all purchases of oil or gas, or to further pressure or incent nations to end such buys from Iran. A related idea could be the enactment of a global ban on trade with Iran or of U.S. sanctions that seek to compel a partial or comprehensive global ban on trade with Iran. As noted, H.R. 850, introduced in the 113th Congress on February 27, 2013, comes close to this later concept.

Opposition Group: People's Mojahedin Organization of Iran (PMOI)

The best-known exiled opposition group is the People's Mojahedin Organization of Iran (PMOI), also known as the Mohahedin-e-Khalq Organization (MKO). Secular and left-leaning, it was formed in the 1960s to try to overthrow the Shah of Iran and has been characterized by U.S. reports as attempting to blend several ideologies, including Marxism, feminism, and Islamism, although the organization denies that it ever advocated Marxism. It allied with pro-Khomeini forces during the Islamic revolution and, according to State Department reports, supported the November 1979 takeover of the U.S. Embassy in Tehran. The group was driven into exile after it unsuccessfully rose up against the Khomeini regime in September 1981. It is led by spouses Maryam and Massoud Rajavi; Maryam, based in France, is the "President-elect" of the PMOI-led opposition. The whereabouts of historical PMOI leader Massoud are unknown.

Even though the PMOI opposes the regime in Tehran, the State Department generally shied away from contact with the group during the 1980s and 1990s. The State Department designated the PMOI as an FTO in October 1997--during the presidency of the relatively moderate Mohammad Khatemi. The NCR was named as an alias of the PMOI in October 1999, and in August 2003, the State Department designated the NCR offices in the United States an alias of the PMOI and NCR and the Treasury Department ordered the groups' offices in the United States closed. The State Department's reports on international terrorism for the years until 201 1 asserted that the members of the organization were responsible for: the alleged killing of seven American military personnel and contract advisers to the former Shah during 1973-1976--including the deputy chief of the U.S. Military Mission in Tehran; bombings at U.S. government facilities in Tehran in 1972 as a protest of the visit to Iran of then-President Richard Nixon; and bombings of U.S. corporate offices in Iran to protest the visit of Secretary of State Kissinger. The reports also listed as terrorism several attacks by the group against regime targets (including 1981 bombings that killed high ranking officials), attacks on Iranian government facilities, and attacks on Iranian security officials. However, the reports did not assert that any of these attacks purposely targeted civilians. The group's alliance with Saddam Hussein's regime in contributed to the designation, even though Saddam was a tacit U.S. ally when the group moved to Iraq in 1986.

In challenging its FTO decision, the PMOI asserted that, by retaining the group on the FTO list, the United States was preventing the PMOI from participating in opposition activities and was giving the Iranian regime justification for executing its members. In July 2008, the PMOI petitioned to the State Department that its designation be revoked, but the Department reaffirmed the listing in January 2009 and after a January 2010 review. The reaffirmations came despite the fact that in January 2009, the European Union (EU) had removed the group from its terrorist group list (2002 designation) and in May 2008, a British appeals court determined that the group should no longer be considered a terrorist organization. In June 2012, the Appeals Court gave the State Department until October 1, 2012, to decide on the FTO designation, although without prescribing how the Department should decide. On September 28, 2012, maintaining there had not been confirmed acts of PMOI terrorism for more than a decade and that it had cooperated on the Camp Ashraf issue (below), the group was removed from the FTO list as well as from the designation as a terrorism supporter under Executive Order 13224. However, State Department officials, in a background briefing that day, said "We do not see the [PMOI] as a viable or democratic opposition movement. ...

They are not part of our picture in terms of the future of Iran." On December 20, 2012, Canada removed the group from its list of terrorist organizations. The NCR-I reopened its offices in Washington, DC, in April 2013.

Camp Ashraf Issue

The de-listing of the group has not resolved the situation of PMOI members in Iraq. U.S. forces attacked PMOI military installations in Iraq during Operation Iraqi Freedom (March 2003) and negotiated a ceasefire with PMOI elements in Iraq, according to which the approximately 3,400 PMOI members consolidated at Camp Ashraf, near the border with Iran. Its weaponry was placed in storage, guarded first by U.S. and now by Iraqi personnel.

In July 2004, the United States granted the Ashraf detainees "protected persons" status under the 4th Geneva Convention, although that designation lapsed when Iraq resumed full sovereignty in June 2004. A subsequent bilateral U.S.-Iraq agreement limited U.S. flexibility in Iraq, and the Iraqi government pledged to adhere to all international obligations. That pledge came into question on July 28, 2009, when Iraq used force to overcome resident resistance to setting up a police post in the camp. Thirteen residents of the camp were killed. On April 8, 2011, after the Iraqi government changed the Iraq Security Forces (ISF) brigade that guards Ashraf, clashes between the Iraqi force and camp residents resulted in the death of 35 Ashraf residents. The State Department issued a statement attributing the deaths to the actions of Iraq and its military. (102)

After the clash, Iraqi officials reiterated their commitment to close Ashraf at the end of 201 1 (following a full U.S. withdrawal from Iraq) in co-operation with the United Nations and other international organizations. The U.N. High Commission for Refugees (UNHCR) declared the residents "asylum seekers" and offered to assess each resident in an effort to resettle them elsewhere. The then top U.N. envoy in Iraq, Martin Kobler, offered to mediate between the issue and he called on the Iraqi government to postpone its deadline to close the camp.

In December 2011, the Iraqi government and the United Nations announced agreement to relocate the residents to former U.S. military base Camp Liberty, near Baghdad's main airport. The PMOI, which had demanded safeguards for their transfer, subsequently announced acceptance of the deal and the move to Camp Liberty (renamed Camp Hurriya). The relocation was completed by September 17, 2012, leaving a residual group of 101 PMOI persons at Ashraf. Still, the group alleges that conditions at Liberty are poor. On February 9, 2013, the camp was attacked by rockets, killing six PMOI members; the Shiite militia group Kata'ib Hezbollah (KAH) claimed responsibility. Another rocket attack on the camp took place on June 15, 2013. On September 1, 2013, 52 of the Ashraf residents were killed by organized gunmen that appeared to have, at the very least, assistance from Iraqi forces guarding Ashraf's perimeter. Seven others are missing and allegedly being held by Iraqi security forces. The survivors were moved to Camp Liberty.

The U.N. High Commission on Refugees (UNHCR) is conducting refugee status determinations for all the residents who relocated to Camp Hurriya. About 352 have been resettled through the UNHCR process: 237 went to Albania; 95 to Germany; 95 to Italy; 15 to Norway; and 2 to Finland. The United States reportedly might resettle 100 or more. Earlier, 200 Ashraf residents took advantage of an arrangement between Iran and the International Committee of the Red Cross for them to return to Iran if they disavow further PMOI activities; a few reportedly were subsequently imprisoned and mistreated.

Caption: Figure 1. Structure of the Iranian Government

Caption: Figure 2. Map of Iran

Author Contact Information

Kenneth Katzman

Specialist in Middle Eastern Affairs

kkatzman@crs.loc.gov, 7-7612

(1) At the time of his selection as Supreme Leader, Khamene'i was generally referred to at the rank of Hojjat ol-Islam, one rank below Ayatollah, suggesting his religious elevation was political rather than through traditional mechanisms.

(2) Ron Kampeas, "Iran's Crown Prince Plots Nonviolent Insurrection from Suburban Washington," Associated Press, August 26, 2002.

(3) Rafsanjani was constitutionally permitted to run because a third term would not have been consecutive with his previous two terms. In the 2001 presidential election, the Council permitted 10 out of the 814 registered candidates.

(4) A paper published by Chatham House and the University of St. Andrews strongly questions how Ahmadinejad's vote could have been as large as reported by official results, in light of past voting patterns throughout Iran. "Preliminary Analysis of the Voting Figures in Iran's 2009 Presidential Election." http://www.chathamhouse.org.uk.

(5) Iran's Khamenei 'Warns Off Bid to Free Opposition Chiefs'" Agence France Presse, July 1, 2014.

(6) No votes were: India, Indonesia, Kazakhstan, Pakistan, Russia, Venezuela, Vietnam, China, and Cuba.

(7) http://www.state.gov/j/drl/rls/hrrpt/humanrightsreport/index.htm?year=2013&dlid=220352#wrapper.

(8) Human Rights Watch, "Codifying Repression," August 29, 2012.

(9) Department of Defense. Annual Report on Military Power of Iran, April 2012. For the 2010 report, see http://media.washingtontimes.com/media/docs/2010/Apr/20/Iran_Military_Report.pdf. The reports are required by [section]1245 of the National Defense Authorization Act for FY2010 (P.L. 111-84).

(10) For a more extensive discussion of the IRGC, see Katzman, Kenneth, "The Warriors of Islam: Iran's Revolutionary Guard," Westview Press, 1993.

(11) Jay Solomon, "Iran-North Korea Pact Draws Concern," Wall Street Journal, March 9, 2013.

(12) In November 2006, the IAEA, at U.S. urging, declined to provide technical assistance to the Arak facility on the grounds that it was likely for proliferation purposes.

(13) For Iran's arguments about its program, see Iranian paid advertisement "An Unnecessary Crisis--Setting the Record Straight About Iran's Nuclear Program," in The New York Times, November 18, 2005, p. A11.

(14) "Leader Says West Knows Iran Not Seeking 'Nuclear Weapons,'" Vision of the Islamic Republic of Iran Network, February 22, 2012.

(15) The comments were posted on Khamene'i's website, khamenei.ir.

(16) The February 25, 2011, IAEA report listed Iran's declared nuclear sites as well as a summary of all the NPT obligations Iran is not meeting. IAEA report of February 25, 2011. http://lewis.armscontrolwonk.com/files/2011/02/ gov2011-7.pdf.

(17) http://www.isis-online.org/uploads/isis-reports/documents/iaea-iranreport-230514.pdf.

(18) http://isis-online.org/uploads/isis-reports/documents/IAEA_Iran_Safeguards_Report_14Nov2013.pdf.

(19) Reuters, May 22, 2014.

(20) For text of the agreement, see http://www.iaea.org/NewsCenter/Focus/IaeaIran/eu_iran14112004.shtml. EU-3-Iran negotiations on a permanent nuclear pact began on December 13, 2004, and related talks on a trade and cooperation accord (TCA) began in January 2005.

(21) Voting no: Cuba, Syria, Venezuela. Abstaining: Algeria, Belarus, Indonesia, Libya, South Africa.

(22) See http://daccessdds.un.org/doc/UNDOC/GEN/N06/290/88/PDF/N0629088.pdf7OpenElement.

(23) One source purports to have obtained the contents of the package from ABC News: http://www.basicint.org/pubs/ Notes/BN060609.htm.

(24) Dempsey, Judy. "U.S. Urged to Talk With Iran." International Herald Tribune, February 5, 2009.

(25) Text of the pact is at http://www.cfr.org/publication/22140/.

(26) It was adopted by a vote of 12-2 (Turkey and Brazil voting no) with one abstention (Lebanon).

(27) Text of the resolution is at http://www.isis-online.org/uploads/isis-reports/documents/ Draft_resolution_on_Iran_annexes.pdf.

(28) Open Source Center, "Iran: Leader Outlines Guard Corps Role, Talks of 'Heroic Flexibility,'" published September 18, 2013.

(29) The latest report can be found at http://www.isis-online.org/uploads/isis-reports/documents/iaea- iranreport230514.pdf.

(30) "Iran Pursuing Banned Items for Nuclear, Missile Work: U.S. Official." Reuters, March 16, 2014.

(31) "U.N. Document S/2014/394. Final Report of the Panel of Experts Established Pursuant to Resolution 1929 (2010). June 11, 2014.

(32) David Sanger. "Iran Outlines Nuclear Deal; Accepts Limit." New York Times, July 15, 2014.

(33) Louis Charbonneau and Parisa Hafezi. "Exclusive: Iran Nuclear Negotiators Under Pressure After Leader Speech." Reuters, July 14, 2014.

(34) Department of State. Press Statement of Secretary of State John Kerry. July 18, 2014.

(35) Ibid.

(36) Statement by Secretary of State Kerry, op.cit.

(37) Author conversation with Brookings Institution Iran expert Suzanne Maloney. U.S. Institute of Peace, July 8, 2014.

(38) Josh Rogin. "Key Senator Wants to Force Vote on Iran Deal." Daily Beast, May 16, 2014.

(39) Deputy Director of National Intelligence for Analysis, "Unclassified Report to Congress on the Acquisition of Technology Relating to Weapons of Mass Destruction and Advanced Conventional Munitions, Covering 1 January to 31 December 2010," March 2011.

(40) For more information on Iran's missile arsenal, see CRS Report R42849, Iran's Ballistic Missile and Space Launch Programs, by Steven A. Hildreth.

(41) Annual Threat Assessment of the Intelligence for the Senate Select Committee on Intelligence, Dennis C. Blair, Director of National Intelligence, February 2, 2010.

(42) William Broad and David Sanger, "Relying On Computer, U.S. Seeks to Prove Iran's Nuclear Aims," New York Times, November 13, 2005.

(43) The text of the section on Iran can be found at http://www.state.gov/j/ct/rls/crt/2013/224826.htm.

(44) http://www.newyorker.com/reporting/2013/09/30/130930fa_fact_filkms?prmtable=true&currentPage=all.

(45) Elsa Walsh, "Annals of Politics: Louis Freeh's Last Case." The New Yorker, May 14, 2001. The June 21,2001, federal grand jury indictments of 14 suspects (13 Saudis and a Lebanese citizen) in the Khobar bombing indicate that Iranian agents may have been involved, but no indictments of any Iranians were announced. In June 2002, Saudi Arabia reportedly sentenced some of the eleven Saudi suspects held there. The 9/11 Commission final report asserts that Al Qaeda might have had some as yet undetermined involvement in the Khobar Towers attacks.

(46) "Iran's Revolutionary Guard Behind Terror Cell, Says Bahrain." Saudi Gazette, February 22, 2013.

(47) Sandeep Singh Grewal. Arms Ring is Smashed by Police. Daily News, December 31. 2013.

(48) "Iran Spy Cell Dismantled in Kuwait," Associated Press, May 6, 2010; "Iran Cell Planned Attacks in Kuwait, Minister Says," Reuters, April 21,2011.

(49) For information on Iran's role in the Iraq crisis, see CRS Report R43612, Iraq Crisis and U.S. Policy, by Kenneth Katzman et al.

(50) Michael Gordon, "Iran Supplying Syrian Military Via Iraqi Airspace," New York Times, September 5, 2012.

(51) Michael Gordon and David Sanger. "U.S. Is Exploring Talks with Iran on Crisis in Iraq." New York Times, June 17, 2014.

(52) Ibid.

(53) Author conversations with experts on Iran. Washington, D.C. June--July 2014

(54) For detail on Hezbollah, see CRS Report R41446, Hezbollah: Background and Issues for Congress, by Casey L. Addis and Christopher M. Blanchard.

(55) "Israel's Peres Says Iran Arming Hizbollah," Reuters, February 4, 2002.

(56) Sebastian Rotella, "In Lebanon, Hezbollah Arms Stockpile Bigger, Deadlier," Los Angeles Times, May 4, 2008.

(57) Details and analysis on the full spectrum of Iranian assistance to Assad is provided by the Institute for the Study of War. "Iranian Strategy in Syria,"by Will Fulton, Joseph Holliday, and Sam Wyer. May 2013.

(58) Will Fulton, Joseph Holliday, and Sam Wyer, "Iranian Strategy in Syria," Institute for the Study of War, May 2013.

(59) Charles Levinson, "Iran Arms Syria With Radar," Wall Street Journal, June 30, 2010.

(60) James Ball, "Documents: Iran Helped Syria Expand Chemical Weaponry," Washington Post, July 28, 2012.

(61) Substantially more detail on Iran's activities in Afghanistan is contained in: CRS Report RL30588, Afghanistan: Post-Taliban Governance, Security, and U.S. Policy, by Kenneth Katzman.

(62) Matthew Rosenberg and Annie Lowry, "Iranian Currency Traders Find a Haven in Afghanistan," New York Times, August 18, 2012.

(63) Maria Abi-Habib, "Tehran Builds On Outreach to Taliban," Wall Street Journal, August 1, 2012.

(64) John Lancaster and Kamran Khan, "Pakistanis Say Nuclear Scientists Aided Iran," Washington Post, January 24, 2004, http://isis-online.org/uploads/isis-reports/documents/IAEA_Iran_8Nov2011.pdf.

(65) Bill Gertz, "Al Qaeda Terrorists Being Held by Iran," Washington Times, July 24, 2003.

(66) Bill Gertz, "CIA Points to Continuing Iran Tie to Al Qaeda," Washington Times, July 23, 2004.

(67) Adam Goldman. "Senior al-Qaeda Figure Leaves Iran Amid Series of Departures." Washington Post, February 16, 2014.

(68) "Tehran Pledges to Crack Down on Militants," Associated Press, July 18, 2005.

(69) Joby Warrick, "Mexican Depicts Iran's Wooing of Hispanic Youths," Washington Post, August 11,2013.

(70) Department of State, "Annex Z: Unclassified Summary of Policy Recommendations," June 2013.

(71) Martin Arostegui, "Iran Tries to Gain Sway in Latin America," Wall Street Journal, December 6, 2011.

(72) Michael Lipin. "Sudan's Iran Alliance Under Scrutiny." VOANews October 31,2012. http://www.voanews.com/ content/article/1536472.html.

(73) Mike Lewis, "Skirting the Law, Sudan's Post-CPA Arms Flows, Small Arms Survey, September 2009;" Sudan Human Security Baseline Assessment, "SAF "Were the Israelis Behind the 'Mystery' Air Strike in Sudan?" Time, April 6, 2011; "Car Blast in E. Sudan, Khartoum Points to Israel," Reuters, May 22, 2012; "Rockets and Meetings," Africa Confidential, May 25, 2012.Weapons Documented in South Kordofan," Small Arms Survey, April 2012.

(74) "Were the Israelis Behind the 'Mystery' Air Strike in Sudan?" Time, April 6, 2011; "Car Blast in E. Sudan, Khartoum Points to Israel," Reuters, May 22, 2012; "Rockets and Meetings," Africa Confidential, May 25, 2012. Weapons Documented in South Kordofan," Small Arms Survey, April 2012.

(75) http://www.csmonitor.com/World/Security-Watch/terrorism-security/2012/1025/Did-Israel-just-blow-up-an- Iranianweapons-factory-in-Sudan.

(76) Elaine Sciolino, The Outlaw State: Saddam Hussein's Quest for Power and the Gulf Crisis (New York: John Wiley and Sons, 1991), p. 168.

(77) Helene Cooper and David Sanger, "Strategy on Iran Stirs New Debate at White House," New York Times, June 16, 2007.

(78) Robin Wright, "U.S. In 'Useful' Talks With Iran," Los Angeles Times, May 13, 2003.

(79) http://www.armscontrol.org/pdf/2003_Spring_Iran_Proposal.pdf.

(80) Remarks by President Obama in Address to the United Nations General Assembly, September 24, 2013.

(81) Jeffrey Goldberg, "Obama to Iran and Israel: 'As President of the United States, I Don't Bluff'," The Atlantic, March 2, 2012.

(82) Joby Warrick, "Iran: Underground Sites Vulnerable, Experts Say," Washington Post, March 1, 2012. For an extended discussion of U.S. air strike options on Iran, see Rogers, Paul. Iran: Consequences Of a War. Oxford Research Group, February 2006.

(83) http://2scottmontgomery.blogspot.com/2011/12/panetta-brookings-speech.html.

(84) Jay Solomon and Julian Barnes, "U.S. Weighs A Direct Line to Tehran," Wall Street Journal, September 19, 2011.

(85) The U.S. deployments in the Gulf are discussed in greater detail in CRS reports on the individual GCC states. Information in this section is derived from author visits to the GCC states since 1993 and conversations with U.S. and Gulf state diplomats.

(86) David Sanger and Eric Schmitt, "To Calm Israel, U.S. Offers Ways to Restrain Iran," New York Times, September 3, 2012.

(87) This option is analyzed in substantial depth in CRS Report R42443, Israel: Possible Military Strike Against Iran's Nuclear Facilities, coordinated by Jim Zanotti.

(88) Siobhan Gorman and Danny Yadron, "Banks Seek U.S. Help on Iran Cyberattacks," Wall Street Journal, January 16, 2013.

(89) CRS conversations with U.S. officials responsible for Iran policy. 1980-1990. After a period of suspension of such assistance, in 1995, the Clinton Administration accepted a House-Senate conference agreement to include $18-$20 million in funding authority for covert operations against Iran in the FY1996 Intelligence Authorization Act (H.R. 1655, P.L. 104-93), according to a Washington Post report of December 22, 1995. The Clinton Administration reportedly focused the covert aid on changing the regime's behavior, rather than its overthrow.

(90) White House, Office of the Press Secretary, "Statement by the President on the Attempted Attack on Christmas Day and Recent Violence in Iran," December 28, 2009.

(91) http://www.whitehouse.gov/the-press-office/2011/02/27/statement-national-security-council-spokesman-tommy-vietor- iran.

(92) White House, "Remarks of President Obama Marking Nowruz," March 20, 2011.

(93) This legislation was a modification of H.R. 282, which passed the House on April 26, 2006, by a vote of 397-21, and S. 333, which was introduced in the Senate.

(94) Brian Ross and Richard Esposito, "Bush Authorizes New Covert Action Against Iran," http://blogs.abcnews.com/ theblotter/2007/05/bush_authorizes.html.

(95) Three other Iranian Americans were arrested and accused by the Intelligence Ministry of actions contrary to national security in May 2007: U.S. funded broadcast (Radio Farda) journalist Parnaz Azima (who was not in jail but was not allowed to leave Iran); Kian Tajbacksh of the Open Society Institute funded by George Soros; and businessman and peace activist Ali Shakeri. Several congressional resolutions called on Iran to release Esfandiari (S.Res. 214 agreed to by the Senate on May 24; H. Res. 430, passed by the House on June 5; and S.Res. 199). All were released by October 2007. Tajbacksh was rearrested in September 2009 and remains incarcerated.

(96) CRS conversation with U.S. officials of the "Iran Office" of the U.S. Consulate in Dubai, October 2009.

(97) Jay Solomon, "U.S. Shifts Its Strategy Toward Iran's Dissidents," Wall Street Journal, June 11, 2010.

(98) The conference report on the FY2006 regular foreign aid appropriations, P.L. 109-102, stated the sense of Congress that such support should be considered.

(99) CRS conversations with Iranian members of the Green Movement, December 2009-August 2010.

(100) http://ipsnews.net/news.asp?idnews=54504. Confirmed to CRS on February 25, 2011, by a member of the BBG.

(101) Farah Stockman, "'Long Struggle' With Iran Seen Ahead," Boston Globe, March 9, 2006.

(102) http://www.state.gOv/r/pa/prs/ps/2011/04/160404.htm.

Table 1. Supreme Leader: Grand Ayatollah Ali Khamene'i

Born in July 1939 to an Azeri (Turkic) family from Mashhad. Was
jailed by the Shah of Iran for supporting Ayatollah Khomeini's
revolution. After the regime took power in 1979, helped organize
Revolutionary Guard and other security organs. Lost use of right
arm in assassination attempt in June 1981. Was elected president
during 1981-1989 and was selected Khomeini's successor in June 1989
upon his death. Upon that selection, Khamene'i religious ranking
was advanced in official organs to "Grand Ayatollah" from the lower
ranking "Hojjat ol-Islam." But, still lacks the undisputed
authority to end factional disputes or the public adoration
Khomeini had. Has taken more of a day-to-day role since 2009
uprising, including in the nuclear negotiations issue. Sided
decisively with hardline opponents of then president Ahmadinejad
after mid-201 1, but acquiesced to the election of the relatively
moderate Rouhani. Khamene'i publicly supported the JPA but has
expressed skepticism that a permanent nuclear settlement can be
reached. Reputedly issued religious proclamation (2003) against
Iran acquiring a nuclear weapon, and has publicly (2012) called
doing so a "sin," and is widely believed to fear direct military
confrontation with United States on Iranian soil. Generally does
not meet with Western officials and is suspicious of relations with
the West as potentially making Iran vulnerable to Western cultural
influence, spying, and possible regime destabilization efforts.

Throughout career, has consistently taken hard-line stances on
regional issues, particularly toward Israel, often calling it a
cancerous tumor that needs to be excised from the region. In March
2014, publicly questioned whether the Holocaust occurred--an issue
highlighted by former president Ahmadinejad.

Fully backs efforts by Revolutionary Guard and other Iranian organs
to support pro-Iranian movements and governments, including that of
Syria. On economic issues, he has tended to support the business
community (bazaaris), and opposed state control of the economy, but
believes Iran's economy is self-sufficient enough to withstand the
effects of international sanctions.

His office is run by Mohammad Mohammadi Golpayegani, with
significant input from Khamene'i's second and increasingly
influential son, Mojtaba. Also advised by Keyhan editor Hossein
Shariatmadari and former Foreign Minister Ali Akbar Velayati.

Potential successors include Expediency Council Chairman Ayatollah
Ali Akbar Hashemi-Rafsanjani, hardline Ayatollah Mohammad Taqi
Mesbah Yazdi, Council of Guardians head Ayatollah Ahmad Jannati,
Judiciary head Ayatollah Sadeq Larijani, and frequent Tehran Friday
prayer leader Ayatollah Ahmad Khatemi. None is considered a clear
consensus choice if Khamene'i leaves the scene unexpectedly.

Source: CRS.

Table 2. Major Factions, Personalities, and Interest Groups

Conservatives

Supreme Leader         See box above.
Ali Khamene'i

President Hassan       See box below.
Rouhani

Expediency Council     Born in 1944, a
Chair Ayatollah Ali    longtime key regime
Akbar Hashemi-         strategist, Khomeini
Rafsanjani             disciple, and
                       advocate of "grand
                       bargain" to resolve
                       all outstanding
                       issues with United
                       States. Was Majles
                       speaker during 1981-
                       1989 and president
                       1989-1997. Family
                       owns large share of
                       Iran's total
                       pistachio
                       production. Ouster
                       as Assembly of
                       Experts chairman in
                       2011 widely
                       attributed to his
                       tacit support of
                       popular opposition
                       to Ahmadinejad 2009
                       reelection. That
                       perception
                       undoubtedly
                       contributed to COG
                       denying his
                       candidacy in 2013
                       presidential
                       elections, even
                       though Khamene'i had
                       reappointed him
                       Expediency Council
                       chair in March 2012.
                       Victory of close
                       ally Rouhani in the
                       2013 election has
                       revived Rafsanjani's
                       influence, and he
                       remains a widely
                       mentioned candidate
                       to succeed Khamene'i
                       should he leave the
                       scene unexpectedly.

                       The political
                       activities of
                       Rafsanjani's
                       children have
                       contributed to his
                       uneven relations
                       with Khamene'i.
                       Daughter Faizah
                       participated in
                       several 2009
                       protests, was
                       detained briefly in
                       February 201 1 for
                       protesting, and was
                       jailed in September
                       2012. Five
                       Rafsanjani family
                       members arrested in
                       June 2009 (and
                       another briefly
                       detained in March
                       2010), and son,
                       Mehdi, was released
                       on bail in December
                       2012.

Ex- President          Served as President
Mahmoud                during 2005-2013.
Ahmadinejad            First non-cleric to
                       serve as president
                       of the Islamic
                       republic since the
                       assassination of
                       then-president
                       Mohammad Ali Rajai
                       in August 1981.
                       During his term, he
                       asserted it is his
                       mission is to
                       prepare for the
                       return of the 12th
                       Imam from
                       occultation that
                       would, according to
                       Twelver Shiite
                       doctrine, be
                       accompanied by the
                       establishment of
                       Islam as the global
                       religion. Attracted
                       significant
                       criticism for
                       comments questioning
                       the Holocaust and
                       calling for Israel's
                       destruction. During
                       his second term, he
                       was largely
                       sidelined by
                       Khamene'i. Perhaps
                       to prevent his
                       criticizing the
                       regime after leaving
                       office, he was
                       permitted to start a
                       new university and
                       appointed to the
                       Expediency Council.

Majles Speaker Ali     Ali Larijani has
Larijani/Larijani      been Majles Speaker
brothers               since 2008 but did
                       not run again for
                       president in the
                       2013 election after
                       losing in 2005. Was
                       state broadcasting
                       head (19942004),
                       minister of culture
                       and Islamic guidance
                       (1993), and head of
                       Supreme National
                       Security Council and
                       chief nuclear
                       negotiator
                       (2005-2007).
                       Considered amenable
                       to a nuclear deal
                       with the
                       international
                       community.
                       Politically close to
                       Khamene'i and was a
                       leading antagonist
                       of Ahmadinejad. One
                       brother (Sadeq) is
                       judiciary head;
                       another (Mohammad
                       Javad), was deputy
                       foreign minister
                       (1980s) and now
                       heads a government
                       human rights body.
                       His predecessor as
                       Majles Speaker is
                       Gholam Ali Haddad
                       Adel, whose daughter
                       is married to
                       Khamene'i's son,
                       Mojtaba, and who ran
                       unsuccessfully for
                       president in June
                       2013.

Senior Shiite          The most senior
Clerics                clerics, most of
                       whom are in Qom,
                       including several
                       Grand Ayatollahs,
                       are generally
                       "quietist"-they
                       believe that the
                       senior clergy should
                       refrain from direct
                       involvement in
                       politics. These
                       include Grand
                       Ayatollah Nasser
                       Makarem Shirazi,
                       Grand Ayatollah
                       Abdol Karim Musavi-
                       Ardabili, and Grand
                       Ayatollah Yusuf
                       Sanei, all of whom
                       have criticized the
                       regime's crackdown
                       against
                       oppositionists.
                       Others believe in
                       political
                       involvement,
                       including Ayatollah
                       Mohammad Taqi Mesbah
                       Yazdi, the founder
                       of the hardline
                       Haqqani school and
                       spiritual mentor to
                       Ahmadinejad until
                       breaking with him in
                       2011. Yazdi is an
                       assertive defender
                       of the powers of the
                       Supreme Leader and a
                       proponent of an
                       "Islamic state"
                       rather than the
                       current "Islamic
                       republic," but fared
                       poorly in December
                       2006 elections for
                       Assembly of Experts.
                       Other hardline
                       clerics include
                       Ayatollah Kazem
                       Haeri, mentor of
                       Iraqi cleric and
                       faction leader
                       Moqtada Al Sadr; and
                       Ahmad Khatemi,
                       frequently Friday
                       prayer leader at
                       Tehran University
                       and a senior
                       Assembly of Experts
                       member. Some of
                       these figures could
                       be candidates for
                       Supreme Leader
                       should Khamene'i
                       leave the scene.

Judiciary Chief        Judiciary head since
Ayatollah Sadeq        August 2009. Like
Larijani               his brother, Majles
                       Speaker Ali
                       Larijani, Sadeq
                       Larijani is close to
                       the Supreme Leader

                       and a hard liner
                       against dissent.

Society of Militant    Longtime
Clerics                organization of
                       hardline clerics
                       headed by Ayatollah
                       Mohammad Mahdavi-
                       Kani, who became
                       chair of the
                       Assembly of Experts
                       on March 9, 2011.
                       Did not back
                       Ahmadinejad for
                       reelection in 2009
                       and led a bloc
                       opposing Ahmadinejad
                       in the March 2,
                       2012, Majles
                       elections. President
                       Rouhani is a member
                       of this group.

Bazaar Merchants       The urban bazaar
("Bazaaris")           merchants fear
                       jeopardizing the
                       economy by
                       participating in
                       political opposition
                       activity. Have
                       conducted few
                       strikes or other
                       organized action
                       since the 1979
                       revolution. Each
                       city's bazaars are
                       organized by
                       industry (e.g.,
                       carpets, gold,
                       jewelry, clothing)
                       and bazaari
                       leadership positions
                       are chosen by
                       consensus among
                       elders of each
                       industry represented
                       in the bazaar.

Opposition/"Green Movement" (Rah-e-Sabz)

All of the blocs and personalities below can be
considered, to varying degrees, part of the Green
Movement or as critics of Iran's political system.

Titular Green          The titular leader
Movement Leaders:      of the Green
Mir Hossein Musavi/    movement, Mir
Mohammad Khatemi/      Hossein Musavi, a
Mehdi Karrubi and      non-cleric, is about
Other Reformists       70. An architect by
                       training, and a
                       disciple of
                       Ayatollah Khomeini,
                       he served as foreign
                       minister (1980),
                       then prime minister
                       (1981-1989), at
                       which time he
                       successfully managed
                       the state rationing
                       program during the
                       privations of the
                       Iran-Iraq War but
                       often feuded with
                       Khamene'i, who was
                       then president. At
                       that time, he was an
                       advocate of state
                       control of the
                       economy. His post
                       was abolished in the
                       1989 revision of the
                       constitution.

                       Musavi supports
                       political and social
                       freedoms and
                       reducing Iran's
                       international
                       isolation, but
                       supports strong
                       state intervention
                       in the economy to
                       benefit workers and
                       lower classes.
                       Appeared at some
                       2009 protests,
                       sometimes harassed
                       by security agents,
                       but harder line
                       opposition leaders
                       resented his
                       statements
                       supporting
                       reconciliation with
                       the regime. He and
                       his wife (prominent
                       activist Zahra
                       Rahnevard), along
                       with fellow Green
                       Movement leader and
                       defeated 2009
                       presidential
                       candidate Mehdi
                       Karrubi, were placed
                       in detention in mid-
                       2011. In early 2014,
                       Karrubi was allowed
                       to return to his
                       home, although still
                       under the control of
                       regime guards.
                       Musavi remains in
                       detention. Karrubi
                       was Speaker of the
                       Majles during 1989-
                       1992 and 2000-2004.

                       Mohammad Khatemi was
                       elected president on
                       a reformist platform
                       in May 1997, with
                       69% of the vote;
                       reelected June 2001
                       with 77%. Rode wave
                       of sentiment for
                       easing social and
                       political
                       restrictions, but
                       these groups became
                       disillusioned with
                       Khatemi's failure as
                       president to buck
                       hardliners on reform
                       issues. He declined
                       to run again for
                       president in 2009,
                       instead supporting
                       Musavi, or in 2013.

Student Groups         Groups composed of
                       well-educated,
                       Westernized urban
                       youth are the
                       backbone of the
                       Green Movement. They
                       have attempted, with
                       mixed success, to
                       gain support of
                       older generation,
                       labor, clerics,
                       village-dwellers,
                       and other segments.
                       The Office of
                       Consolidation of
                       Unity is the student
                       group that led the
                       1999 riots but which
                       later became
                       controlled by regime
                       loyalists. An
                       offshoot, the
                       Confederation of
                       Iranian Students
                       (CIS), believes in
                       regime replacement
                       and in U.S.-style
                       free markets. CIS
                       founder, Amir Abbas
                       Fakhravar, is based
                       in Washington, DC.
                       Co-founder, Arzhang
                       Davoodi, remains in
                       prison in Iran
                       serving a lifetime
                       prison sentence.

Islamic Iran           The most prominent
Participation Front    and best organized
(IIPF)                 pro-reform grouping,
                       but has lost
                       political ground to
                       Green Movement
                       groups advocating
                       outright overthrow
                       of the regime. Its
                       leaders include
                       Khatemi's brother,
                       Mohammad Reza
                       Khatemi (a deputy
                       speaker in the 2000-
                       2004 Majles) and
                       Mohsen Mirdamadi.
                       Backed Musavi in
                       June 2009 election;
                       several IIPF leaders
                       detained and
                       prosecuted in
                       postelection
                       dispute. The party
                       was outlawed by the
                       regime in September
                       2010.

Mojahedin of the       Composed mainly of
Islamic Revolution     left-leaning Iranian
Organization (MIR)     figures who support
                       state control of the
                       economy, but want
                       greater political
                       pluralism and
                       relaxation of rules
                       on social behavior.
                       A major constituency
                       of the reformist
                       camp. Its leader is
                       former Heavy
                       Industries Minister
                       Behzad Nabavi, who
                       supported Musavi in
                       2009 election and
                       has been
                       incarcerated for
                       most of the time
                       since June 2009. The
                       organization was
                       outlawed by the
                       regime
                       simultaneously with
                       the outlawing of the
                       IIPF, above.

Combatant Clerics      Very similar name to
Association            organization above,
                       but politically very
                       different. Formed in
                       1988, it is run by
                       reformist, not
                       hardline, clerics
                       and officials.
                       Leading figures
                       include Mohammad
                       Khatemi, former
                       Interior Minister
                       Ali Akbar
                       Mohtashemi-Pur, and
                       former Prosecutor
                       General Ali Asgar
                       Musavi-Koiniha.

Labor Unions           Organized labor has
                       suffered from
                       official repression
                       for many years. It
                       was not at the core
                       of the 2009
                       uprising, but many
                       laborers have openly
                       demanded political
                       change. Some
                       laborers want
                       political change but
                       fear income
                       disruption if they
                       openly defy the
                       regime. Some labor
                       protests took place
                       in Tehran on "May
                       Day" 2010, and other
                       small strikes
                       (truckers, some
                       factories) have
                       taken place since. A
                       bus drivers' union
                       leader, Mansur
                       Osanloo, was jail
                       from 2007 until
                       2011.

Other Prominent        Other leading
Dissidents             dissidents, some in
                       Iran, others in
                       exile (including in
                       the United States),
                       have been
                       challenging the
                       regime since well
                       before the Green
                       Movement formed and
                       are now significant
                       opposition figures.
                       Journalist Akbar
                       Ganji conducted
                       hunger strikes to
                       protest regime
                       oppression; he was
                       released on schedule
                       on March 18, 2006,
                       after sentencing in
                       2001 to six years in
                       prison for alleging
                       high-level
                       involvement in 1999
                       murders of Iranian
                       dissident
                       intellectuals. Abdol
                       Karim Soroush, now
                       exiled, has
                       challenged the
                       doctrine of clerical
                       rule. Former
                       Revolutionary Guard
                       organizer Mohsen
                       Sazegara is based in
                       the United States,
                       but his role in the
                       IRGC likely
                       discredits him in
                       the eyes of
                       dissidents who want
                       regime replacement.
                       Other significant
                       dissidents include
                       former Culture
                       Minister Ataollah
                       Mohajerani, Mohsen
                       Kadivar, and U.S.-
                       based Fatemah
                       Haghighatgoo. Some
                       well-known
                       dissidents
                       incarcerated since
                       2010 include
                       filmmaker Jafar
                       Panahi; journalist
                       Abdolreza Tajik;
                       famed blogger
                       Hossein Derakshan
                       (serving a 20-year
                       prison sentence);
                       and human rights
                       lawyer Nasrin
                       Sotoudeh. Sotoudeh
                       was released in
                       September 2013, as
                       discussed below. 80-
                       year-old Iran
                       Freedom Movement
                       leader Ibrahim Yazdi
                       was released from
                       prison in April 201
                       1 after resigning as
                       the Freedom
                       Movement's leader.

                       One major dissident
                       figure is Nobel
                       Peace Prize laureate
                       (2003) and Iran
                       human rights
                       activist lawyer
                       Shirin Abadi. She
                       has often
                       represented clients
                       persecuted or
                       prosecuted by the
                       regime but she left
                       Iran for Europe,
                       fearing arrest. In
                       December 2009, the
                       regime confiscated
                       her Nobel Prize.

Monarchists            Some Iranians
                       outside Iran,
                       including in the
                       United States, want
                       to replace the
                       regime with a
                       constitutional
                       monarchy led by Reza
                       Pahlavi, the U.S.-
                       based son of the
                       late former Shah and
                       a U.S.-trained
                       combat pilot. The
                       Shah's son, who is
                       about 60 years old,
                       has delivered
                       statements
                       condemning the
                       regime for the post-
                       2009 election
                       crackdown and he has
                       called for
                       international
                       governments to
                       withdraw their
                       representation from
                       Tehran. He appears
                       periodically in
                       broadcasts into Iran
                       by Iranian exile-
                       run stations in
                       California, (2) as
                       well as in other
                       Iran-oriented media.

                       Pahlavi has always
                       had some support
                       particularly in the
                       older generation in
                       Iran, but he
                       reportedly is trying
                       to broaden his
                       following by
                       asserting that he
                       supports democracy
                       and not restoration
                       of a monarchy. Since
                       March 2011, he has
                       been increasingly
                       cooperating with-and
                       possibly attempting
                       to co-opt-younger
                       leaders in a
                       "National Council of
                       Iran" (NCI). He and
                       over 30 opposition
                       groups formally
                       established the
                       Council at a
                       conference in Paris
                       in April 2013, and
                       it drafted a set of
                       democratic
                       principles for a
                       post-Islamic
                       republic Iran.
                       However, several
                       groups have left the
                       NCI, asserting that
                       Pahlavi sought
                       inordinate control
                       over its decisions,
                       and formed a rival
                       group called the
                       "National Iran
                       Congress."

Leftist Groups         Many oppositionists
                       who support left-
                       wing ideologies
                       support the People's
                       Mojahedin
                       Organization of Iran
                       (PMOI), which is
                       discussed in a text
                       box at the end of
                       this report.

Sunni Armed            Jundullah is
Opposition:            composed of Sunni
Jundullah              Muslims primarily
                       from the Baluchistan
                       region bordering
                       Pakistan. The region
                       is inhabited by
                       members of the
                       Baluch minority and
                       is far less
                       developed than other
                       parts of Iran. On
                       the grounds that
                       Jundullah has
                       attacked civilians
                       in the course of
                       violent attacks in
                       Iran, the State
                       Department formally
                       named it an FTO on
                       November 4, 2010.
                       Some saw the
                       designation as an
                       overture toward the
                       Iranian government,
                       while

                       others saw it as a
                       sign that the United
                       States supports only
                       opposition groups
                       that are committed
                       to peaceful methods.
                       Jundullah has
                       conducted several
                       attacks on Iranian
                       security and
                       civilian officials,
                       including a May 2009
                       bombing of a mosque
                       in Zahedan and the
                       October 2009 killing
                       of five IRGC
                       commanders in Sistan
                       va Baluchistan
                       Province. The regime
                       claimed a major
                       victory against the
                       group in February
                       2010 with the
                       capture of the
                       group's top leader,
                       Abdolmalek Rigi. The
                       regime executed him
                       in June 2010, but
                       the group retaliated
                       in July 2010 with a
                       Zahedan bombing that
                       killed 28 persons,
                       including some IRGC
                       personnel.The group
                       is believed
                       responsible for a
                       December 15, 2010,
                       bombing at a mosque
                       in Chahbahar, also
                       in Baluchistan, that
                       killed 38.

Kurdish Armed          An armed Kurdish
Groups: Free Life      group operating out
Party (PJAK)           of Iraq is the Free
                       Life Party, known by
                       its acronym PJAK.
                       Its leader is
                       believed to be Abdul
                       Rahman Hajji Ahmadi,
                       born in 1941, who is
                       a citizen of Germany
                       and lives in that
                       country. Many PJAK
                       members are women,
                       supporting the
                       organization's
                       dedication to
                       women's rights. PJAK
                       was designated by
                       the Treasury
                       Department in early
                       February 2009 as a
                       terrorism supporting
                       entity under
                       Executive Order
                       13224, although the
                       designation
                       statement indicated
                       the decision was
                       based mainly on
                       PJAK's association
                       with the Turkish
                       Kurdish opposition
                       group Kongra Gel,
                       also known as the
                       PKK. Five Kurds
                       executed by Iran's
                       regime in May 2010
                       were alleged members
                       of PJAK.

                       In June 2010 and
                       July 2011, Iran
                       conducted some
                       shelling of reputed
                       PJAK bases inside
                       Iraq, reportedly
                       killing some Kurdish
                       civilians.

Arab Oppositionists/   Another militant
Ahwazi Arabs           group, the Ahwazi
                       Arabs, operates in
                       the largely Arab-
                       inhabited areas of
                       southwest Iran.
                       Relatively inactive
                       over the past few
                       years.

U.S.-Based Opposition and Advocacy-Groups

Of the more than 1 million Iranian-Americans of
differing ideologies, a vast majority want to see
a change of regime in Tehran, although many
Iranian-Americans are not active on Iran policy
issues. Many still have families living in Iran
and appear concerned that anti-regime activity
in the United States will put them in jeopardy.
Up to half of all Iranian Americans are based
in the Los Angeles area, and activists there
run small broadcasting operations into Iran.

National Iranian-      NIAC is an advocacy
American Council       group that does not
(NIAC)                 seek regime change
                       in Iran. The stated
                       mission of NIAC is
                       to promote
                       discussion of U.S.
                       policy. The group
                       advocates engagement
                       with Iran, supports
                       easing some U.S.
                       sanctions against
                       Iran and has
                       asserted that the
                       Administration is
                       actively planning to
                       take military action
                       against Iran. These
                       positions have led
                       some experts and
                       commentators to
                       allege, although
                       without providing
                       evidence, that it is
                       a front for the
                       Iranian regime. NIAC
                       has criticized the
                       regime's human
                       rights abuses.

Public Affairs         PAAIA's mission is
Alliance of Iranian-   to discuss issues
Americans (PAAIA)      affecting Iranian
                       Americans, such as
                       discrimination
                       caused by public
                       perceptions of
                       association with
                       terrorism or radical
                       Islam. Some
                       observers believe it
                       has become less
                       active since 2011
                       because of
                       desertions by some
                       members who want
                       PAAIA be more active
                       in trying to shape
                       U.S. Iran policy and
                       to take a stronger
                       stand against
                       Tehran.

Table 3. Human Rights Practices: General Categories

Group/Issue           Regime Practice/Recent
                      Developments

Ethnic and            Persians are about
Religious Breakdown   51% of the
                      population, and
                      Azeris (a T urkic
                      people) are about
                      24%. Kurds are about
                      7%-15% of the
                      population, and
                      about 3% are Arab.
                      Shiite Muslims are
                      about 90% of the
                      Muslim population
                      and Sunnis are about
                      10%. About 2% of the
                      population is non-
                      Muslim, including
                      Christians,
                      Zoroastrians (an
                      ancient religion in
                      what is now Iran),
                      Jewish, and Baha'i.

Media Freedoms        Iran's Ministry of
                      Culture and Islamic
                      Guidance has been
                      active in blocking
                      pro-reform websites
                      and blogs and
                      closing newspapers
                      critical of the
                      government, as well
                      as arresting
                      journalists and
                      bloggers. However,
                      some editors say
                      that the government
                      has become more
                      tolerant of critical
                      media since Rouhani
                      took office. The
                      Majles investigated
                      the November 2012
                      death in custody of
                      blogger, Sattar
                      Beheshti; seven
                      security officers
                      were arrested and
                      the Tehran "Cyber
                      Police" commander
                      was removed for the
                      incident. Iran is
                      setting up a
                      national network
                      that would have a
                      virtual monopoly on
                      Internet service for
                      Iranians.

Labor Restrictions    Independent unions
                      are legal but not
                      allowed in practice.
                      The sole authorized
                      national labor
                      organization is a
                      state-controlled
                      "Workers' House"
                      umbrella.

Women                 Women can vote in
                      all elections and
                      run in parliamentary
                      and municipal
                      elections. They are
                      permitted to drive,
                      and work outside the
                      home, including
                      owning their own
                      businesses, although
                      less than 20% of the
                      workforce is female
                      and women earn
                      nearly 5 times less
                      than men. Women are
                      required to be
                      covered in public,
                      generally with a
                      garment called a
                      chador, but
                      enforcement has
                      relaxed since
                      Rouhani took office.
                      Women do not have
                      inheritance or
                      divorce rights equal
                      to that of men, and
                      their court
                      testimony carries
                      half the weight of a
                      male's. Laws against
                      rape are not
                      enforced
                      effectively.

                      Nine women are in
                      the Majles, but
                      women cannot serve
                      as judges. There was
                      one woman in the
                      previous cabinet
                      (Minister of Health)
                      but she was fired in
                      December 2012 for
                      criticizing lack of
                      funding for
                      medicines. Masoumah
                      Ebtekar, a prominent
                      woman who has
                      previously served as
                      a vice president,
                      was to be the first
                      woman to deliver the
                      Friday Prayer at
                      Tehran University in
                      January 2014, but
                      her appearance was
                      cancelled.

Religious Freedom     Each year since
Overview              1999, the State
                      Department religious
                      freedom report has
                      named Iran as a
                      "Country of
                      Particular Concern"
                      under the
                      International
                      Religious Freedom
                      Act (IRFA). No
                      sanctions have been
                      added under IRFA, on
                      the grounds that
                      Iran is already
                      subject to extensive
                      U.S. sanctions.
                      Continued
                      deterioration in
                      religious freedom
                      have been noted in
                      the past few
                      International
                      Religious Freedom
                      reports, stating
                      that government
                      rhetoric and actions
                      creates a
                      threatening
                      atmosphere for
                      nearly all non-Shia
                      religious groups.

Christians            In September 2011, a
                      Protestant pastor
                      who was born a
                      Muslim, Youcef
                      Nadarkhani, was
                      sentenced to death
                      for refusing to
                      recant his Christian
                      faith. The White
                      House, State
                      Department, and many
                      human rights groups
                      called for an
                      overturning of the
                      sentence, which was
                      reaffirmed in late
                      February 2012. He
                      was released on
                      September 8, 2012,
                      but was rearrested
                      on Christmas Day
                      2012. On February
                      29, 2012, the House
                      debated but
                      postponed action on
                      H.ReS. 556 demanding
                      he be released. The
                      issue of pastor
                      Saeed Abedini, a
                      dual national, is
                      discussed below
                      under "arrest of
                      dual nationals."

Baha'is               Iran is repeatedly
                      cited for virtually
                      unrelenting
                      repression of the
                      Baha'i community,
                      which Iran's Shiite
                      Muslim clergy views
                      as a heretical sect,
                      which numbers about
                      300,000-350,000. At
                      least 30 Baha'is
                      remain imprisoned
                      and 60 were arrested
                      in 2012, according
                      to the State
                      Department IRFA
                      report for 2012.
                      U.N. Rapporteur said
                      in February 2013
                      that 110 Baha'is are
                      in jail, with 133
                      more to start
                      serving jail time.
                      Seven Baha'i leaders
                      were sentenced to 20
                      years in August
                      2010; their
                      sentences were
                      reduced in September
                      2010 to 10 years but
                      the full sentence
                      was restored on
                      appeal. In the
                      1990s, several
                      Baha'is were
                      executed for
                      apostasy. Virtually
                      yearly congressional
                      resolutions condemn
                      Iran's treatment of
                      the Baha'is.

Jews                  Along with
                      Christians, a
                      "recognized
                      minority," with one
                      seat in the Majles,
                      the 8,800-member
                      (2012 census) Jewish
                      community enjoys
                      somewhat more
                      freedoms than Jewish
                      communities in
                      several other Muslim
                      states. However, in
                      practice the freedom
                      of Iranian Jews to
                      practice their
                      religion is limited,
                      and Iranian Jews
                      remain fearful of
                      reprisals. In June
                      1999, Iran arrested
                      13 Jews that it said
                      were part of an
                      "espionage ring" for
                      Israel. After a 2000
                      trial, 10 of them
                      were convicted and
                      given sentences
                      ranging from 4 to 13
                      years. An appeals
                      panel reduced the
                      sentences and all
                      were released by
                      April 2003. On
                      November 17, 2008,
                      Iran hanged Muslim
                      businessman Ali
                      Ashtari for
                      providing Iranian
                      nuclear information
                      to Israel. On
                      September 4, 2013,
                      Rouhani's "Twitter"
                      account issued
                      greetings to Jews on
                      the occasion of
                      Jewish New Year
                      ("Rosh Hashanah").
                      The Jewish Majles
                      member accompanied
                      Rouhani on his visit
                      to the U.N. General
                      Assembly meetings in
                      September 2013.

Azeris                Azeris are
                      one-quarter of the
                      population and are
                      mostly well
                      integrated into
                      government and
                      society (Khamene'i
                      himself is of Azeri
                      heritage), but many
                      Azeris complain of
                      ethnic and
                      linguistic
                      discrimination. Each
                      year, there are
                      arrests of Azeri
                      students and
                      cultural activists
                      who press for their
                      right to celebrate
                      their culture and
                      history. The
                      government accuses
                      them of promoting
                      revolution or
                      separatism.

Kurds                 There are about 5
                      million-1 1 million
                      Kurds in Iran. The
                      Kurdish language is
                      not banned, but
                      schools do not teach
                      it and Kurdish
                      political
                      organizations,
                      activists, and media
                      outlets are
                      routinely
                      scrutinized,
                      harassed, and closed
                      down for supporting
                      greater Kurdish
                      autonomy. Several
                      Kurdish
                      oppositionists have
                      been executed since
                      2010.

Arabs                 Ethnic Arabs are
                      prominent in
                      southwestern Iran,
                      particularly
                      Khuzestan Province.
                      The 2 million to 4
                      million Arabs in
                      Iran encounter
                      systematic
                      oppression and
                      discrimination,
                      including torture
                      and a prohibition on
                      speaking or studying
                      Arabic.

Human Trafficking     The June 19, 2012
                      (latest), State
                      Department "T
                      rafficking in
                      Persons" report, for
                      the seventh
                      consecutive year,
                      placed Iran in Tier
                      3 (worst level) for
                      failing to take
                      significant action
                      to prevent
                      trafficking in
                      persons. Iranian
                      women, boys, and
                      girls are trafficked
                      for sexual
                      exploitation in Iran
                      as well to Pakistan,
                      the Persian Gulf,
                      and Europe.

Executions Policy     The United Nations
                      asserts that there
                      were 500 executions
                      in 2013 and that
                      pace has, according
                      to some human rights
                      groups, doubled thus
                      far in 2014. Iran is
                      a party to the
                      International
                      Covenant on Civil
                      and Political Rights
                      and the Convention
                      on the Rights of the
                      Child, and is
                      obligated to cease
                      the executions of
                      minors.

Stonings              In 2002, the head of
                      Iran's judiciary
                      issued a ban on
                      stoning. However,
                      Iranian officials
                      later called that
                      directive "advisory"
                      and could be ignored
                      by individual
                      judges. A sentence
                      of stoning against a
                      45-year-old woman
                      (Sakineh Ashtiani)
                      convicted of
                      adultery and
                      assisting in the
                      murder of her
                      husband was set
                      aside for further
                      review in July 2010.
                      In 2011, the stoning
                      sentence was dropped
                      but she is serving
                      10 years in prison.

Detentions of U.S.    Iran does not
Nationals and Dual    recognize dual
Nationals             nationality. An
                      Iranian American
                      journalist, Roxanna
                      Saberi, was arrested
                      in January 2009
                      allegedly because
                      her press
                      credentials had
                      expired, and was
                      released in May 12,
                      2009. Three American
                      hikers (Sara Shourd,
                      Shane Bauer, and
                      Josh Fattal) were
                      arrested in August
                      2009 after crossing
                      into Iran from a
                      hike in northern
                      Iraq. They were
                      released in 2010 and
                      2011 on $500,000
                      bail each-brokered
                      by Oman. Several
                      cases remain
                      pending, which U.S.
                      officials say the
                      raise during at the
                      margins of the
                      nuclear
                      negotiations. Former
                      FBI agent Robert
                      Levinson, remains
                      missing after a
                      visit in 2005 to
                      Kish Island to meet
                      an Iranian source
                      (Dawud Salahuddin,
                      allegedly
                      responsible for the
                      1980 killing in the
                      United States of an
                      Iranian diplomat who
                      had served the
                      Shah's government).
                      Iran denies knowing
                      his status or
                      location. In
                      December 2011,
                      Levinson's family
                      released a one-year
                      old taped statement
                      by him. In January
                      2013, his family
                      released recent
                      photos of him, and
                      they acknowledged in
                      late 2013 that his
                      visit to Kish Island
                      was partly related
                      to his contract work
                      for the CIA.

                      A former U.S.
                      Marine, Amir
                      Hekmati, was
                      arrested in 2011 and
                      remains in jail in
                      Iran allegedly for
                      spying for the
                      United States. His
                      family has been
                      permitted to visit
                      him there. On
                      December 20, 2012, a
                      U.S. Christian
                      convert of Iranian
                      origin, Rev. Saeed
                      Abedini, was
                      imprisoned for
                      "undermining
                      national security"
                      for setting up
                      orphanages in Iran
                      in partnership with
                      Iranian Christians.
                      His closed trial was
                      held January 22,
                      2013, and he was
                      convicted and
                      sentenced to eight
                      years in prison.

                      In mid-July, the
                      Washington Post's
                      Tehran correspondent
                      Jason Rezaian (a
                      dual national), was
                      detained along with
                      two American
                      journalists and
                      Rezaian's journalist
                      wife, an Iranian
                      national and
                      journalist for a UAE
                      paper.

Sources: State Department's country report on human
rights practices for 2013 (released February 27,
2014),http://www.state.gov/j/drl/rls/hrrpt/humanrights
report/index.htm?year=2013&dlid=220352#wrapper; The
International Religious Freedom Report for 2012 (May 20,
2013), http://www.state.gov/j/drl/rls/irf/religiousfreedom/
index.htm?year=2012&dlid=208398#wrapper; and the
Trafficking in Persons Report for 2013 (June 19, 2013),
http://www.state.gov/documents/organization/210740.pdf;
and U.N Special Rapporteur report (Marcy 13, 2013).

Table 4. Iran's Conventional Military Arsenal

Military Personnel: 460,000+. Regular ground force is about
220,000, Revolutionary Guard Corps (IRGC) ground force is about
130,000. Remainders are regular and IRGC navy (18,000 and 20,000
personnel respectively) and Air Forces (52,000 regular Air Force
personnel and 5,000 Guard Air Force personnel.) About 12,000 air
defense.

Security Forces: About 40,000-60,000 law enforcement forces on
duty, with another 600,000 Basij security/paramilitary forces
available for combat or internal security missions.

Tanks: 1,800+ Includes 480 Russian-made T-72

Ships: 100+ (IRGC and regular Navy) Includes 4 Corvette; 18
IRGC-controlled Chinese-made patrol boats, several hundred small
boats.) Also has 3 Kilo subs (reg. Navy controlled). 2012 DOD
report says Iran may have acquired additional ships and submarines
over the past two years, but does not stipulate a supplier, if any.

Midget Subs: Iran has been long said to possess several small subs,
possibly purchased assembled or in kit form from North Korea. Iran
claimed on November 29, 2007, to have produced a new small sub
equipped with sonar-evading technology, and it claimed to deploy
four Iranian-made "Ghadir class" subs to the Red Sea in June 2011.

Surface-to-Air Missiles (SAMs): 150+ I-Hawk plus possibly some
Stinger

Combat Aircraft: 330+ Includes 25 MiG-29 and 30 Su-24. Still
dependent on U.S. F-4's, F-5's and F-14 bought during Shah's era.

Anti-aircraft Missile Systems: Russia delivered to Iran (January
2007) 30 anti-aircraft missile systems (Tor Ml), worth over $1
billion. In December 2007, Russia agreed to sell the highly capable
S-300 air defense system, which would greatly enhance Iran's air
defense capability, at an estimated cost of $800 million. The
system would not, according to most experts, technically violate
the provisions of U.N. Resolution 1929, because the system is not
covered in the U.N. Registry on Conventional Arms. However, on
September 22, 2010, then Russian President Medvedev signed a decree
banning the supply of the system to Iran, asserting that its
provision to Iran is banned by Resolution 1929. In August 2011,
Iran and Russia took their dispute over the non-delivery of the
S-300 to the International Court of Justice. In November 2011, Iran
claimed to have deployed its own version (Mersad) of the system,
and in January 2014 an Iranian parliamentarian said Iran was
pursuing with Russia potential delivery of a substitute system for
the S-300.

Defense Budget: About 3% of GDP

Sources: IISS Military Balance--Section on Middle East and North
Africa, and various press reports; April 2010 and April 2012 DOD
reports on military power of Iran, cited earlier.

Table 5. The Islamic Revolutionary Guard Corps (IRGC)

The IRGC is generally loyal to Iran's hardliners politically and is
clearly more politically influential than is Iran's regular
military, which is numerically larger, but was held over from the
Shah's era. The IRGC's political influence has grown sharply as the
regime has relied on it to suppress dissent. As described in a 2009
Rand Corporation study," Founded by a decree from Ayatollah
Khomeini shortly after the victory of the 1978-1979 Islamic
Revolution, Iran's Islamic Revolutionary Guards Corps (IRGC) has
evolved well beyond its original foundations as an ideological
guard for the nascent revolutionary regime ... The IRGC's presence
is particularly powerful in Iran's highly factionalized political
system, in which [many senior figures] hail from the ranks of the
IRGC ..."

Through its Qods (Jerusalem) Force (QF), the IRGC has a foreign
policy role in exerting influence throughout the region by
supporting pro-Iranian movements and leaders. The QF numbers
approximately 10,000-15,000 personnel who provide advice, support,
and arrange weapons deliveries to pro-Iranian factions or leaders
in Lebanon, Iraq, Syria, Persian Gulf states, Gaza/West Bank,
Afghanistan, and Central Asia. IRGC leaders have confirmed the QF
is in Syria to assist the regime of Bashar al-Assad against an
armed uprising, and it reportedly provided advisers to help the
Iraqi government counter an offensive by Sunni Islamist extremists
in June 2014. The QF commander, Brigadier General Qassem Soleimani
reportedly has a direct and independent channel to Khamene'i. The
QF commander during 1988-1995 was Brigadier General Ahmad Vahidi,
who served as Defense minister during 2009-2013. He led the QF when
it allegedly assisted two bombings of Israeli and Jewish targets in
Buenos Aires and is wanted by Interpol for a role in the 1994
bombing there. He allegedly recruited Saudi Hezbollah activists
later accused of the June 1996 Khobar Towers bombing; and
assassinated Iranian dissident leaders in Europe in the early
1990s.

IRGC leadership developments are significant because of the
political influence of the IRGC. On September 2, 2007, Khamene'i
named Mohammad Ali Jafari as commander in chief of the Guard.
Jafari is considered a hardliner against political dissent and a
close ally of the Supreme Leader. He criticized Rouhani for
accepting a phone call from President Obama on September 27, 2013,
and has continued to oppose major concessions as part of a
permanent nuclear settlement. The Basij reports to the IRGC
commander in chief; its leader is Brigadier General Mohammad Reza
Naqdi. It operates from thousands of positions in Iran's
institutions. Command reshuffles in July 2008 integrated the Basij
more closely with provincially based IRGC units and increased the
Basij role in internal security. In November 2009, the regime gave
the IRGC's intelligence units greater authority, perhaps surpassing
those of the Ministry of Intelligence, in monitoring dissent. The
IRGC Navy has responsibility to patrol the Strait of Hormuz and the
regular Navy has responsibility for the broader Arabian Sea and
Gulf of Oman (deeper waters further off the coast).

As noted, the IRGC is also increasingly involved in Iran's economy,
acting through a network of contracting businesses it has set up,
most notably Ghorb (also called Khatem ol-Anbiya, Persian for "Seal
of the Prophet"). Active duty IRGC senior commanders reportedly
serve on Ghorb's board of directors and its chief executive, Rostam
Ghasemi, served as Oil Minister during 2011-2013. In September
2009, the Guard bought a 50% stake in Iran Telecommunication
Company at a cost of $7.8 billion. The Wall Street Journal reported
on May 27, 2014 that Khatam ol-Anbia has $50 billion in contracts
with the Iranian government, including in the energy sector but
also in port and highway construction. It has as many as 40,000
employees.

On October 21,2007, the Treasury Department designated several IRGC
companies as proliferation entities under Executive Order 13382.
Also that day, the IRGC as a whole, the Ministry of Defense,
several IRGC commanders, and several Iranian banks were sanctioned
under that same executive order. Simultaneously, the Qods Force was
named as a terrorism supporting entity under Executive Order 13224.
These orders freeze the U.S.-based assets and prevent U.S.
transactions with the named entities, but these entities are
believed to have virtually no U.S.-based assets. On June 9, 2011,
the IRGC and Basij were named as human rights abusers under
Executive Order 13553, with the same penalties as the above
Executive Orders.

Sources: Frederic Wehrey et al., "The Rise of the Pasdaran," Rand
Corporation, 2009; Katzman, Kenneth, "The Warriors of Islam: Iran's
Revolutionary Guard," Westview Press, 1993; Dept. of the Treasury;
http://www.newyorker.com/reporting/20l3/09/30/l30930fa fact
filkins?printable=true&currentPage=all.

Table 6. Summary of Provisions of U.N. Resolutions on Iran Nuclear
Program (1737, 1747, 1803, and 1929)

Requires Iran to suspend uranium enrichment, cease construction of
the heavy water reactor at Arak, and sign the Additional Protocol.
(1737 and subsequent resolutions)

Prohibits transfer to Iran of nuclear, missile, and dual use items,
except for use in light-water reactors. (All combined) Prohibits
Iran from exporting arms or WMD-useful technology. (1747)

Prohibits Iran from investing abroad in uranium mining, related
nuclear technologies or nuclear capable ballistic missile
technology. Prohibits Iran from launching ballistic missiles even
on its own territory. (1929)

Freezes the assets of over 80 named Iranian persons and entities,
including Bank Sepah, and several corporate affiliates of the
Revolutionary Guard. (1737 and subsequent resolutions)

Requires that countries ban the travel of over 40 named Iranians.

Mandates that countries not export major combat systems to Iran. It
did not bar sales of missiles not on the "U.N. Registry of
Conventional Arms" (meaning that the delivery of the S-300 system,
discussed above, would not be legally banned). (1929)

Calls for "vigilance" (a nonbinding call to cut off business) with
respect to all Iranian banks, particularly Bank Melli and Bank
Saderat. (1929)

Calls for vigilance (voluntary restraint) with respect to providing
international lending to Iran and providing trade credits and other
financing and financial interactions. (1929)

Calls on countries to inspect cargoes carried by Iran Air Cargo and
Islamic Republic of Iran Shipping Lines--or by any ships in
national or international waters--if there are indications they
carry cargo banned for carriage to Iran. Searches in international
waters would require concurrence of the country where the ship is
registered. (1929)

A Sanctions Committee, composed of the 15 members of the Security
Council, monitors implementation of all Iran sanctions and collects
and disseminates information on Iranian violations and other
entities involved in banned activities. A seven-member "panel of
experts" is empowered (renewable each year) to report on sanctions
violations and make recommendations for improved enforcement. The
panel's reports are not officially published by the Sanctions
Committee but are usually carried by various websites. Resolution
2105, adopted June 5, 2013, extended the mandate of the Panel of
Experts until July 9, 2014. (1929)

Table 7. Iran's Missile Arsenal

Shahab-3 ("Meteor")   800-mile range. The
                      missile is
                      operational, and
                      Defense Department
                      report of April
                      2012, indicates
                      Tehran has improved
                      its lethality and
                      effectiveness,
                      tempering previous
                      assessments by
                      experts that the
                      missile is not
                      completely reliable.

Shahab-3 "Variant"    1,200-1,500-mile
/Sijil/Ashoura        range. The April
                      2010 Defense
                      Department report
                      had the liquid
                      fueled Shahab-3
                      "variant" as
                      "possibly deployed,"
                      and the April 2102
                      report indicates the
                      solid fuel version
                      (Sijil or Ashoura)
                      is increasing in
                      range, lethality,
                      and accuracy. These
                      missiles potentially
                      put large portions
                      of the Near East and
                      Southeastern Europe
                      in range, including
                      U.S. bases in
                      Turkey. A U.N.
                      experts panel
                      reported in May 2011
                      that Iran tested the
                      missile in October
                      2010 although the
                      launch was "reported
                      by a [U.N.] Member
                      state," and not
                      announced publicly.
                      In concert with the
                      beginning of 10-day
                      "Great Prophet Six"
                      military exercises,
                      on June 28, 2011,
                      Iran unveiled
                      underground missile
                      silos.

BM-25                 1,500-mile range. On
                      April 27, 2006,
                      Israel's military
                      intelligence chief
                      said that Iran had
                      received a shipment
                      of North
                      Korean-supplied
                      BM-25 missiles.
                      Missile said to be
                      capable of carrying
                      nuclear warheads.
                      The Washington Times
                      appeared to
                      corroborate this
                      reporting in a July
                      6, 2006, story,
                      which asserted that
                      the North
                      Korean-supplied
                      missile is based on
                      a Soviet-era
                      "SS-N-6" missile.
                      Press accounts in
                      December 2010
                      indicate that Iran
                      may have received
                      components but not
                      the entire BM-25
                      missile from North
                      Korea.

ICBM                  U.S. officials
                      believe Iran might
                      be capable of
                      developing an
                      intercontinental
                      ballistic missile
                      (3,000 mile range)
                      by 2015, a time
                      frame reiterated by
                      the April 2012 DOD
                      report.

Short Range           Iran is fielding
Ballistic Missiles    increasingly
and Cruise Missiles   capable, short range
                      ballistic missiles,
                      according to DOD
                      2012 report, such as
                      ability to home in
                      on and target ships
                      while in flight. One
                      version could be a
                      short range
                      ballistic missile
                      named the Qiam,
                      tested in August
                      2010. Iran has long
                      worked on a 200 mile
                      range "Fateh 1 10"
                      missile (solid
                      propellant), which
                      it again tested in
                      August 2012. Iran
                      also possesses a few
                      hundred short-range
                      ballistic missiles,
                      including the
                      Shahab-1 (Scud-b),
                      the Shahab-2
                      (Scud-C), and the
                      Tondar-69 (CSS-8).
                      In January 2009,
                      Iran claimed to have
                      tested a new
                      air-to-air missile.
                      On March 7, 2010,
                      Iran claimed it was
                      producing
                      short-range cruise
                      missiles that it
                      claimed are highly
                      accurate and can
                      destroy heavy
                      targets. Iran also
                      is able to arm its
                      patrol boats with
                      Chinese-made C-802
                      cruise missiles.
                      Iran also has
                      Chinese-supplied
                      Seerseekers and
                      C-802's emplaced
                      along Iran's coast.

Space Vehicle         In February 2008
                      Iran claimed to have
                      launched a probe
                      into space,
                      suggesting its
                      missile technology
                      might be improving
                      to the point where
                      an Iranian ICBM is
                      realistic. Following
                      an August 2008
                      failure, in early
                      February 2009, Iran
                      successfully
                      launched a small,
                      low-earth satellite
                      on a Safir-2 rocket
                      (range about 155
                      miles). The Pentagon
                      said the launch was
                      "clearly a concern
                      of ours" because
                      "there are dual-use
                      capabilities here
                      which could be
                      applied toward the
                      development of
                      long-range
                      missiles." A larger
                      space vehicle,
                      Simorgh, was
                      displayed in
                      February 2010. Iran
                      claimed a satellite
                      launch into orbit on
                      June 16, 2011. Iran
                      says it plans
                      another space launch
                      in late December
                      2013.

Warheads              Wall Street Journal
                      report of September
                      14, 2005, said that
                      U.S. intelligence
                      believes Iran is
                      working to adapt the
                      Shahab-3 to deliver
                      a nuclear warhead.
                      Subsequent press
                      reports say that
                      U.S. intelligence
                      captured an Iranian
                      computer in mid-2004
                      showing plans to
                      construct a nuclear
                      warhead for the
                      Shahab. (42)

Table 8. Major Past Acts of Iran or Iran-Related Terrorism

Date                 Incident/Event         Likely/Claimed
                                            Perpetrator

April 18, 1983       Truck bombing of       Factions that
                     U.S. Embassy in        eventually formed
                     Beirut, Lebanon. 63    Lebanese Hezbollah
                     dead, including 17     claimed
                     U.S. citizens.         responsibility.

October 23, 1983     Truck bombing of       Same as above
                     U.S. Marine barracks
                     in Beirut. 241
                     Marines killed.

December 12, 1983    Bombings of U.S. and   Da'wa Party of
                     French embassies in    Iraq--Iran-supported
                     Kuwait City. 5         Iraqi Shiite
                     fatalities.            militant group. 17
                                            Da'wa activists
                                            charged and
                                            imprisoned in Kuwait

September 20, 1984   Truck bombing of       Factions that
                     U.S. embassy annex     eventually formed
                     in Beirut. 23          Lebanese Hezbollah
                     killed.

May 25, 1985         Bombing of Amir of     Da'wa Party of Iraq
                     Kuwait's motorcade

June 14, 1985        Hijacking of TWA       Lebanese Hezbollah
                     Flight 847. One
                     fatality, Navy diver
                     Robert Stetham

April 5, 1988        Hijacking of Kuwait    Lebanese Hezbollah,
                     Air passenger plane.   seeking release of
                     Two killed.            17 Da'wa prisoners
                                            in Kuwait.

March 17, 1992       Bombing of Israeli     Lebanese Hezbollah,
                     Embassy in Buenos      assisted by Iranian
                     Aires. 29 killed.      intelligence/
                                            diplomats.

July 18, 1994        Bombing of             Same as above
                     Argentine-Jewish
                     Mutual Association
                     (AMIA) building in
                     Buenos Aires.

June 25, 1996        Bombing of Khobar      Saudi Hezbollah,
                     Towers housing         supported by Iran,
                     complex near           but some assessments
                     Dhahran, Saudi         point to involvement
                     Arabia. 19 U.S. Air    of Al Qaeda.
                     Force personnel
                     killed.

July 19, 2012        Bombing in Bulgaria    Lebanese Hezbollah
                     killed five Israeli
                     tourists.

Source: State Department Country Reports on Terrorism.

Table 9. Iran Democracy Promotion Funding

FY2004         Foreign operations
               appropriation (P.L.
               108-199) earmarked
               $1.5 million for
               "educational,
               humanitarian and
               non-governmental
               organizations and
               individuals inside
               Iran to support the
               advancement of
               democracy and human
               rights in Iran." The
               State Department
               Bureau of Democracy
               and Labor (DRL) gave
               $1 million to a unit
               of Yale University,
               and $500,000 to
               National Endowment
               for Democracy.

FY2005         $3 million from
               FY2005 foreign aid
               appropriation (P.L.
               108-447) for
               democracy promotion.
               Priority areas:
               political party
               development, media,
               labor rights, civil
               society promotion,
               and human rights.

FY2006         $11.15 for democracy
               promotion from
               regular FY2006
               foreign aid
               appropriation (P.L.
               109-102). $4.15
               million administered
               by DRL and $7
               million for the
               Bureau of Near
               Eastern Affairs.

FY2006 supp.   Total of $66.1
               million (of $75
               million requested)
               from FY2006
               supplemental (P.L.
               109-234): $20
               million for
               democracy promotion;
               $5 million for
               public diplomacy
               directed at the
               Iranian population;
               $5 million for
               cultural exchanges;
               and $36.1 million
               for Voice of
               America-TV and
               "Radio Farda"
               broadcasting.
               Broadcasting funds
               are provided through
               the Broadcasting
               Board of Governors.

FY2007         FY2007 continuing
               resolution provided
               $6.55 million for
               Iran (and Syria) to
               be administered
               through DRL. $3.04
               million was used for
               Iran. No funds were
               requested.

FY2008         $60 million (of $75
               million requested)
               is contained in
               Consolidated
               Appropriation (H.R.
               2764, P.L. 110-161),
               of which, according
               to the conference
               report $21.6 million
               is ESF for
               pro-democracy
               programs, including
               non-violent efforts
               to oppose Iran's
               meddling in other
               countries. $7.9
               million is from a
               "Democracy Fund" for
               use by DRL. The
               Appropriation also
               fully funded
               additional $33.6
               million requested
               for Iran
               broadcasting: $20
               million for VOA
               Persian service; and
               $8.1 million for
               Radio Farda; and
               $5.5 million for
               exchanges with Iran.

FY2009         Request was for $65
               million in ESF "to
               support the
               aspirations of the
               Iranian people for a
               democratic and open
               society by promoting
               civil society, civic
               participation, media
               freedom, and freedom
               of information."
               H.R. 1105 (P.L.
               111-8) provides $25
               million for
               democracy promotion
               programs in the
               region, including in
               Iran.

FY2010         $40 million
               requested and used
               for Near East
               Regional Democracy
               programming.
               Programs to promote
               human rights, civil
               society, and public
               diplomacy in Iran
               constitute a
               significant use of
               these region-wide
               funds.

FY2011         $40 million
               requested and will
               be used for Near
               East Regional
               Democracy programs.
               Programming for Iran
               with these funds to
               be similar to
               FY2010.

FY2012         $35 million for Near
               East Regional
               Democracy, and
               Iran-related use
               similar to FY20I0
               and FY2011.

FY2013         $30 million for Near
               East Regional
               Democracy, with Iran
               use similar to prior
               two fiscal years.

FY2014         $30 million for Near
               East Regional
               Democracy, with Iran
               use similar to prior
               three fiscal years.

FY2015         $30 million
               requested for Near
               East Regional
               Democracy, with Iran
               use likely similar
               to previous years.
               Request mentions
               funding to be used
               to help circumvent
               Internet censorship
               in countries where
               the funds are to be
               used.

Sources: Information provided by State Department
and reviewed by Department's Iran Office,
February 1,2010; State Department Congressional
Budget Justifications; author conversation with
Department of State Iran Office, April 21,2011.

Table 10. Digest of Existing U.S. Sanctions Against Iran

Ban on U.S. Trade With and Investment in Iran. Executive Order
12959 (May 6, 1995) bans almost all U.S. trade with and investment
in Iran. Modifications in 1999 and 2000 allowed for exportation of
U.S. food and medical equipment, and importation from Iran of
luxury goods (carpets, caviar, dried fruits, nuts), but P.L.
111-195 (Comprehensive Iran Sanctions, Accountability, and
Divestment Act, CISADA) restored the complete ban on imports. The
trade ban does not generally apply to foreign subsidiaries of U.S.
firms. P.L. 112-239 sanctions most foreign dealings with Iran's
energy, shipping, and shipbuilding sector, as well as the sale of
certain items for Iranian industrial processes and the transfer to
Iran of precious metals (often a form of payment for oil or gas).

U.S. Sanctions Against Foreign Firms that Deal With Iran's Energy
Sector. The Iran Sanctions Act (P.L. 104-172, August 5, 1996, as
amended, most recently by H.R. 1905/P.L. 112-158) authorizes the
President to select five out of a menu of twelve sanctions to
impose against firms that the Administration has determined: have
invested more than $20 million to develop Iran's petroleum (oil and
gas) sector; that buy Iranian oil (unless such country has a
sanctions exemption under the FY20I2 National Defense Act, see
below); have sold Iran more than $1 million worth of gasoline or
equipment to import gasoline or refine oil into gasoline; have sold
energy $ I million or more worth of energy equipment to Iran; that
provided shipping services to transport oil from Iran; that have
engaged in an energy joint venture with Iran outside Iran; or that
buy Iran's sovereign debt.

Sanctions On Iran's Central Bank. CISADA bans accounts with banks
that do business with the Revolutionary Guard and sanctioned
entities and the Treasury Dept. in November 2011 declared Iran's
financial system an entity of primary money laundering concern.
Section 1245 of the FY2012 National Defense Act, signed December
31,2011, prevents foreign banks that do business with Iran's
Central Bank from opening U.S. accounts.

Terrorism List Designation Sanctions. Iran's designation by the
Secretary of State as a "state sponsor of terrorism" (January 19,
1984--commonly referred to as the "terrorism list") triggers
several sanctions, including the following: (1) a ban on the
provision of U.S. foreign assistance to Iran under Section 620A of
the Foreign Assistance Act; (2) a ban on arms exports to Iran under
Section 40 of the Arms Export Control Act (P.L. 95-92, as amended);
(3) under Section 6(j) of the Export Administration Act (P.L.
96-72, as amended), a significant restriction--amended by other
laws to a "presumption of denial"--on U.S. exports to Iran of items
that could have military applications; (4) under Section 327 of the
Anti-Terrorism and Effective Death Penalty Act (P.L. 104-132, April
24, 1996), a requirement that U.S. representatives to international
financial institutions vote against international loans to
terrorism list states.

Sanctions Against Foreign Firms that Aid Iran's Weapons of Mass
Destruction Programs. The Iran-Syria-North Korea Nonproliferation
Act (P.L. 106-178, March 14, 2000, as amended) authorizes the
Administration to impose sanctions on foreign persons or firms
determined to have provided assistance to Iran's weapons of mass
destruction (WMD) programs. Sanctions include restrictions on U.S.
trade with the sanctioned entity.

Sanctions Against Foreign Firms that Sell Advanced Arms to Iran.
The Iran-Iraq Arms Nonproliferation Act (P.L. 102-484, October 23,
I992, as amended) provides for U.S. sanctions against foreign firms
that sell Iran "destabilizing numbers and types of conventional
weapons" or WMD technology.

Ban on Transactions With Foreign Entities Determined to Be
Supporting International Terrorism. Executive Order 13324
(September 23, 2001) authorizes a ban on U.S. transactions with
entities determined to be supporting international terrorism. The
Order was not specific to Iran, coming 12 days after the September
11, 2001, attacks, but several Iranian entities have been
designated.

Ban on Transactions With Foreign Entities that Support
Proliferation. Executive Order I3382 (June 28, 2005) amended
previous executive orders to provide for a ban on U.S. transactions
with entities determined to be supporting international
proliferation. As is the case for Executive Order I3324, mentioned
above, Executive Order 13382 was not specific to Iran. However,
numerous Iranian entities, including the IRGC itself, have been
designated.

Divestment. A Title in P.L. 111-195 authorizes and protects from
lawsuits various investment managers who divest from shares of
firms that conduct sanctionable business with Iran.

Counter-Narcotics. In February I987, Iran was first designated as a
state that failed to cooperate with U.S. anti-drug efforts or take
adequate steps to control narcotics production or trafficking. The
Clinton Administration, on December 7, I998, removed Iran from the
U.S. list of major drug producing countries. This exempted Iran
from the annual certification process that kept drug-related U.S.
sanctions in place on Iran.

Sanctions Against Human Rights Abuses and Internet Monitoring.
Various laws discussed above, and Executive Orders, impose
sanctions on named Iranian human rights abusers, and on firms that
sell equipment Iran can use to monitor the Internet usage of
citizens or employ against demonstrators.

Source: CRS. For analysis and extended discussion of U.S. and
international sanctions against Iran, see CRS Report RS20871, Iran
Sanctions, by Kenneth Katzman.

Table 11. Selected Economic Indicators

Economic Growth           Negative 5% growth in 2013

Per Capita Income         $12,800/yr (purchasing power
                          parity) (2013)

GDP                       $988 billion (purchasing power
                          parity) (2013)

Proven Oil Reserves       135 billion barrels (highest
                          after Russia and Canada)

Oil Production/Exports    About 1 mbd exports since the
                          end of 2013.

Major Oil/Gas Customers   Remaining customers: primarily
                          China, India, South Korea,
                          Japan, and Turkey. Turkey also
                          buys 8.6 billion cubic
                          meters/yr of gas from Iran.

Major Export Markets      Mirrors major oil customers.

Major Imports             Mirrors major oil customers.

Development Assistance    2003 (latest available): $136
Received                  million grant aid. Biggest
                          donors: Germany ($38 million);
                          Japan ($17 million); France
                          ($9 million).

Inflation                 30%+, according to Iran
                          Central Bank, but believed to
                          be about 42% by outside
                          experts.

Unemployment Rate         Official rate is 15.3%, but
                          outside experts believe the
                          rate is higher

Sources: CIA, The World Factbook; various press; IMF; Iran
Trade Planning Division; CRS conversations with experts and
foreign diplomats.


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