Iraq and IranWith the United States formally ending its military operations in Iraq, many analysts are beginning to examine Iran’s deep influence in the country. In light of of Iran’s growing tensions with the West over its burgeoning nuclear program, Tehran’s maneuvers in Iraq carry tremendous strategic implications.

Arguably, Tehran has been among the biggest beneficiaries, albeit inadvertently, of the U.S. invasion of Iraq. Not only has Washington neutralized Iran’s historical nemesis in the Baathist Sunni regime in Baghdad, but it has also opened a new chapter in Tehran’s bilateral relations with Iraq.

The United States must therefore weigh its every move toward Iran against Iran’s relationship toward Iraq.

Iran’s Economic Dominance

As the second-biggest economy in the Middle East (and 17th in the world), Iran is well positioned to play a key role in Iraq as it continues to rebuild from years of devastating conflict. Today, Iran enjoys a strong and amicable partnership with its Arab neighbor, cultivating a growing trade and investment relationship with Baghdad. Iraq is already among Iran’s biggest economic partners, serving as Tehran’s second-largest non-oil export market.

Bilateral trade stands at around $8 billion per year and is expected to grow exponentially in coming years.

Iran is Iraq’s biggest trading partner, with Iranian products accounting for a huge chunk of Iraq’s imports. Iran’s presence in Iraq is most pronounced through its significant and growing commodity exports, as well as in the thousands of Iranian pilgrims who regularly visit holy shrines in Karbala and Najaf. Iranian commodities, from vegetables to electronic products, construction materials, machinery, and automobiles, have flooded Iraqi markets. Iran has also been active in health, education, and major infrastructural projects in Iraq. The relationship is deep, friendly, and comprehensive.

Turning the Table

Prior to the fall of Saddam Hussein, Iran had to contend with decades of hostile, expansionist pan-Arabist ideology espoused by Sunni minority-dominated Iraq. Iran, under both monarchical and revolutionary rule, had to grapple with its hostile Arab neighbor to the west. After decades of tension between the pro-American Shah of Iran and pro-Soviet Baghdad, years marked by intermittent territorial confrontations and active Iraqi support for separatist movements in southern Iran, a nascent post-revolutionary Iran suffered all the more as a result of the 1980 Iraqi invasion.

The “imposed war,” jang-e-tahmili, stretched over eight years, imposing heavy casualties and large-scale infrastructural devastation on an increasingly isolated Iran. The cost of the war was immense. In economic terms, the war carried a price tag of around $100 billion in accounting costs and perhaps around $1 trillion in long-term opportunity costs. The human cost was also unbearably painful, with estimates of casualties ranging from hundreds of thousands to possibly a million individuals on both sides. The war with Iraq undoubtedly left a psychological wound in the Iranian psyche. Saddam’s use of chemical weapons against Iranians meant that casualties and reminders of his atrocities would stretch over years, if not decades.

Iran’s struggle with Iraq was a defining moment in its post-revolutionary history. The war unified the country and consolidated a nascent regime. Moreover, the war provided tactical lessons and crucial military insights for Iran’s leadership. Iran’s savvy intelligence and security elements, especially the Iranian Revolutionary Guards Corps (IRGC), consider the war their most formative period, enabling them to improve their developmental trajectory, enhance their operational sophistication, and build their tactical maturity. No wonder Iran possesses one of the most effective and powerful intelligence-security agencies in the region. Overall, Iran’s national security doctrine has been very much informed by painful lessons drawn from the war experience. This is the prism through which Iran’s maneuvering in Iraq should be viewed.

Iran’s Role in the Post-Saddam Era

From Iran’s perspective, one of the greatest threats to its national security is the emergence of another Baathist-like government composed of pan-Arabist, anti-Iranian, Sunni elements in Iraq. Although Shia communities compose a majority of Iraq’s ethnically diverse population, they have been marginalized and often persecuted for much of Iraq’s recent history. In a democratic Iraq, where the electorate tends to vote along sectarian lines, the Shia are natural winners. Major Iraqi Shia figures and leaders, from Prime Minister Maliki to the prominent Shia leaders Muqtada Al-Sadr and Grand Ayatollah Ali Al-Sistani, have lived at various times in Iran, which has enabled Tehran to cultivate strong personal and political relationships with Iraq’s Shia leadership. Therefore, it has always been in Iran’s interest to have a more or less democratic Iraq where the Shia majority can play a prominent role.

Ironically, Iran shares the U.S. interest in preventing the emergence of extremist Wahhabi elements in Iraq’s volatile western territories. Any security vacuum in Iraq means greater opportunity for hostile anti-Iranian elements to gain a foothold in the country. They could also serve as an extension of the influence of neighboring Arab countries, which are wary of Iran’s purported regional ascendance. This is the reason why Iran has been keen on facilitating the stabilization of Iraq’s tangled politics, notably playing an important mediating role when Prime Minister Nouri Al-Maliki desperately sought Muqtada Al-Sadr’s support to form a coalition government to outmaneuver the anti-Iranian Iraqiya party, led by the former interim Prime Minister Ayad Allawi.

Crucially, Iran is also in a unique position to ensure that Maliki’s current maneuvers against Sunni politicians do not lead to a new sectarian conflagration, which could draw external anti-Iranian Sunni powers into the picture. A Sunni-led backlash against Maliki’s government — or against Tehran for that matter — is contrary to Iran’s interest in preserving a stable, democratic, and preferably Shia-led government.

Most importantly, Iran also has an interest in reducing the U.S. hold on Iraq. Given the hostile state of relations with the United States, Tehran has sought to undermine Washington’s efforts to create a pliable, pro-American Iraqi government, which could serve as an extension of American interests against Iran. Tehran used all its influence to convince Maliki to deny both the Americans and NATO forces any kind of judicial immunity against prosecution in Iraq, which in turn led to the collapse of any prospects for a permanent Western military presence in the country. The entire affair was a major diplomatic coup against the United States. The United States is instead forced to rely on its intelligence and diplomatic personnel to advance its interests in Iraq.

The Burgeoning Regional Duo

Iraq has also emerged as a major Iranian partner in regional affairs. Baghdad has been among the most vociferous opponents of any sort of sanctions, diplomatic censure, or military intervention against Iran. It has expressed its support for Iran’s purportedly peaceful nuclear program and continuously encouraged a diplomatic resolution to outstanding issues between Iran and the West.

As a member of the Arab League, Iraq has also refused to pressure, sanction, or isolate Syria – an important Iranian ally. Similar to Iran, Iraq is in favor of dialogue and cessation of violence. Citing fears of a potential humanitarian crisis flowing from neighboring Syria into its territories, Baghdad has sent a special envoy to convince the Assad-led regime to get the situation under control, mend relations with some elements in the opposition, and engage in substantive negotiations to avert an all-out civil war.

In light of the escalation of tensions between Iran and the West, Iraq has gained much more significance in Tehran’s strategic calculations. Diplomatically, Iran will seek Iraq’s continuous support in international bodies, from OPEC to the UN General Assembly. Economically, Iraq’s booming market provides Iran with some leeway in light of growing sanctions against its financial and trade sectors.

Most importantly, Iraq’s continued opposition to any military operations against Iran will provide Tehran with some semblance of security. Of course, Baghdad knows that any conflict in Iran would directly affect its own national security.

There is still a sizeable non-military American presence in Iraq, which could become a target of Iranian reprisal if Tehran comes under attack. Iraq is also crucial to any planned Israeli aerial attack against Iran’s nuclear installations. If pressured, Iraq may fire on Israeli jet fighters if they cross its territories on the way to Iran. Therefore, Iran will do anything to keep Iraq on its side and convince the Maliki government to dissuade America or Israel from conducting any military operations against Tehran.

The Long-Term Challenge

The greatest challenge for Iran is to retain a healthy and amicable relationship with both the Iraqi government and the greater Iraqi society. The last thing Tehran needs is to cultivate anti-Iranian sentiments among the Iraqi population, especially the moderate majority, by coming off as a meddling external power. Therefore, it is crucial for Iran to maintain a semblance of mutual respect and good will toward the Iraqi leadership.

Iran’s continued operations with Turkey against Kurdish insurgents in northern Iraq could embitter relations if Tehran does not properly coordinate with Baghdad. The strong cooperation of the Iraqi government is crucial if Iran seeks to continue its attempts to contain what it regards as a Western-backed Kurdish insurgency that is undermining its territorial integrity and national security, especially in light of the stream of attacks against Tehran’s military establishments, scientists, and nuclear facilities. For Iran, ethnic separatist movements in Balochistan and Kurdistan are a continuation of the shadow war between Tehran and the West.

In the end, Iran will need to rely on its soft power — from cultural influence to trade, investments, and educational cooperation — to keep Iraqi society on its side.

For its part, Iraq also knows that Iran — unlike America and other Western forces — is there to stay, and the most prudent approach is to maintain a peaceful and cordial relationship with its powerful Persian neighbor. So far, America’s full withdrawal from Iraq is a great testament to Iran’s strong relationship with and influence in post-invasion Iraq. After almost a decade of intense diplomatic and political jostling, the termination of American and NATO military operations in Iraq is Iran’s grand prize.

It remains to be seen whether America’s robust, permanent diplomatic presence in Iraq will be sufficient to counter Iran’s multifaceted, deep, and enduring

influence. Most crucially, as Washington increases its pressure on Tehran – from economic sanctions to oil embargos and sabotage activities – it should properly assess Iran’s ability to retaliate and decisively undermine U.S. interests in the region. Iran’s victory in Iraq is not absolute, but it is a glaring indication of Iran’s ability to outmaneuver its adversaries.

Foreign Policy In Focus contributor Richard Javad Heydarian is a foreign affairs analyst based in Manila. He can be reached at