Navigating Through the Proposed Iran Nuclear Deal

This is my take on the recently concluded negotiation between the Obama- administration led six super powers ( P5+1 - The US, China, Russia, The UK, France, and Germany) and Iran. At the core of a broader discussion is if this negotiation is transformative in nature; or, just another transactional development credited to the Obama administration. The joint Comprehensive Plan of Action is fairly complicated, with 100 plus pages of text.

I am cautiously optimistic about this deal. If inspection clauses are structured properly, the measures proposed in the deal could set a strong precedent in the region - as Iran being a reliable collaborator, innovator and a job creator in the region.

As the Secretary of State John Kerry said, “Over 15 years, things happen in countries, and if you look at Iran today, very educated, used to be very friendly with a lot of nations in the region, including Israel. There’s a long history with Persia. And the reality is that those young people, who are 20 percent unemployed, want a future.”

The agreement is headed to the congress. We must make sure that we dot the i’s and cross the t’s. If the congress does not approve of the agreement, the deal is likely to be vetoed by the President. I am optimistic that at least this debate in the media and among representatives of the American people should further clarify the logistics and the structure of the plan.

The polarizing pre-conceived judgement of the Iran deal based on limited information could harm us as a society. I am a strong believer that we should do the right thing and not make up our minds before understanding the details and the context in which the negotiation has taken place. Going for this deal because of lack of alternatives; or, not liking the deal from the get-go because of not liking the President – in either case, is not rationally acceptable.

This is a unique time in history that both Iran and P5+1 can benefit from this deal. The economy of Iran has suffered as a result of the decades of sanctions; and, the US businesses in particular were kept out of a very large market in the region.

The mistrust that the American people have about Iran is not totally unfounded. Critics are concerned that, though Iran has signed treaty with the International Atomic Energy Agency (IAEA), the leading International body created to promote nuclear co-operation, there is a fundamental mistrust in the Iranian government and leaders.

Iran’s newly elected President Hassan Rouhani is slightly moderate (though, by not much), among his opponents in the Presidential election. This is a unique opportunity for Iranian leadership to seize the opportunity and create a long term vision for the region, and show the world that Iran is ready to be a part of the global economy - by making strong social reforms. The process starts with building trust. It is in the best interest for Iranian leadership not to blow the deal.

According to preliminary agreement reports, in the event of violation of the treaty, the ‘snap back’ deal shall immediately impose sanctions back in place; and, the decision can be made unilaterally by the United States. The twenty four day waiting period prior to allowing inspectors on nuclear sites may pose a concern; but, placing strong measures to keep track of supply chain and procurement processes could minimize the cheating that could take place.

A healthy Iran is not a threat for the United States; however, there is a concern that this could pose threat for Israel. It is important to note that Israel of 2015 is very different from Israel of ‘80s and ‘90s. Israel’s economy is extremely strong, with healthy sustainable entrepreneurial ecosystem. Israel also has a large defense budget. For a population of just over 8 million people, Israel’s defense budget is in excess of 23 billion dollars (7% of its GDP) according to IISS.org, compared to Iran’s defense budget of 30 billion dollars (with population of over 77.4 million, according the World Bank 2013 data). Israel is getting powerful to be able to defend itself. Nuclear Iran will be undeniably big threat for both the US and Israel; but, in my opinion, that healthy Iran should be tolerable, if not strongly leveraged.

In the conceptual economy, we live in a changing world that is shying away from zero sum outcomes. The transformation will not be flawless. There is a risk of a stronger Iran misusing funds for wrong purposes like supporting militia organizations like Hamas and Hezbollah. I am optimistic that we will get a clearer picture in coming days, to mitigate relatively smaller setbacks and challenges along the way; and, will make sure that Iran will not become a weapon-grade nuclear power.