Select Committee on Foreign Affairs Written Evidence


Memorandum submitted by Dr Ian Davis, Co-Executive and Paul Ingram, Senior Analyst, British-American Security Information Council

EXECUTIVE SUMMARY

  BASIC's primary objective in following the Iranian nuclear file has been to promote non-proliferation. Along with the UK government, we share the crucial objective of preventing proliferation of nuclear weapons, and see the denial of a nuclear weapon capability by the Iranian government as central to this. Our problem with UK government policy is that it contains important elements that are self-defeating in this regard. We recommend that the UK government:

    —  Ditch preconditions and take up Iran's offer of "serious talks", starting with a genuine attempt to define the interests of all the key players involved;

    —  Identify common ground with P5+1 partners and Iran, and isolate areas of conflict in order to formulate compromise proposals;

    —  Give serious consideration to either the Forden-Thomson plan for a multilateral enrichment facility on Iranian soil or for a pilot enrichment facility at Natanz under an intrusive IAEA inspection regime;

    —  Work towards the publication of an agreed UN Security Council document on the security risks of the different technologies being developed by Iran, in order to prioritise proposals and demands accordingly, and search for common solutions; and

    —  Develop the proposals offered by the P5+1 on 6 June 2006 into concrete offers to Iran in return for tighter inspections and abandoning all ambitions towards reprocessing (as offered by the Iranians in 2005).

  In addition, the UK government should seek to influence the United States, Israel and Iran to enter into mutual security guarantees, as part of a regional security system. The P5, including Britain, should consider their own deployment of nuclear weapons and engage more seriously in furthering the multilateral disarmament commitments made at the 2000 NPT Review Conference. In the case of the UK, it is not too late to reconsider the timing of its own upgrade programme for Trident.

THE BRITISH AMERICAN SECURITY INFORMATION COUNCIL (BASIC)

  BASIC is an independent research and advocacy organisation that analyses government policies and promotes public awareness of defence, disarmament, military strategy and nuclear policies in order to foster informed debate. BASIC has offices in London and in Washington and its governing Council includes former US ambassadors, academics and politicians. Further information is available on our website: http://www.basicint.org

Contact Details: BASIC, The Grayston Centre, 28 Charles Square, London N1 6HT;

email: idavis@basicint.org Tel: 020 7324 4680

1.  INTRODUCTION

  1.1  Iran claims that its development of nuclear power is benign, but like the International Atomic Energy Agency (IAEA), we are not yet convinced that this is the case. Iran's previous cooperation with international inspections has helped to build some confidence, but it remains uncertain whether Tehran is seeking to acquire a threshold nuclear weapons capability. International concern is justified by Iran's past concealment of important parts of its nuclear programme (such as the Natanz uranium enrichment facility) and the unacceptable rhetoric towards Israel by President Ahmadinejad.

  1.2  The case of Iran highlights a crucial loophole in the international non-proliferation regime due to the unavoidable dual-use nature of the technologies involved in the production of fuel for nuclear power, and in the disposal of waste from the back-end of reactors. A country can perfectly legally acquire foreign technical assistance under safeguards for its civil programme that will also give it a capability to develop nuclear weapons in a short period. Countries with highly-advanced nuclear programmes, such as Japan, Germany and Canada are already in this position. Iran is probably well on the way to achieving this.

  1.3  We strongly agree that the acquisition of nuclear weapons by Iran or any other non-nuclear weapon state would be destabilizing and dangerous and must be avoided. However in our judgement the current strategy of the UK, EU and the United States is unlikely to achieve this important objective. The combination of coercive diplomacy, sanctions and conditional engagement has created a stalemate that Iran is exploiting to continue to advance its nuclear programme.

  1.4  This paper addresses most of the remit outlined by the Foreign Affairs Committee when launching this inquiry, but focuses in particular on the international engagement with Iran on nuclear matters, some of the unintended consequences of the strategy, and alternative options that have been articulated by a number of analysts, but neglected in the negotiations.

2.  EXTENT OF IRANIAN NUCLEAR DEVELOPMENT

  2.1  An accurate technical assessment of Iran's nuclear programme is essential to framing an appropriate response. Misjudging the nature of the threat could lead to an over or under reaction, either of which could prove costly.

  2.2  Uranium enrichment, as practiced by Iran, involves acquiring the feedstock, uranium hexafluoride (UF6), and then spinning the UF6 in gaseous form at super-sonic speed in centrifuges. This process separates streams of uranium with minutely different concentrations of the fissile isotope U-235. Fed several times through cascades of centrifuges the concentrations can be increased gradually over time. Uranium enriched to 3% to 5% U-235 is used as the basic material for fabricating fuel rods for standard power reactors, and is known as low-enriched uranium (LEU); uranium enriched to more than 70% U-235 is used for bombs or special varieties of reactor, and is termed highly enriched uranium (HEU). Additionally, when LEU fuel is burned in a nuclear energy reactor, some of the uranium is converted into plutonium, the material of choice for military purposes for most weapons programmes. This plutonium can be chemically separated from the spent fuel using specialised plutonium reprocessing facilities.

  2.3  Under Article IV of the Non-Proliferation Treaty (NPT), all States Parties have the "inalienable right to develop research, production and use of nuclear energy for peaceful purposes without discrimination and in conformity with Articles I and II". Also under Article IV, all states have "the right to participate in the fullest possible exchange of equipment, materials and scientific and technological information for the peaceful uses of nuclear energy". Thus a party to the NPT in good standing is allowed the means to produce HEU and plutonium—key nuclear weapons ("fissile") materials that also have commercial uses—and stockpile them without limit as long as they are placed under IAEA safeguards.

  2.4  While exact quantities are unknown, estimates put the global total quantity of fissile material at more than 3,700 metric tons, enough for hundreds of thousands of nuclear weapons, in about 50 countries. This stockpile grows each year, along with the difficulty of ensuring that such material is not diverted. In short, the development and global spread of nuclear power as a source of energy makes it more likely that materials are diverted into nuclear weapons programmes.

  2.5  Worries about dual-use enrichment and reprocessing technology are not new and received much attention in the 1970s, soon after the NPT was signed. However, Iran's pursuit of a broad nuclear technology programme, and nuclear weapons developments in India, Iraq, Libya, North Korea and Pakistan (all of which involved the use of civil nuclear energy as cover), have prompted many states to re-think the basic nuclear technology bargain.

  2.6  The balancing of rights of States Parties to have nuclear technology (under Article IV of the NPT) while addressing the proliferation threat posed by the development of such technology has been a key issue for the international community in recent years. Proposals have included Mohamed ElBaradei's idea of internationally-controlled facilities for the enrichment and stockpiling of LEU for power reactors. But while attention has been drawn to the dangers involved in the widespread proliferation of uranium enrichment and plutonium reprocessing technology, there is as yet no international consensus on how to deal with the problem.

  2.7  Iran's nuclear efforts have their origins in the late 1960s under the late Shah Reza Pahlavi. Iran ratified the NPT in 1970 and concluded a comprehensive safeguard agreement (CSA) with the IAEA in 1974. After the 1979 revolution the new Islamic Republic was placed under a virtual embargo on the provision of nuclear technology and equipment from the West. In any case, at least initially, the Islamic Republic had no interest in the technology. These Western restrictions on nuclear technology to Iran have continued to the current day, although the concerns that underpin them have rarely, if at all, been universally shared. China and Russia, and members of the Non-Aligned Movement, in particular, have generally adopted a more supportive position towards Iran.

  2.8  Iran's nuclear efforts restarted in earnest in the late 1980s during the country's eight-year war with Iraq. Design information and technical assistance for the construction of uranium conversion facilities and centrifuges were acquired from China and Pakistan in the mid-1990s, and Russia began to provide assistance for the reconstruction of a 1,000-megawatt power reactor at Bushehr, started and almost finished in the 1970s by a German firm. Iran also began another secret programme to eventually reprocess the plutonium produced by this and other reactors.

  2.9  A combination of steep technical challenges and uneven support within Iran's governing elites meant that progress on all of these programmes was initially slow, but accelerated significantly after 2000. Disquiet was heightened considerably in August 2002, when construction of secret underground uranium enrichment facilities at Natanz and heavy water production facilities at Arak were exposed. Both of these processes are dual-use and could be used in civil or military programmes. This sparked an intensive round of discussions and inspections by the IAEA in February 2003. In his report of November 2003 to the IAEA Board of Governors, Mohamed ElBaradei stated that "it is clear that Iran has failed in a number of instances over an extended period of time to meet its obligations under its Safeguards Agreement" and "in the past, Iran had concealed many aspects of its nuclear activities, with resultant breaches of its obligation to comply with the provision of its Safeguards Agreement". Keen to regain its good standing, Iran initially cooperated with the IAEA inspections in most respects and agreed in December 2003 to sign and act by the terms of an Additional Protocol (AP), although the Iranian parliament did not ratify it. However, as shown by the timeline in Table 1, the crisis eventually spiralled out of control and culminated in the Iran dossier being referred to the United Nations Security Council (UNSC).

Table 1

TIMELINE TO A CRISIS

Aug 2002An Iranian opposition group discloses the secret construction of an underground uranium enrichment facility and a heavy water production plant at Natanz and Arak respectively
Feb 2003Intensive IAEA inspections commence that lead to regular verbal and written reports by Dr. El Baradei, IAEA Director General, to the 35-member Board of Governors, outlining Iranian experiments that had not been declared in accordance with their obligations under its CSA
Sept 2003IAEA Board gives Iran weeks to prove that it does not have a nuclear weapon programme
Oct 2003E3 Foreign Ministers (UK, France and Germany) visit Tehran and announce a set of measures to bring Iran back into compliance
Nov 2003Iran starts a voluntary suspension of its uranium enrichment program, allows stricter IAEA inspections under an Additional Protocol, and the IAEA Board concludes that there is no evidence of a nuclear weapons programme
Nov 2004Paris Agreement: Iran agrees with the E3 to continue its suspension of all activities related to enrichment, and all parties to negotiate towards "objective guarantees" that Iran is not pursuing nuclear weapons. Iran states it will not permanently stop conversion and enrichment activities
May 2005NPT Review Conference in New York fails to agree any substantial measures to tackle proliferation
Aug 2005Iran claims that the E3 are playing for time in the negotiations, and restarts its uranium conversion process. The E3/EU submit a proposal which is rejected out of hand by Iran. The case is discussed in an emergency IAEA Board which urges Iran to stop its conversion activities
Sept 2005IAEA Board finds Iran in violation of its non-proliferation obligations and agrees that it is a matter under the remit of the UNSC but does not refer the case. Although decisions within the IAEA are normally taken by consensus—in the past 20 years there have only been two instances in which the IAEA board has not done so—the EU-US inspired decision not to refer the matter to the UNSC was forced through on a majority vote of 22 to one (Venezuela) with 12 abstentions
World Summit fails to reach agreement on any nuclear disarmament statement
Oct 2005UK alleges that Iran is assisting insurgents in southern Iraq by supplying sophisticated bombs. Tony Blair strongly condemns a statement made by Iranian President Ahmadinejad that Israel should be wiped off the map, and alludes to threats of military action
Nov 2005Increased speculation that the Iranians are prepared to compromise on enrichment if they were allowed to develop uranium conversion within Iran
Jan 2006Iran announces the resumption of nuclear research activities, and removes some of the IAEA seals on its plants
Feb 2006Iran tells the IAEA that it is resuming full-scale uranium enrichment. Kofi Annan urges Tehran to return to the negotiating table. On 4 Feb the IAEA board passed a resolution requesting the IAEA Director General to report to the UNSC all IAEA reports and resolutions relating to the implementation of safeguards in Iran
8 March 2006  IAEA refers the Iran nuclear dossier to the UNSC
29 Mar 2006UNSC gives Iran until April 28 to suspend enrichment
Apr 2006Iran begins military manoeuvres in Gulf; world oil prices jump by almost two dollars on the news
May 2006Following Iran persisting in its nuclear activities after the April 28 deadline, Britain and France introduce a UNSC resolution to set the stage for possible sanctions against Iran if it does not abandon uranium enrichment;. France, Germany and the UK offer Iran a light-water nuclear reactor as part of a package of incentives; Ahmadinejad rules out halting nuclear fuel work in return for EU incentives
June 2006EU foreign policy chief Javier Solana presents Iran with a package of incentives (agreed by the P5 + Germany) that requires a suspension of Iran's enrichment programme as a pre-condition for further talks—5 July set as the deadline for an Iranian response
31 July 2006UNSC passes Resolution 1696 giving Iran until 31 August to suspend uranium enrichment or face the threat of economic and diplomatic sanctions. The resolution passes by a vote of 14-1. Qatar, which represents Arab states on the council, casts the lone dissenting vote.
31 Aug 2006UN deadline for Iran to stop enriching uranium passes
23 Dec 2006UNSC unanimously passes Resolution 1737 banning the supply of specific nuclear materials and technology to Iran, and freezing the assets of individuals and companies linked to Iran's nuclear programme. The resolution also specifies that if Iran fails to suspend nuclear enrichment, further non-military sanctions may follow.
24 Mar 2007UNSC unanimously adopts Resolution 1747 to tighten the existing sanctions and impose a ban on arms sales. Further steps promised if no compliance within 60 days
23 May 2007IAEA report confirms that Iran has failed to suspend its enrichment related activities. Although the IAEA is "able to verify the non-diversion of declared nuclear material in Iran" it remains "unable to make further progress in its efforts to verify certain aspects relevant to the scope and nature of Iran's nuclear programme".


  2.10  Today, the IAEA is still unable to verify that there are no additional undeclared materials or activities in Iran. But neither has it found evidence of a "smoking gun" that would confirm an illicit nuclear weapons programme. Prior to the US-led invasion of Iraq, neoconservative political commentators seized on statements by Hans Blix that he was unable to say with certainty that Iraq had not violated the 1991 UNSC resolution to disarm, which they then spun as proof that Iraq was guilty. The same spin is happening with respect to Iran today.

Conclusions

  2.11  All the evidence suggests that Iran remains in the early stages of perfecting uranium enrichment and its effort to develop an indigenous plutonium-separation capability is much less advanced, though in the long term could be more important to any nuclear weapon capability. Iran's declared enrichment programme, which is based on relatively primitive P1 gas centrifuge technology acquired via the A.Q.Khan network, continues to face technical obstacles that could take several years to resolve before a reliably smooth industrial-scale operation is achieved.

  2.12  The most recent IAEA report (following inspections at the plant in April and May this year as part of a new agreement between Tehran and the IAEA that allows "a combination of unannounced inspections and containment and surveillance measures" to improve transparency at the facility) said Iran had started up 1,312 centrifuges, divided into eight cascades, or fuel-cycle networks. This is part of an accelerating campaign to lay a basis for "industrial scale" enrichment (50,000 centrifuges) in the Natanz complex. Iran has doubled the number of centrifuges in Natanz in the past two months and says publicly that it aims to have 3,000 running by the end of May.

  2.13  While 3,000 centrifuges running for long periods without breakdown could be enough produce enough fissile material for one nuclear bomb within a year, Iran has yet to demonstrate such proficiency.

  2.14  A facility operating, as proposed, with 50,000 reliable P1 centrifuges could potentially produce enough HEU for dozens of nuclear weapons a year, although Iran claims that it will only produce LEU under safeguards for the Bushehr reactor. The consensus judgement of the US intelligence community, according to published accounts of the classified May 2005 National Intelligence Estimate (NIE) on Iran's nuclear programme, is that Iran is five to ten years away from the ability to produce indigenously enough HEU for a bomb. Director of US National Intelligence John Negroponte restated that timeline in September 2006. As this timeline anticipated these recent developments it would seem that the judgement still stands. Indeed, Mohamed ElBaradei more or less confirmed this at a press conference in Luxembourg on 24 May 2007: "I tend, based on our analysis, to agree [with US assessments] that even if Iran wanted to go for a nuclear weapon, it would not be before the end of this decade or sometime in the middle of the next decade. In other words, three to eight years from now". However, he also said the agency had seen no evidence that Iran was trying to "weaponise" nuclear material or of undeclared nuclear facilities operating in the country.

  2.15  These estimates are based on "worst case" analyses, whereby Iran overcomes all the major technical obstacles and runs the centrifuges at optimal levels. While it appears that Iran has overcome some of the obstacles that have slowed down its programme considerably in 2006 and the early months of 2007, progress is still slower than might otherwise be expected. IAEA reports, for example, indicate that Iran's experiments with its first two 164-machine cascades used to enrich small amounts of uranium in 2006 met with limited success and only operated for a few days at a time. In November 2006, the IAEA reported that between August and November that year Iran enriched 34 kg of uranium to levels below 5%.

  2.16  Iran continues to claim that it has not enriched uranium beyond low levels, and that it has no intention of doing so. Yet Iranian nuclear scientists do not appear to be in any hurry to produce nuclear fuel, after all the country has no fuel manufacturing plant for a Light Water Reactor (LWR) fuel assembly, and no finished reactor to load. The facility also continues to be safeguarded by the IAEA. The fear is that by building up a stock of LEU Iran could be developing the capability of rapidly manufacturing HEU, simply by reintroducing the material back into the centrifuge cascades.

  2.17  Of course, on current trends, in time Iran will soon master the technology that will in future enable it to enrich uranium at any grade. Based on public sources, it is still unclear when Iran will cross this threshold, but the latest May 2007 IAEA report suggests that it may have already done so. Mohamed ElBaradei is quoted in the New York Times on 14 May 2007 as saying: "We believe they pretty much have the knowledge about how to enrich. From now on, it is simply a question of perfecting that knowledge. People will not like to hear it, but that's a fact."

  2.18  If Iran is able to sustain this recent progress it raises the possibility (as stated above) of Iranian nuclear scientists being able to enrich enough uranium for a nuclear weapon within one year. But it would be unable to do this using its declared facilities at Natanz without the international community having considerable warning of its intentions. It would then have a number of additional barriers to surmount, not least in designing a warhead, and in miniaturising it sufficiently to fit atop of their missiles. Thus, a working nuclear weapon remains at least five years down the line.

  2.19  However, there are also enough "known unknowns" that the possibility of Iran achieving a surprise breakthrough cannot be excluded. This could happen, for example, if Iran: (a) has a parallel, secret and more advanced enrichment capability; (b) steals or diverts an alternative source of HEU from one of the many stockpiles located around the world; or (c) acquires fissile materials or a complete nuclear weapon from another government, such as Pakistan or North Korea.

  2.20  A credible UK policy towards Iran must take steps to hedge against one of these eventualities, but uncertainty is a double-edged sword. It is also possible that circumstances arise that limit the rate of progress in Iran's nuclear programme. Such factors include: the enrichment technology proving too difficult or expensive; the denial of key components as a result of UN sanctions; and political divisions within Iran exacerbating management problems in the nuclear programme.

  2.21  Bottom line: if Iran is determined to perfect uranium enrichment and build a nuclear weapon it will eventually do so. Sanctions, censure, export controls, and economic and technological problems have slowed down past efforts, such as those in Argentina and Brazil, allowing time for internal changes in governments to reverse previously resolute decisions to proceed with nuclear programmes. Could that happen in Iran, too? That question is discussed in sections 5 and 6 below.

  2.22  The May 2007 IAEA report also said Iran had stopped letting inspectors verify design work at the Arak heavy water reactor (HWR), under construction and scheduled for completion in 2009. This is a major proliferation risk as it could be used to produce plutonium, although Iran says it has only peaceful purposes such as production of radio-isotopes for medical care. Plutonium has been the fissile material of choice for most weapons programmes, as it requires only a few kilogram's for a weapon, making the warhead lighter and easier to deliver. If Iran did intend to produce plutonium for a bomb, it will also require a specialised plant for extracting the plutonium from the spent fuel. Iran has told the IAEA that it has no plans to build such a facility and it may be difficult to build one clandestinely, one that could receive and process the spent fuel rods without detection. Reprocessing facilities could be on a smaller scale, and therefore easier to hide, than an enrichment plant. Nonetheless, Arak has been overlooked in the West's rush to close the uranium enrichment route. The international community needs to act fast to secure an agreement with Iran to abandon facilities at Arak before significant investment raises the costs of closure.

3.  IRAN'S SECURITY SITUATION AND ITS NUCLEAR AMBITIONS

  3.1  Public pronouncements by UK, EU and US policymakers and "opinion shapers" too often fail to reflect that Iran is a complex country. While there are clearly highly reactionary elements within the Iranian government and the state apparatus is used to perpetuate human rights abuses, the country has a rich culture and history, containing people with technological, economic and political aspirations and understandable fears of foreign attack. A limited vision can only feed tensions between Iran and the West. The current nuclear dispute is not the cause, but a symptom, of a failed relationship. It is this relationship that must, in the long-term, be improved if further political crises like the present one are to be avoided.

  3.2  Iran's nuclear ambitions are being fed by a combination of US threats of regime change, domestic politics and regional security concerns and aspirations. It is widely recognised that Iran has become more influential in the Middle East since the elimination of two regional rivals (the Taliban in Afghanistan and Saddam Hussein in Iraq). The Iranian regime actively cooperated with the United States in Afghanistan but felt threatened by US rhetoric, including President Bush's 2002 State of the Union address in which Iran—along with Iraq and North Korea—were described as part of an "axis of evil". From the Iranian perspective, the United States is a hostile power that, together with the UK, fomented the 1953 coup against the democratically elected Mohammed Mossadeq, continues to support domestic groups hostile to the regime (including violent action), and refuses to recognise the Islamic Republic.

  3.3  The Iranian President Mahmoud Ahmadinejad's populist, pan-developing world approach to the nuclear issue has raised his international profile and cultivated nationalist sentiments at home. For many Iranians, therefore, relinquishing the right to nuclear technology under the NPT would be seen as a national humiliation. Neither reformists nor conservatives appear willing to contemplate such a move. Iran has a history as a regional power, and its nuclear advances serve as a symbol of Iran's political importance and its modernity.

  3.4  If, as existing nuclear weapon states argue (including the UK government in deciding to renew Trident), such weapons confer status and provide security through "deterrence," some factions in Iran might indeed find the prospect of obtaining nuclear weapons attractive. The country is situated in a war-plagued region (five major wars in less than 25 years). When Iraq attacked Iran in 1980, subjecting it to the most extensive use of chemical weapons since the First World War, the international community turned a blind eye. The conflict cost the lives of hundreds of thousands of Iranians and remains a major scar on the national psyche to this day. Iran is located between two regional nuclear weapon states (Israel and Pakistan), and is encircled by US military forces in Iraq, Afghanistan, Turkey, Kuwait, Qatar, Diego Garcia and Kazakhstan, as well as naval forces in the Gulf.

  3.5  Views among the Iranian political elite are mixed as to whether or not Iran should build a nuclear bomb, although senior religious and political leaders have made public declarations that this is not their intention. As discussed above, the most likely scenario is that Iran is positioning itself to establish a "virtual" or "breakout" nuclear weapon capability—namely, the ability to manufacture a nuclear device within a short period of time by virtue of its non-military nuclear technical capabilities and assets. This "breakout" option would put Iran on a par with a number of Non-Nuclear Weapon States under the NPT, such as Brazil and Japan, although unlike Iran, these countries remain in good standing with the international community and the IAEA.

  3.6  There appears to be a growing consensus among Iranian elites that mastering uranium enrichment and securing such a "breakout" capability could enable Iran to achieve several key goals of paramount importance, including: deterring US interference in Iran's internal affairs; consolidating Iran's regional status as a leading power; and sustaining Iranian nationalism and support for the current regime. The UK, EU and US face a major challenge in seeking to help Iran satisfy these goals without recourse to a nuclear weapons capability, especially given that certain aspects of current US policy are directly apposite to these goals. It might also be the case, however, that some of these key Iranian goals can be modified in the light of a new approach by the Western powers—as discussed in Section 6 below.

4.  SECURITY IMPLICATIONS OF IRAN'S NUCLEAR PROGRAMME

Is a nuclear weapon capability the ultimate goal?

  4.1  The assumption that Iran's nuclear programme is a cover to achieve a nuclear weapon capability is so widespread within the Western analyst community that it is often taken as read. It means that success in the strategy pursued by Western states in the stand-off can be measured simply in terms of preventing Iran acquiring, openly or illicitly, any dual-use technologies that will inevitably contribute to this budding capability; hence the emphasis on insisting on a suspension of enrichment prior to any negotiation.

  4.2  But such an assumption needs to be treated with caution, particularly in the light of the Iraq experience, when assumptions made prior to the 2003 Iraq war that Saddam Hussein had developed useable WMD were found to be entirely without foundation. It is easy today to forget how widely held these assumptions were, even by a majority of those opposed to the war. That is not to say that Iran is not looking to develop a nuclear weapon or "breakout" capability; indeed we at BASIC believe the evidence, though circumstantial, does point in this direction. We recommend, however, proceeding with caution.

  4.3  The legitimacy of international action to stem the tide of nuclear proliferation hangs on the actions of the international community in regard to Iran's nuclear programme. Too soft, and in the light of North Korea's testing of a nuclear explosive device, other potential proliferators may be emboldened to plough ahead. Too strong, and the non-proliferation regime could be equally badly affected, as developing countries in particular begin to lose faith in its central bargain: states without nuclear weapons pledged not to acquire them, but were free to pursue the peaceful use of nuclear technology under strict and verifiable control, while nuclear-armed states committed to eventually give them up. And there is a widespread and growing perception among States Parties to the NPT that the freedom to pursue peaceful use of nuclear technology is under threat and that the nuclear weapon states are failing to honour their disarmament commitments. If not addressed, this situation is a recipe for disaster: it will probably lead to a more unstable world of 20 or more nuclear weapon states.

  4.4   While it is prudent to be strongly concerned about Iran's potential "breakout" capability, it is equally prudent to be open to the possibility that Iran may simply be seeking self-sufficiency in its civilian programme. The Iranian people do, after all, have plenty of reason to desire this self-sufficiency, having been let down several times when collaborating internationally in the nuclear field. For example, Iran remains a shareholder in Eurodif, which was formed in 1973 by five countries including Iran, to provide assured supplies of enriched uranium from a single facility based in and run by France. The company now supplies around eight million separative work units (SWU) of enrichment services worldwide, beyond its original partners. In the 1970s Iran lent Eurodif $1 billion and purchased $180 million of services from the company. After a bitter legal battle, Iran was partly compensated for its loan in 1991, still part-owns Eurodif indirectly, but has yet to see delivery of any material. France simply refuses to export it.

  4.5  Russia's more recent dispute with Iran over completion of the Bushehr reactor and the delivery of fuel has exacerbated doubts among Iranians as to the reliability of Russian supplies. Proposals that Iran rely upon Russian enrichment facilities for the supply of its nuclear fuel were never really the silver bullet some thought it might be.

  4.6  Thus, any proposals that involve Iranian dependency upon foreign sources of nuclear fuel, even if there are apparent guarantees, are not going to curry strong favour in Iran. This lack of enthusiasm for foreign fuel supplies does not in itself indicate an Iranian desire to control the enrichment processes for military purposes. Neither does the pursuit of a strong nuclear power industry while sitting on large oil and gas reserves—a state of affairs that is often cited in the Western media as a reason for questioning Iranian motives. Iran faces a different energy security calculation than states dependent upon energy imports, but is heavily reliant on foreign exchange income from energy exports and has a burgeoning domestic demand for energy. Iran's failure to develop significant sources of renewable energies or engage seriously with energy conservation may be lamentable, but the country is not alone in falling short in this regard.

  4.7  The concealment of sensitive nuclear technologies for 17 years provides stronger grounds for mistrusting Iranian intentions, although, again, there are some credible explanations for their uncompromising behaviour. Given Iran's technological isolation and distrust of its neighbours, it is perhaps not surprising that it would seek to conceal its nuclear activities for as long as practicable. Iran would have been concerned about espionage and foreign interdiction of imports of critical technologies. There is a conflict of interpretation over Iran's need to inform the IAEA about the extensive facilities it was constructing, though the IAEA is clear and explicit in stating that it broke the Safeguards Agreement in failure to report on key sensitive experiments. IAEA reports have explicitly censured Iran for failing to declare many aspects of nuclear fuel cycle activities, particularly in the areas of uranium enrichment and conversion, and plutonium research. However, the IAEA also acknowledge that Iran has taken some corrective actions since October 2003 and the Agency has verified some of Iran's declarations.

  4.8  A similar defence can be made of Iran's networks of clandestine supply. The Iranians believe that open procurement of nuclear technologies would be blocked, irrespective of whether they were for legitimate civilian or for military purposes (something which is, as discussed earlier, difficult to establish either way). The formal and informal nuclear sanctions applied against Iran, along with clandestine interdiction and disruption, forced them to acquire nuclear technologies, legitimate or otherwise, from the black-market if they were to develop an indigenous power industry. They used underground suppliers like A.Q. Khan who sometimes had more to offer than simply civil or dual-use technologies. Iran's receipt of blueprints for nuclear weapon designs from the A.Q. Khan network quite rightly rang alarm bells. Attention has focused on a 15-page document supplied by the network, that Iran claims it did not request, that provides partial information on the process of reducing enriched uranium hexafluoride into a solid metal and casting it in metal spheres. This is a process that is only useful for military purposes. The document has been inspected by the IAEA and is under their seal, but Iran has refused to allow the Agency to take a copy. There is no evidence that Iran has used this document in any way.

  4.9  Another cause for concern, the IAEA's discovery of enriched uranium particles, is explained away as having originated with the equipment supplier. By and large, the IAEA has accepted this explanation, though the Agency has been unable to confirm this with any certainty. Iran has also been unable to supply full information on its imports of centrifuge parts and related technologies, and this remains the main outstanding issue with the IAEA. Questions are also outstanding on a number of small-scale plutonium reprocessing experiments that may have been undertaken by Iran.

Security implications from an Iranian nuclear weapon

  4.10  An important recent study (April 2007) by Anthony Cordesman, at the Center for Strategic and International Studies (CSIS) in Washington DC, looks at possible scenarios arising from Iranian development of a nuclear arsenal. Two important conclusions are: (a) Iran will remain much more vulnerable than Israel, given significant and lasting Israeli superiority in strategic, including nuclear, forces; and (b) a combination of active and passive defences deployed by Gulf States, operating alongside US extended deterrence, is likely to entirely neutralise any advantage Iran may seek from possession of nuclear weapons.

  4.11  Clearly, introducing nuclear weapons into a region as unstable as the Middle East, involving cultures that have experienced such enduring hostility and regular "hot wars", is highly undesirable, and deterrence in these circumstances is unlikely to be effective in the long run. Equally, the threat, large enough in reality, should not be exaggerated. Quoting the Iranian President out-of-context, and interpreting words in particular ways, does not support the thesis that Iran would use a nuclear weapon against Israel.

  4.12  There is widespread recognition within Iranian security establishment that moves towards open deployment of nuclear weapons, or an ambiguous posture mirroring Israel, would make Iran a target. It would also severely undermine Iran's relationships in the region, to the point where neighbours may well decide to develop their own nuclear arsenals, or develop much stronger security partnerships with the United States. This would entrench the US position in the region, harming Iranian influence significantly.

Prospects for a Nuclear Weapon Free Zone (NWFZ) in the Middle East

  4.13  A belligerent and fearful atmosphere after the Cuban Missile Crisis in the early 1960s prompted the countries of the Latin American and Caribbean Region to create the world's first Nuclear Weapons Free Zone (NWFZ) Treaty. Since then, three more NWFZs have been created: the 1985 Treaty of Rarotonga, covering the South Pacific; the 1996 Treaty of Bangkok, covering Southeast Asia; and the 1997 Treaty of Pelindaba, covering Africa. In addition, Austria (1999) and Mongolia (2000) are single-state NWFZs. A Treaty creating a Central Asian NWFZ has been opened for signature, but there remains disagreement over whether it may have a loop hole over the transportation or deployment of Russian nuclear weapons. There continue to be discussions (but currently no more) on the possibility of NWFZs in the Middle East and in parts of Europe.

  4.14  The proposed Middle East NWFZ would differ significantly from previous ones in that it would include a de facto nuclear weapon state (Israel) and border on another declared nuclear weapon state (Pakistan). It would also require a transition from past experience, whereby the treaties established a passive but legally protected status for countries in the region covered by the NWFZ, to a situation where active disarmament is carried out. Iran's nuclear programme would need to be curtailed or controlled to provide guarantees against "breakout", while Israel would need to verifiably dismantle its nuclear weapon stockpiles and place its nuclear facilities under IAEA safeguards. To protect Israeli interests, and assure its security, such a scheme would also probably require an extended US security guarantee, to the effect that it would destroy any Iranian, or other Middle Eastern, facility that threatened to cheat.

  4.15  The goal of a NWFZ in the Middle East has long been recognised as both desirable and unachievable. Today, it is more necessary—but less likely—than ever, and could be made more possible, given courage and vision of the kind that spawned momentous changes in the previous century (such as the Marshall Plan, the end of the Cold War and the re-unification of Germany).

5.  INTERNATIONAL ENGAGEMENT WITH IRAN OVER NUCLEAR NON-PROLIFERATION

  5.1  Since the 2002 exposure of its clandestine nuclear programme, Iran has devised at least five proposals which included provisions designed to assure the international community that its nuclear activities are exclusively for peaceful purposes, rather than nuclear weapons. In early 2003, the Iranian government indicated a willingness to negotiate an end to its support for Hezbollah, its opposition to the Israeli-Palestinian peace process, and possibly its nuclear programme. An April 2003 proposal from Iran for resolving these differences was ignored by the Bush administration. Key US officials, including then-National Security Advisor Condoleezza Rice, now claim they never saw the Iranian proposal.

  5.2  Later in 2003, France, Germany, and the United Kingdom (E3) agreed to discuss with Iran a range of nuclear, security, and economic issues as long as Tehran suspended its uranium enrichment programme and cooperated fully with the IAEA investigation. However, that agreement unravelled in 2004 when Tehran continued aspects of its work on developing a nascent enrichment programme.

  5.3  Iran then agreed with the E3 in November 2004 (under the Paris Agreement) to implement a more stringent voluntary suspension. Negotiations between the two sides began shortly afterwards. Iran's proposals emphasised a broad regional security approach, including action against terrorism (indicated by a stated willingness to reign in the actions of Hamas and Hezbollah, and to see to their disarmament and integration into the political structures of Palestine and Lebanon), further agreement to reinforce respect for sovereignty and national security, and technical and economic cooperation. Iran's proposals to the joint E3-Iranian meeting in March 2005 accepted the possibility of limiting the country's nuclear programme by: (a) operating an open fuel cycle (ie no reprocessing); (b) agreeing a ceiling of enrichment at LEU levels; (c) immediately converting all enriched uranium into fuel rods; (d) continuing to implement the Additional Protocol and continuous on-site presence of IAEA inspectors at Esfahan and Natanz; and (e) confirming a permanent ban on nuclear weapons, and the enforcement of Iranian export controls on sensitive nuclear technologies and materials.

  5.4  The Iranian proposals in March and April 2005 contained clear precursors to those that were subsequently included in the E3 proposals in August 2005. The election of Mahmoud Ahmadinejad as Iranian President was a turning point in relations, and pushed the Europeans onto the back foot. But it is still not clear if the deterioration in negotiations occurred as a result of any change of Iranian policy or because of a hardening of attitudes by EU negotiators (under pressure from the US administration) following the election. What is clear is that the talks soured: the offer from the Europeans was delayed into August, and when Iran restarted its uranium conversion activities on 1 August 2005 the opportunities for compromise had already diminished considerably.

  5.5  The August 2005 E3 offer was characterised by BASIC at the time as strong on demands and weak on concrete offers. It showed little willingness to make clear and concrete positive proposals until Iran had made commitments not to develop its nuclear fuel cycle activities and to place all nuclear work under tight safeguards. The E3 proposal failed to pay enough attention to key Iranian interests, and may have been motivated more by a desire to appease Washington, which was not prepared to tolerate any Iranian enrichment, than to finding a solution. The Iranian response was furious, and had an air of finality about it, pushing the diplomacy further towards a crisis situation.

  5.6  The subsequent P5+1 proposal to Iran on 6 June 2006 was an improvement on the previous offer in two key respects: it involved all the major parties representing the UNSC (P5+1); and it was less demanding and included clearer incentives to Iran. BASIC highlighted seven key aspects to the draft proposal that was leaked at the time: http://www.basicint.org/pubs/Notes/BN060901.htm_en03#en03(a) the willingness of the United States to sit down directly with Iran; (b) recognition of the Esfahan uranium conversion plant; (c) an international fuel cycle centre in Russia involving the Iranians; (d) a five-year fuel-bank/buffer stock for Iran; (e) affirmation of Iran's inalienable right to nuclear energy for peaceful purposes; (f) an energy partnership that included investment in Iran's oil and gas infrastructure, and assistance in energy conservation and renewable technologies; and (g) a new regional political forum to involve Iran and other regional states to discuss security guarantees, and a WMD-free zone for the Middle East.

  5.7  Subsequently "Elements" of the P5 + 1 package were published by the French Foreign Ministry. It is difficult to know whether this is a summary document or the full proposal. Made after the Europeans consulted with the United States, it appears to have diluted several of the proposals outlined in the draft. For example, the proposed regional political forum to discuss security guarantees and a WMD-free zone was relegated to a vague "new conference to promote dialogue and cooperation on regional security issues". Indeed, the Bush administration only agreed to support the June 2006 offer after the EU agreed to drop any security and territorial integrity guarantees.

  5.8  The fatal flaw within the final P5+1 offer was the precondition that Iran give up enrichment before coming to the negotiating table: giving up leverage with no clear quid pro quo commitment on the part of the United States or the Europeans. The Iranian delay in replying was therefore inevitable; it would require complex internal discussions to hammer out an agreed line when offered tempting nuggets, alongside an unacceptable precondition that Iran give up its main bargaining chip.

  5.9  The Iranian counter-offer was never made public. However, the 21-pages had sufficient substance for Javier Solana, representing the EU in the negotiations and the formal recipient of the counter-offer, to decline any immediate formal public reaction. He limited his remarks to saying that "the document is extensive and therefore requires a detailed and careful analysis". Official Iranian declarations and reports since then strongly suggest that the Iranian counter-proposal rejected pre-conditional suspension of enrichment, but that suspension within the negotiations would be considered.

  5.10  The E3/EU have been in negotiations with Iran over this issue, on and off, for nearly four years now. It is widely seen as a test case for European foreign policy after the divisions caused by the invasion of Iraq in 2003. The November 2004 temporary suspension of Iranian enrichment was seen as an initial success for European diplomacy. But when the Iranians restarted enrichment in August 2005, the E3/EU saw it as an affront to their position, leading to a more determined stance. While the EU has supported the targeted, but limited UN sanctions, many EU member states are reluctant to push coercion too far, not least because they are worried about handing over valuable commercial opportunities and essential energy sources to Russia and China. In addition, opposition to military action is currently widespread within the EU, even though key leaders (notably Tony Blair and Angela Merckel) have refused to rule it out, believing the threat to be an important negotiating tool. The election of Nicolas Sarkozy to the French Presidency adds a new dimension, and his first published comments on the standoff suggest a hardening in the French position. On the 23 May he said "I for my part think one should not hesitate to toughen the sanctions" in an interview published in the German monthly magazine Cicero.

  5.11  The failure of the US government to attempt any meaningful diplomacy with Iran or to rule out military action has also been damaging. US policy appears to be based on the premise that Iran's further isolation will prompt regime change. Such a policy is fanciful, almost certainly counter-productive and no substitute for the proper engagement which is now urgently needed. US and EU policies that appear to discriminate against Iran are likely to strengthen domestic support for the present government and its pursuit of nuclear technology and limit international pressure on Iran. The present EU-US strategy is only likely to push Tehran eastwards, building further economic and political relations with Russia, China and India.

  5.12  Russia and China hold powerful positions in this diplomatic process. Both countries are keen to prevent Iran acquiring nuclear weapons—they fear Islamic extremism as much as the US administration does. Both, however, also have strong interests in spoiling any strong rapprochement between Iran and the West that might harm their current and future commercial interests with Tehran. Russia remains committed to building the Bushehr reactor and has invested heavily in the Iranian oil industry infrastructure. A more adversarial and distant relationship is developing between Russia and the West, partly due to renewed confidence in Russia's own place in the world (bolstered by a much stronger economy driven by energy exports) and partly by a perception that it continues to be frozen out by key Western institutions, such as NATO and the EU. Thus, according to resurgent Russian strategic interests, Iran plays an important offsetting role to the US power in the Middle East. Russia and Iran together also hold more than 50% of the world's known reserves of natural gas, which is widely expected to grow in strategic importance over the next decade or so.

  5.13  Similarly, China's growing hunger for energy inevitably determines its foreign policy towards Iran and the Central Asian states to the north. Chinese officials have consistently called for a negotiated settlement to the dispute, and appear reluctant to push coercive diplomacy and sanctions too hard. They are likely to support efforts that avoid conflict but also prevent the emergence of a nuclear-armed regime in Tehran.

  5.14  If negotiations are not revived, this stalemate in the UNSC is likely to leave Iran with sufficient wriggle-room to develop their nuclear weapons capability transparently and under existing safeguards. Continued allusions by US officials to the prospect of military action also give the Iranian government a powerful incentive to double their efforts in this direction. Should these events occur, the prospect of military action against Iran by either the US or Israel cannot be excluded. Such action would be a disaster for global and regional security and must be avoided. Diplomacy and creative compromise on all sides are the only acceptable choice. The core diplomatic challenge facing all the main players is to craft a compromise that allows all parties claim some victory. Any successful negotiation requires nothing less.

6.  ALTERNATIVE OPTIONS, AND THE IMPLICATIONS FOR SECURITY

  6.1  We are often sold the current strategy as if it were the only realistic course on offer (contrasted with military action on one extreme and appeasement on the other). In actual fact there are plenty of possible ideas, themes and strategies that could make the attempt to prevent Iran's acquiring a weapons capability more likely to succeed.

  6.2  Solutions often require creative thinking. In attempting to develop a workable resolution those involved need to ask what they ultimately hope to achieve. Once these goals are established and parties acknowledge that there are common interests, room for negotiation can be found, but only with a credible commitment from all sides. So far, while the US administration has occasionally tempered the rhetoric in an effort not to alienate its European allies and Russia and China, it has shown little faith in achieving a negotiated solution, and little willingness to compromise on the policy positions adopted and demands made.

  6.3  It is clear the US administration is "building a case" against Iran. What it intends to do with that case is unclear. But while the situation is dynamic and uncertain, some of the major underlying issues have remained constant throughout the crisis.

  6.4  The first of these issues is the need for accountable, farsighted and coordinated problem solving in Washington and the capitals of Europe—as opposed to the irresponsible, short-sighted and largely unilateral US-led action that has led to the failure in Iraq. It would be folly of an even greater magnitude to rely upon a build up of US military forces within the region to pressurise Iran to change course and allow that momentum to determine the choice over military strikes. The US elections of November 2006 demonstrated that Americans are ready for a new approach to national security. Surveys and opinion polls in Europe also confirm a large transatlantic consensus for policies that are effective; policies that reflect a principled and lucid assessment of the best way to achieve national security goals. There is growing repudiation of the pre-emptive use of military force, and a desire for US and European governments to use all the tools in their foreign policy toolkit (diplomatic, economic, intelligence) to tackle complex security challenges.

  6.5  A second theme is the contrast between the disastrous costs of an unprovoked attack on Iran and the potential lasting benefits of a serious dialogue with Iran. There is broad agreement among military and intelligence experts that there is no good military solution to this problem. While an attack on Iran would have disastrous costs and consequences, without achieving the intended results, the potential benefits of a constructive and open dialogue with Iran are substantial. Building a direct relationship with the government and people of Iran is likely to pay off domestically, for the region, and for the rest of the world.

  6.6  A third then is that smart, tough-minded multilateral diplomacy—of the kind that has just been applied to North Korea to stop, seal and (hopefully) ultimately disable its nuclear facilities as part of a grand bargain—works, even in the most difficult of circumstances. Diplomatic options with Iran are not only less risky than military options but also more likely to produce real and long-lasting progress—and are a long way from being exhausted.

  6.7  It will not be easy for the US administration to talk with Iran—nor for some Iranian officials to talk to Washington—and any agreement will require both sides to step back from their red lines and swallow some bitter medicine. But the elusive middle ground is still available for negotiations to develop. However, the broad outlines of the negotiation that has to take place are already known to diplomats on both sides, outlined in a communication sent by Tehran to Washington in April 2003—although the hard work of devising mutually acceptable trade-offs has yet to begin. We discuss some of the potential trade-offs below.

  6.8  A final theme is the need to look at the big picture in the Middle East and globally. A smart, farsighted Iran policy will help stabilise the region and enable progress to be made towards some of US and Europe's most important shared foreign policy goals. Thus, there is an urgent need to halt the escalating rhetoric and to get serious about diplomatic engagement with Iran across a range of issues. The US administration needs to openly recognise that policy, not regime, change is the goal. The cost of not talking to Iran is unacceptably high, and getting higher. It is undermining regional stability and global hopes of stemming nuclear proliferation. While there is no guarantee that talks with Iran would succeed, the refusal of the US to talk is increasing the likelihood of transatlantic failure in too many important areas.

  6.9  The P5+1, and especially the United States, must enter into direct negotiations with Iran without pre-conditions. In the short-term, we believe the best strategy lies with ensuring that controls over Iran's nuclear fuel cycle are fair, equitable and effective. To satisfy international concerns, Tehran should accept an intrusive nuclear inspections regime going beyond what is stipulated in its Safeguards Agreements with the IAEA, and even any revival of its Additional Protocol. While it would be preferable in the long-term for Iran, as well as other countries, to rely on other, safer energy sources, the P5+1 governments must recognise that, without evidence of nuclear weapons development, their entitlement and ability to impose restrictions on Iran's nuclear programme are limited. In this context, and in the light of proposed US nuclear cooperation with India (a non-NPT state), the EU-US insistence that Iran permanently shut down much of its nuclear fuel activities are not backed by the NPT and appear discriminatory. It may also reinforce perceptions among Muslims that the US and EU wish to relegate them to second-class status. P5 plans to update their own nuclear arsenals also exposes them to charges of hypocrisy. Finally, states within the Non-Aligned Movement in particular see Iran as the "thin end of the wedge", and fear that the US-EU axis will also attempt to restrict their access to nuclear power technologies. The Iranian government has successfully framed the disagreement among much of its population and the non-aligned movement as an attack upon its rights. This has entirely overshadowed and squashed the more important domestic debate around the costs and benefits to Iran from pursuing this technology. The US and EU positions are partially responsible for this.

  6.10  Without flexibility on the key issue of Iranian nuclear fuel production there is little prospect of either reaching agreement with Iran or, alternatively, building the strong international consensus for dealing with the Iranian "nuclear dossier" (see Table 2 for ideas already floated). Since best estimates suggest that Iran is several years and possibly a decade away from any potential nuclear weapon we recommend a renewed P5+1 effort to constructively negotiate a more equitable agreement with the Iranian government.

  6.11  Flexibility aimed at closing off Iran's easier routes to nuclear weapons while ensuring that any remaining sensitive activities (such as limited enrichment) are closely scrutinized through rigorous inspections could open up more palatable options for engagement in the future. This could be assisted by the explicit identification of those technologies that present greater threats of proliferation, and an agreement on this analysis. For example, HWRs and reprocessing plants present more danger, and are more difficult to monitor, than enrichment activities. If the EU were to lead on building a consensus around this, in collaboration with the IAEA, it could make more transparent the need to control such technologies.

Table 2

IDEAS ALREADY TRIED FOR BREAKING THE ENRICHMENT STALEMATE

    Cessation of enrichment (EU3 2003)

    Indefinite suspension, no HWR, with LWR for research (EU3 2005)

    Continuation, under normal safeguards and Additional Protocol (Iran 2004-05)

    Internationally supervised on-shore enrichment Joint Venture (Iran, floated 2004-07)

    Off-shore enrichment Joint Venture (Russia 2006)

    Moratorium on industrial scale enrichment (Iran 2006)

    Time limited moratorium on all enrichment and HWR activity (P5+1 2006)

  6.12  The Forden-Thomson plan for breaking the stalemate deserves greater attention. Essentially, this proposal involves a multilateral enrichment facility on Iranian soil with the capacity to provide material for a virtual fuel bank. The sensitive centrifuge technologies would be "black boxed". For further details, see BASIC Iran Discussion Paper Series, No.2, "The Iranian Nuclear Crisis—A Risk Assessment", by Sir John Thomson, March 2007, http://www.basicint.org/pubs/Papers/iran2.pdf The proposal has merit because it: (a) meets the bottom line of all sides, enrichment on Iranian soil and no nuclear weapons in Iranian hands; (b) has robust and effective built in safeguards, which are more likely to prevent clandestine operations than any other proposals; and (c) represents arguably the best option in difficult circumstances. Of course, this proposal risks giving Iran access to the most advanced centrifuge technologies, and the facility could be "nationalised" or seized by force at some later point. But were Iran to do so, its intentions would be crystal-clear and enable a robust and unified international response—unlike the situation today.

  6.13  An alternative proposal, and one that BASIC has been advocating for over 18 months, is the operation of a limited or pilot enrichment facility at Natanz. There would be strict limits on the numbers of centrifuges and on the amount of time they would be allowed to operate, as well as an intrusive IAEA inspection regime to prevent diversion to a nuclear weapons programme. Again, the risk is that it would allow Iranian technicians to gain increased knowledge of the enrichment process, transfer those skills to a covert facility and then to achieve "breakout". But that risk already exists and grows more likely as the current stalemate continues. With Russian and Chinese support for such a proposal it would at least tie Iran to a clear commitment, and allow for greater unity in the UNSC in the event of a future transgression by Iran.

  6.14  In exchange for international acceptance of either a multilateral or a highly limited and carefully monitored national "front-end" nuclear fuel capability in Iran and a precise and detailed plan of action addressing Iran's economic and security concerns (see below), Tehran might be expected to: (a) establish a continuous, in-country IAEA inspections regime with the power to visit any site, with due regard to Iran's sovereignty and security; (b) permanently cease construction of the HWR at Arak, which is a dangerous potential source of plutonium for nuclear weapons; (c) relinquish any ambitions to reprocess spent nuclear fuel, which can be more easily diverted for nuclear weapons; and (d) permanently renounce its rights under Article X of the NPT to withdraw from the IAEA safeguards regime, or failing that, enact domestic legislation that binds the Iranian government to a non-nuclear weapon policy indefinitely.

  6.15  In addition to securing some form of enrichment on Iranian soil, Iran's negotiators will most likely also require more detailed and specific measures to guarantee the security of the Iranian state (and the current regime) against external attack. Engaging with Iran on broader regional security issues could potentially be very favourable.

  6.16  Concrete EU/US proposals for a new regional security architecture would go far in alleviating Iran's sense of vulnerability. More than economic incentives, security cooperation has the potential to not only undermine Iranian ambitions for a nuclear weapons programme, but also provides the opportunity to discuss Iranian support for radical groups in Iraq, Lebanon and Palestine, and, perhaps, achieve concessions there as well. Iran has said that it is willing to consider temporarily suspending enrichment if negotiations progress. The P5+1 should offer an invitation to a major regional conference on specific security issues, including a discussion of security guarantees from the United States, while Iran suspends its fuel-cycle programme as a quid pro quo.

  6.17  In the longer term the international community must aim at solutions that assure Iran and other states that they have no need for nuclear weapons, by building clear assurances of security through regional defence arrangements and reformed defence and foreign policy postures from external powers. Control of technology transfers and enforcement of agreements could be further tightened. The Proliferation Security Initiative (PSI) needs to be applied consistently and fairly; reaching out to Russia and China is therefore particularly important. The informal arrangements of the Nuclear Suppliers Group need reform; export control information is not systematically shared with the IAEA or even fully among the Group's members.

  6.18  The economic incentives offered by the P5+1 in June 2006 also need to be enhanced in order to change Iran's cost-benefit calculus. The lifting of US restrictions on foreign investment in Iran's oil refinery sector would be one such move. The claims from US officials that Iran need only improve the efficiency of its oil sector to achieve the energy savings equivalent to potential production from a nuclear energy programme are undermined by such restrictions.

  6.19  Finally, the nuclear weapon states must speed up their own negotiations over the disarmament commitments they made at the 2000 NPT Review Conference, such as the Fissile Material (Cut-Off) Treaty to ban the production of highly enriched uranium and processed plutonium, and make moves to reduce their reliance upon nuclear weapons. Pressure must also be exerted upon Israel to discard its nuclear weapons, accede to the NPT, and join talks towards the establishment of a WMD-free zone in the Middle East. Silence on the Israeli case only serves to strengthen public support throughout the region for a balancing nuclear power.

  6.20  Britain's own decision to renew Trident was directly and indirectly criticised by other States Parties (and not just Iran) at the recent NPT Preparatory Committee meeting in Vienna. The UK has missed a major opportunity to lead the way in devaluing the military, political and symbolic importance of nuclear weapons, and as a result, the UK government has very little moral authority to persuade other countries to permanently give up their own pursuit of these weapons.





 
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