But President Rouhani’s challenges, domestically and with the U.S. and Arab neighbours, are just beginning

After a difficult campaign, President Hassan Rouhani won a crucial second term in Iran’s presidential elections held on May 19. A high turnout of 73% helped him score a convincing victory over his principal challenger Ebrahim Raisi, a conservative cleric, in the first round itself, winning 57% of the votes compared to Mr. Raisi’s 38.5%. More than two-thirds of Iran’s voters are in urban areas and most of them are Rouhani supporters; therefore as voting hours got extended to midnight indicating a high turnout, the mood in the Rouhani camp turned jubilant.

A difficult campaign

In 2013, Mr. Rouhani had campaigned and won on a platform that focussed on bringing sanctions to an end, which he was able to achieve in July 2015 with the Joint Comprehensive Plan of Action (JCPOA), a nuclear agreement concluded with the P-5 + 1. The sanctions relief has had a positive impact on the economy with oil exports up and GDP growth hitting 6% last year though expectations were higher. In a TV debate in the run-up to the election, Mr. Raisi described the JCPOA as ‘a cheque that Rouhani had failed to cash’.

Opinion polls had favoured Mr. Rouhani, because Mr. Raisi, though close to the Supreme Leader, Ayatollah Ali Khamenei, was considered a relative newcomer to politics. However, concern grew when Mohammad Bagher Ghalibaf, a former Iranian Revolutionary Guards Corps (IRGC) pilot and the Mayor of Tehran since 2005, withdrew from the race in support of Mr. Raisi, who had spent most of his life in the judiciary before being appointed custodian of the shrine of Imam Reza in Mashhad last year. He also controls Astan-e-Quds Razavi, one of the wealthiest foundations, and is seen a possible successor to the present Supreme Leader who is 77 and in poor health.

Therefore Mr. Rouhani’s decisive victory is a shot in the arm for the moderates coming after the elections in February last year for the Parliament and the Assembly of Experts where the moderates and the reformists had registered significant gains.

Rouhani’s constraints

However, given Iran’s complex governance structures, President Rouhani will have to tread carefully as his powers and those of the directly elected 290-member Parliament are constrained by the non-elected authorities. The key power centre is the Supreme Leader who is appointed by the Assembly of Experts and in turn appoints the heads of radio and TV, the armed forces and the IRGC, the Supreme National Security Council, the 51-member Expediency Council and the higher judiciary. He also chooses six members of the powerful Guardian Council, with the other six nominated by the judiciary. The Guardian Council in turn vets candidates for all elections, presidential, parliamentary and the 88-member Assembly of Experts. It cleared only six candidates out of the more than 1,600 who filed nominations for the presidential contest; rejections included former President Mahmoud Ahmadinejad’s nomination. In addition, it approves all legislation passed by Parliament to ensure its consistency with Islamic jurisprudence. A dispute between Parliament and the Council is resolved by the Expediency Council. The Assembly of Experts is directly elected and its primary role is to appoint the Supreme Leader, critical during Mr. Rouhani’s second term.

Mr. Rouhani’s principal challenge will be to sustain economic growth and nudge the reform process forward in order to tackle unemployment, currently running at over 12%, and higher among the youth. He has promised to expand individual and political rights, enlarge women’s role and ensure greater accountability. Some of these will be challenged. While his victory margin is a clear endorsement for reform, the Supreme Leader will play a critical balancing role. It is interesting that, in his immediate remarks, he praised the Iranian people for the impressive turnout, but did not congratulate the winner.

In foreign policy, Mr. Rouhani will present the image of a moderate and more outward-oriented Iran. He is no stranger to Iran’s complex politics. From 1989 to 2005, he was Secretary of the Supreme National Security Council, reporting to the Supreme Leader, and handled the nuclear negotiations during 2003-05. During this period, he also served a term each as Deputy Speaker of Parliament and as member of the Expediency Council. Following Mr. Ahmadinejad’s election in 2005, he quit. After being elected in 2013, he persuaded the Supreme Leader to shift responsibility for the nuclear negotiations to the Foreign Ministry and let Foreign Minister Mohammad Javad Zarif take the lead.

In addition to managing his home front, the other challenge for Mr. Rouhani will be keep the JCPOA going in the face of the U.S. Congress’s and now President Donald Trump’s declared hostility.

Dealing with Trump

During the election campaign, Mr. Trump had called it the ‘worst deal ever’ and threatened to tear it up as soon as he was elected! Subsequently, he seems to have modified his position, realising perhaps that it is not just a bilateral agreement with Iran but also includes Russia, China, the U.K., France, Germany and the European Union. In April, the Trump administration certified that Iran was abiding by its obligations but Secretary of State Rex Tillerson added that a 90-day policy review would be undertaken in view of ‘Iran’s alarming ongoing provocations’.

More recently, on May 17, the Trump administration continued the sanctions waiver (under Section 1245 of the National Defense Authorization Act 2012), needed every 120 days even while imposing sanctions on seven Iranian and Chinese individuals and entities on account of missile proliferation activities. In April, a slew of human rights related sanctions were imposed. In mid-June another waiver, this time under the Iran Freedom and Counter-Proliferation Act, will need to be renewed if the JCPOA is to be sustained. These are necessary because in 2015, the Republican-dominated Congress rejected the JCPOA and U.S. President Barack Obama used executive authority to waive U.S. sanctions but these waivers need to be renewed periodically.

The JCPOA was the outcome of protracted negotiations over more than a decade, during which Iran had steadily built up its nuclear capabilities, especially in the enrichment domain, and in 2015 was estimated to be only months away from acquiring enough Highly Enriched Uranium to produce one device (approximately 25 kg) though Iran consistently maintained that its programme was exclusively for peaceful purposes. Given deep suspicions however, the JCPOA with its extensive inspection and reporting obligations was the best way to prevent Iran from developing a military nuclear capability for the next 10-15 years. Opponents say that while cheating is unlikely, they fear that Iran will retain its nuclear appetite after abstaining during the 10-15 year period and resume its activity once the inspection obligations expire.

The Saudi factor

Perhaps the most troubling problem is the new embrace of Saudi Arabia that was in evidence during Mr. Trump’s visit. It raises the prospects of greater U.S. involvement in the war in Yemen and can push relations with Iran into a confrontation. In 2016, there were 19 ‘incidents at sea’ between U.S. and Iranian vessels in the Persian Gulf. The most serious was in January 2016 when the IRGC held two U.S. vessels and 10 servicemen, accused of trespassing in Iranian waters. The crisis was resolved within hours, thanks to some quick phone conversations between U.S. Secretary of State John Kerry and Mr. Zarif. That link is missing today.

It is all the more ironic because Iran is the one country that is opposed to the Islamic State. Yet the U.S. is keener to bless the Saudi-created Islamic Military Alliance to Fight Terrorism, a grouping of 41 Sunni nations, under the command of former Pakistani Army Chief, General Raheel Sharif. It remains unclear what the role of this coalition is, to fight the IS or Iran or in Yemen, or to secure the Gulf monarchies!

For the last quarter century, the U.S. practised dual containment of Iran and Iraq, a policy that suited both Israel and Saudi Arabia. Mr. Obama’s push for the JCPOA was driven by a desire to extricate U.S. policy from this stranglehold and expand options. If a return to the Saudi embrace creates additional tensions and a collapse of the JCPOA, it could push Iran to cross the nuclear threshold with much wider regional implications. Mr. Rouhani’s challenges are just beginning.

Rakesh Sood is a former diplomat and currently Distinguished Fellow at the Observer Research Foundation. E-mail: rakeshsood2001@yahoo.com