Iran and Uzbekistan Unveil Central Asia’s Plan B

March 2023 will be remembered as a good month for the Islamic Republic of Iran.

First, Iran and longtime foe, the Kingdom of Saudi Arabia, announced they would re-establish full diplomatic relations and reopen embassies within sixty days, thanks to China’s mediation (and Iraq’s and Oman’s early efforts). The news was followed by the Saudi finance minister who said Saudi Arabia could start investing in Iran “very quickly.” Days later, Saudi Arabia’s King Salman invited Iran’s president, Ebrahim Raisi, to visit the kingdom; Iran promptly accepted

Also in March, Iran formalized ties with the Taliban government in Afghanistan by turning over the Afghan embassy in Tehran to diplomats from the Taliban. Syria, Iran’s ally, which is close to rejoining the Arab League and the mainstream of the Arab world, marked an official visit by President Bashar Assad to the United Arab Emirates. (Arab leaders have offered Assad billions of dollars in reconstruction aid if he will “ask Iran to stop expanding its footprint in the nation.”) And, Saudi Arabia, which funded the opposition to Assad, reversed course and announced it will re-open its embassy in Damascus.

Last, the foreign minister of the Republic of Uzbekistan met Iran’s ministers of Foreign Affairs, and Industry, Mines and Trade, and the parties announced efforts to double trade turnover to $1 billion, and to foster business links and people-to-people ties. The ministerial meetings were the follow-on to the September 2022 sit-down between Uzbek president Shavkat Mirziyoyev and Iran’s Raisi where they concluded 17 agreements in areas such as energy, transport, and agriculture, and discussed how to double trade from the current $500 million annually.

Iran is within sight of securing calm on its eastern and western flanks, its ally Assad is winning, and Riyadh and Tehran have committed to ending the war in Yemen. Tehran’s security forces have taken control of the streets after the recent protests, and the government may now be able to focus on economic growth (and reform) to secure its position, and execute Raisi’s policy of increased engagement with Asia. Time is not on the side of the Tehran government as officers of the Islamic Revolutionary Guard Corps recently warned Supreme Leader Ali Khamenei of declining morale in the Guards and their concerns about corruption in the higher tanks.

Iran is increasingly attractive to the landlocked Central Asian republics that are seeking redundant trade routes.

In June 2021, Tashkent hosted a conference to highlight Central Asia-South Asia connectivity via Afghanistan and Pakistan (Plan A). Two months later, the U.S. and NATO retreated from Afghanistan and the country plunged in chaos, so the republics had to consider alternatives. In February 2022, the Russia-Ukraine war forced Kazakhstan to develop a trans-Caspian route to avoid the effects of the Russian-Ukraine war, and the other republics followed suit.

Central Asia can now consider trading through Iran’s ports of Chabahar and Bandar Abbas. (In January 2022, Iran and Uzbekistan concluded an agreement to give Uzbekistan access to Chabahar port on the Gulf of Oman.) Iran can offer a space free of the violence by the Islamic State (IS) and the Pakistani Taliban (TTP) that plagues Afghanistan and Pakistan, organized and functioning government agencies, and ports adjacent to the markets of India (Chabahar) and the Persian Gulf (Bandar Abbas). Iran is also a large market of almost 90 million people.

Uzbekistan, which borders Afghanistan, has publicly engaged the Taliban since 2018 and has supported regional projects to connect Afghanistan to its neighbors such as the TAPI natural gas pipeline, the CASA-1000 power project, and the rehabilitation of the Afghan rail network. In early 2021, Afghanistan, Pakistan and Uzbekistan announced a 600-kilometer railroad through Afghanistan, but the project faces financial and geographic obstacles, now all the more difficult given the desire of the West to isolate the Taliban and force them from power.

Regardless of Central Asia’s labors on Afghanistan’s behalf, the agreements with Tehran are a signal to Kabul that the republics’ patience is limited and that it must re-start state institutions that facilitate trade, and must quell violence by the Islamic State in the north of the country – near the borders of Turkmenistan, Uzbekistan, and Tajikistan.

And this isn’t just outsiders talking to Kabul: recently Mullah Yacub, the Afghan Minister of Defense, and Sirajuddin Haqqani, Minister of the Interior, warned Hibatullah Akhundzada, Afghanistan’s supreme leader that reforms must be quickly forthcoming or else there would be “consequences.”

The West would prefer to wait out the Taliban as it is preoccupied fighting Russia in Ukraine, but “time is money” and Central Asia can’t dawdle as is still recovering from the COVID-19 pandemic, grappling with inflation and a fall in remittance income from guest workers in Russia, and is bracing for a worldwide financial crisis again, as in the 2007-2008 crisis, caused by a failed U.S. financial institution.

In addition to a well-developed internal transport system, Iran also hosts the International North–South Transport Corridor (INSTC), a 7,200 kilometer ship, rail, and road route for moving freight between India, Iran, Azerbaijan, Russia, Central Asia and Europe. The INSTC is considered “sanction proof” and is claimed to be “30 percent cheaper and 40 percent shorter than the traditional route via the Suez Canal.”

There will be long faces in some quarters, but Iran is positioned to be a significant regional transport hub even if Afghanistan manages to become a satisfactory entrepôt for Central Asia.

In 2021, Iran and China announced a twenty-five-year $400 billion strategic and economic partnership that included oil, gas, petrochemical, renewables, nuclear power, energy infrastructure, port construction, and high-technology and military cooperation. The agreement was more a statement of intent than a binding agreement, and it was considered fanciful as Iran would have to absorb an average of $16 billion per year.

But, if Iran’s flanks are peaceful, its attractiveness as a transport corridor will increase, aided by Saudi and Chinese (and other) investment. And Chinese participation may offer a measure of security against gratuitous Israeli attacks as Tel Aviv will have to consider Beijing’s reaction to raids that kill Chinese workers or damage Chinese investments.

The Central Asian republics, independent for the first time in almost 200 years, are trying to balance between the U.S., Europe, Russia, China, and Turkey.

Iran will be next because, like most big countries, it tends to not notice when it is bumping into the furniture. That said, there is no antagonism between the republics and Iran and one of them, Tajikistan, has a 25-year military cooperation agreement with Iran and hosts a drone factory in the capital of Dushanbe.

The Islamic Republic is, well, an Islamic republic, and will be engaging with secular Central Asian republics that may share the same religion but, given their 20^th century history, are averse to unwanted influence from a foreign power center or political Islamist movements.

A recent example: the Islamic Renaissance Party in Tajikistan that opposed the secular government in a 1990’s civil war that killed 150,00 people and displaced one-tenth of the population. And while Iran may think it is the leading Muslim state, Central Asia can make a claim to being Islam’s true heartland and won’t feel it must defer to the larger neighbor in matters of faith.

In early March, U.S. Secretary of State Antony Blinken visited Kazakhstan and Uzbekistan to meet his opposite numbers in Central Asia. The successful trip was heralded for a “new approach” because, for once, Washington isn’t asking for assistance in its Afghanistan campaign, and says it wants to help the republics achieve balance in their relations with each other, and with the outside world (though it may not have occurred to Mr. Blinken that some of that balancing may be against Washington.)

Aside from its economic heft, America’s advantage is that is in interested in the region but is not too close for comfort.

It should encourage regional trade, as the republics will best be able to balance among their big neighbors if they have money, and a lot of it, though, as Temur Umarov points out, the just-announced Russia-China policy on Central Asia “will complicate Central Asia’s multi-vector foreign policies.”

In the wake of NATO’s retreat from the Hindu Kush, Eurasia may start to self-organize, a process that Washington and Brussels won’t always agree with but which is grounded in shared culture and history dating back a millennium, whereas Washington has only paid attention to the area from the afternoon of 11 September 2001.

The challenge for the U.S. and Europe will be to restrain themselves and not press-gang Central Asia into their crusade against the Islamic Republic.

Washington should support local problem-solving efforts through initiatives such as the Organization of Turkic States, but there is a great chance Washington and Brussels will be unable to shake the confused belief that the only good ally is a subservient ally.

An independent ally with a strong economy is the best friend, and the Central Asian republics will respond to rational political calculation and good will instead of impulsiveness driven by a narrow fixation on Tehran, to the detriment of America’s wider interests in Eurasia.

James Durso (@james_durso) is a regular commentator on foreign policy and national security matters. Mr. Durso served in the U.S. Navy for 20 years and has worked in Kuwait, Saudi Arabia, and Iraq.