After nearly 35 years of estrangement between Iran and the United States, a short phone call between President Rouhani and President Obama on September 27, 2013 culminated a marathon diplomacy which started few days earlier at the United Nations and following the blessing of the Supreme Leader Ayatollah Seyed Ali Khamenei in what he qualified as 'Heroic Flexibility'.

Although it is too early to speculate about the pace of the rapprochement between Iran and America, what is certain is that with direct talks between the two leaders at the highest level, the first major step toward normalization of relations has been taken. This development will have tremendous effects on the two countries economic cooperation, as well as bringing about peace and stability in the region. The diplomatic contacts are especially important at a time that the region is going through a transitional phase and international efforts are needed to prevent further spread of extremism and terrorism. Both Iran and the U.S. have expressed their concerns over these phenomena and have common interests in fighting against them.

The mutual efforts by Iran and the U.S. for economic development plans in Afghanistan and Pakistan could also benefit these two nations who are suffering from terrorism and influence of extremist forces in their countries. However, despite much optimism from both sides the key question is the nuclear issue that lingers more than a decade. The issue has snowballed during the past years by mismanagement and unprofessional diplomacy among other things.


There is no doubt that nuclear issue takes the first priority in the future talks.  These talks are scheduled to start in the framework of P5+1 (the five permanent members of the U.N. Security Council plus Germany) in October 2013 in Geneva. 

Obviously, the concerns about Iran's intention can be alleviated when there is benevolence to build trust from both sides.  On its part, Iran has expressed its willingness to fully cooperate and to provide sufficient guarantees to not opting for nuclear weapons in the context of a 'win-win' approach in the negotiations. Although it might sound a little idealistic at the moment, but a second track in the framework of bilateral negotiations between Iran and the United States could enhance the progress in the first track.

With some creative diplomacy and in contrast to its previous role as a spoiler in nuclear talks with Iran, Washington now has the chance to play a positive role as an accommodator in the future talks, easing the way toward successful bilateral relations with Iran. Yet, given the fact that the essence of the Iran-US standoff derives from a deep-seated mutual mistrust, drawing a road map with a clear endgame at the start of the negotiations seems imperative.   

Thus, the opening in the Iran-US relations may influence mainly two important areas: First, is the nuclear issue, where a second track on the nuclear talks would be established in a bilateral framework and in parallel to the current P5+1 talk. Indeed in the Iran-US bilateral talks, the issue of sanctions looms high on the agenda. Presumably, in this fast track negotiation on the nuclear issues, the aim has to be reaching a timeframe for lifting the sanctions which are not only crucial in the progress of the rapprochement between Tehran and Washington, but it could have much advantageous consequence for the future trade and investment between the two sides. Despite three decades of sanctions Iran has developed much in terms of technology and industry, yet its vast economic potentials for trade and investment has to be tapped. In this respect, it seems that at present there are three areas in the Iranian economy that are more promising for cooperation with their respective counterparts in the United States. These are:

1-   Energy sector; including oil, gas, electricity and renewable energies (wind, sun and thermal). Iran has developed necessary skills and technological base in all of the said energy areas. Iran has also developed considerable capacity in the oil and gas pipeline schemes both for transportation of oil and gas for its domestic use or for the export. Flow of the new investments and transfer of technology could boost this sector many folds. American companies are one of the best in these fields and they could also benefit a lot from cooperating with Iranian oil companies at international level.

2-   Purchase of new fleet of airliners. Iran has long complained about illegality of sanctions on purchase of new aircrafts for its airliners. There is a potential market for U.S. aircraft industries in Iran that could tap billions of dollars for those companies once the unilateral sanctions by Washington are lifted.

3-   Auto industry in Iran is another area of interest for American companies. This sector has gained much support from the Iranian government in the past. Its production peaked over million vehicles two years ago.  However, due to the sanctions and lack of competition in the domestic market it has suffered a setback in introducing new technologies and satisfying consumers. With the lifting of sanctions, major automakers in the U.S. would be able to enter the flourishing auto market in Iran through investment and shared production. 

Second, is the question of regional security and cooperation. It is widely believed that finally the global democratic wave has arrived in the Arab world and to the regimes which are typically allies of the West. The precarious situation in the Arab world and possible spread of upheavals to the countries in the Arabian Peninsula calls for caution and consultation between Iran and the United States. These two regional and extra-regional powers find their interests in stability of the region while peaceful reforms are taking place. For that purpose, destabilizing effects of democratic changes similar to what happened in Tunisia, Egypt and Libya should be avoided by taking precautionary measures while there would be guarantees for rapid and unhindered transition to democracy.

Presently, some countries in the regions adjacent to Iran namely in the Middle East and South Asia are experiencing volatile upheavals. The situation in Syria and Iraq on the western borders of Iran and Afghanistan and Pakistan on its eastern borders is alarming and calls for immediate attention.

The U.S. has been militarily involved directly in Iraq and Afghanistan and it has threatened to intervene in Syria. Thanks to Iranian and Russian initiative for Syria's chemical weapons disarmament that has thwarted U.S. military intervention and plunging in another war in the volatile Middle East region.

Evidently, for some regional allies of the U.S. such as Israel or Saudi Arabia the prospect of even a nonnuclear Iran, reenergized economically by the lifting of sanctions, and politically more powerful with the renewed relations with Washington is not a comfortable scenario. During the last three decades, they have enjoyed Iran's absence from the scene and it is unlikely that they would easily adapt themselves to the new situation where they consider that a shift in the balance of power toward Iran is imminent. 

The simple act of two presidents of Iran and America in talking directly has infuriated Benyamin Netanyahu and Israeli hardliners who see that all of their false propaganda since 1985 mentioning that Iran was only months away from having a nuclear bomb is becoming useless and absurd.

At the strategic level, while Israel and some Arab countries in the Persian Gulf tend to perceive these relations merely affects the balance of power in the Middle East and North Africa, it certainly has much wider implications for strategically important regions adjacent to Iran, such as the Caspian Sea area, where Russian interests are involved or in the West Asia, where besides India and Pakistan the crisis in Afghanistan is still much alive.  That region is also adjacent to China and heart of Asia, where Obama administration’s strategic “pivot” from the Middle East to Asia is aimed at.  

Although the Iran-US relations have entered a new phase with new dynamism but this would not suggest, as both sides have conceded that the task ahead is not without challenges. The momentum that started at the current UN General Assembly has already faced some hurdles by conservatives in both countries. While the recent telephone conversation between the leaders of two nations was symbolically very important, but it has to be considered as the first step in a long way ahead. Indeed, in the context of the new diplomatic practices, both sides are now able to engage in a meaningful diplomatic dialogue for reaching agreement on vast pending issues; keeping in mind that Iran and the United States need each other and their collaboration can have a positive effect on establishing peace and stability in the Middle East and South Asia.