July 17, 2015 | Policy Brief

The Nuclear Deal’s Impact on Iran’s Revolutionary Guards

July 17, 2015 | Policy Brief

The Nuclear Deal’s Impact on Iran’s Revolutionary Guards

One of the foremost beneficiaries of the Iran nuclear deal signed this week is the Islamic Revolutionary Guards Corps (IRGC), the militia-cum-business empire whose clout has grown exponentially over the last decade and now controls at least one-sixth of the Iranian economy. The IRGC – the spearhead of Iran’s internal repression and external adventurism – is now poised to gain in four significant areas. 

1.      Access to the global economy

The IRGC’s Khatam al-Anbia (“Seal of the Prophets”) is Iran’s biggest construction firm and may be its largest company outright, with 135,000 employees and 5,000 subcontracting firms. Designated by the U.S. Treasury as a proliferator of weapons of mass destruction, it is developing Iran’s massive South Pars gas field, a pipeline to Pakistan, and even a Tehran metro line. The nuclear deal stipulates that all European Union sanctions on the company will be removed.

The IRGC Cooperative Foundation is the IRGC investment arm and holds a portfolio controlling over 20% of the Tehran Stock Exchange. The nuclear agreement will grant the foundation – through the general improvement in Iran’s economy and foreign direct investment – additional resources to expand its portfolio, and to invest in industrial assets and financial instruments overseas.

Ansar Bank and Mehr Bank are both IRGC-owned. With renewed access to the SWIFT banking network, as stipulated in the deal, they will receive permission to open branches, conduct transactions abroad, facilitate financial flows for the IRGC, and provide financial services to IRGC entities both in Iran and internationally.

2.      Increased support for terror groups and militias

The Quds Force, the IRGC’s external arm, is active across the region. It fuels the Syrian government’s brutal war effort by transporting weapons, advisors and military personnel to Damascus. The group has trained foreign fighters from Afghanistan and Iraq to fight alongside Hezbollah in Syria, its senior commanders are on the front lines in Syria and Iraq and it was linked to a 2011 plot to assassinate the Saudi ambassador to Washington. The Quds Force relies on Iran’s commercial air fleet to dispatch weapons and military personnel to conflict zones worldwide. Now that the U.S. has allowed sales of commercial aircraft, including cargo jets, to Iranian airlines, the Quds Force will have access to newer, larger, and more efficient planes with which to pursue its strategic objectives.

3.      Delisted IRGC commanders

The deal removes EU and most UN sanctions from top IRGC officials including Quds Force commander Qassem Soleimani, Basij paramilitary chief Mohammad Reza Naqdi and IRGC Air Force Commander Amir Ali Hajizadeh. The delisting will unfreeze their foreign assets and lift travel bans, facilitating their destabilizing activity overseas.

4.      The arms embargo

The agreement delists several IRGC military research and development facilities, including the Research Center for Explosion and Impact. Access to funds and financial services will facilitate efforts to improve Iran’s indigenous military industry – the main source of the country’s military equipment – through additional investment and access to previously sanctioned technology and raw materials. Tehran is already courting Russia in a bid to modernize its aging military, particularly now that the deal calls for an end to the UN arms embargo in five years. It is virtually certain that the IRGC – which has received the lion’s share of Iran’s military investments since the 1979 revolution – will benefit as well.

The nuclear agreement’s proponents insist it offers the prospect of a “safer world.” Unfortunately, much of the windfall it creates will go to an organization interested in anything but.

Emanuele Ottolenghi is a senior fellow at Foundation for Defense of Democracies, where Saeed Ghasseminejad is an associate fellow. Follow them on Twitter @eottolenghi and @SGhasseminejad


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