IRAN-IRAQ: RENEWED RIVALRY

Created: 7/1/1991

OCR scan of the original document, errors are possible

Iran-Iraq:

Renewed Rivalry (u)

Iran-Iraq:

Renewed Rivalry (u)

Iran-Iraq:

Renewed Rivalry (u)

Judgments

tnformatia* natlaelt1 -ai iOrJ I* ihu "jvw.

defeat of Iraq and anendant destruction to its military and economic infrastructure by US-led coalition forces have dramatically altered the balance of power between Iran and Iraq. Tbe reduction in size of Iraq's military machine has. at least temporarily, ended its miliiary ascendancy in the Persian Gulf andough strategic parity between Baghdad and Tehran Iran, formerly isolated and overshadowed by Baghdad's victory in the Iran-Iraq war. now has more room to maneuver and perceives opportunities to regain what it believes is its traditional preeminence in the Persianpm

Tehran probably will capitalize on its growing political influence andrimarily diplomatic strategy to consolidate its renewed regional prominence. President Rafsanjani hasrogram aimed at fostering regional security and cooperation and is attempting to expand Iran's ties to the Gulf Arabs and to the West Iranian leaders probably view President Saddam Husayn as the main threat to their efforts to reshape regional alignments and have embraced the late Ayatollahgoal of ousting Saddam from power. With the failure of the Shia and Kurdish revolts in Iraq. Tehran seems increasingly prepared toolicy of containing Iraq tn hopes that UN economic and diplomatic sanctions will bring Saddam down.^djlft

Iraq has not abandoned its regional ambitions, but the immediate need lo devote its resources to reconstruction, reestablishing domestic stability, securing its borders, and repairing severed political and economic ties to the international community restricts its policy options. Saddam is likely to employ variouspolitical accommodation, cooperation, and. as ihose fail, subversion, violence, and diplomatickeep Iran at bay while he works to tip the balance back in bis favor. ^trT

Tehran and Baghdad have dropped almost all pretense of seeking peace, ending the short-lived rapprochement that occurred in the immediate aftermath of Iraq's invasion of Kuwait inisputes stemming from the Iran-Iraqnotably sovereignty over the Shatt al Arabfrom the Gulfas Iran's continuedof Iraqiunresolved and threaten to increase tension betweenj>t

1

onthact-

Clashes between Iraqi and Iranian troop* along the border are likely toalthough neither Iran nor Iraq willajor offensive military threat to the olher in the near term. Even after its losses in OperationStorm. Iraq has more tanks, armored vehicles, and combat aircraft than does Iran. Iran's Western-trained pilots, however, have alwaysualitative advantage over their Iraqi opponents, and they almost certainly have been emboldened by the Iraqi Air Force's dismalagainst coalition forces. Tbe rearming of the Iranian Air Force with modern Sovietwith continued

^its. ;

emphasis on aggressive training probably would enable Iran tooderate level of air superiority against Iraquture conflict, ^ffi

Domestic economic weakness and tbe lackerious offensive military capability in both Iran and Iraq probably will prevent either from intentionally seeking to re-ignite the Iran-Iraq war over the short term. The danger of an accidentalfairly minor incident between Iran and Iraq escalating out ofincreased over tbe past year and is likely tohronic threat to stability in the Persian Gulf. The ill-planned use of strong-arm tactics by either Iran or Iraq could backfire, and, gives the numerous outstanding disputes between them, thc risk ofwill be high.'-

The narrowed gap between tbe military strength of Iran and that of Iraq gives additional impetus to both governments' rearmament programs. Tehran continues to pursue development of iu missile and unconventional weapons programs as the cheapest way toeterrent capability while it plans to redress the serious shortfalls in its conventional forces. Saddam almost certainlyigh priority to rebuilding Iraq's military might, with the highest priority likely to be the resurrxction of ils missiie and nonconventional weapons programs. Baghdad will not wittingly surrender all of ils proscribed weapons in accordance with the terras of UNnless directly confronted by UN inspectors. Financial constraints and, for Iraq,anctions will stow the pace or rearmament in both countries, although the competition between the two countries will continue to complicate efforts to implement regional arms control.jtjjJh

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IH ACT.

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Cool en Is

Judgments

in

Disputes

Problems

Hostage Air Force

for insurgent Forces

Clashes

Refugees

New MilitaryMore Level Playing Field

ess Daunting Enemy

ough Opponent

ontinued Arms Rice

Ne* EconomicConstraints

Increasing Domestic Pressures on the Economy

Daunting Economic Challenges Ahead

New Political Balance in theAdvantage

and International Influence

Support

of the Ne* Ba.'ance

Opportunity

View From Baghdad

Along the Border

for War

on Regional and Western

Ham*

OS TRact.

Iran-Iraq:

Renewed Rivalry <u(

embargo of Iraq Iran, however, consistently opposed Iraq's occupaiion of Kuwait and rebuffed Iraqi efforu to export oil or import arms via Iran.

Since the end of the Gulf war, Iran and Iraq have abandoned almost all pretense of searching for peace and have resumed active jockeying for politicalMuch as Baghdad perceived Iran's postrevolu-tionary disarray0 as an opportunity to establish Iraq as thc dominant power in the Persian Gulf, Tehran now seel Iraq's defeat as an opportunity to regain regional primacy Thc devastation wroughtecade of war and mismanagement in Iran and Iraqlimit tbeir capabilities and taste for renewed war. but the collision of both countries' inieresu and policies is likely toontinuing source of regional tension. JQ0^

Lingering Disputes

Despite Iraq's many concessioni. tbe rapprochement of0 failed to resolve several contentious issues related to the Iran-Iraq war thatource of continuing friction. These issues include

of the Shalt al Arab. Saddam never explicitly accepted all provisions of thc Algiers accord, and no formal diplomatic instrument was signed reaffirming the validity of5 treaty. Tehran continues to seekormal acceptance, while Saddam hopes to avoid the humiliation of openly ceding half the waterway tocalled for in thelosing control of Iraq's main access to the lea.

af pntonci of war. Byraq had returned virtually all0 Iranian prisoners it held, but Tehran had not repatriated all of the Irani fwienn^r- inullOdt

w

. rbJilcam admuicu pu. in May thai Iraq lacked the rncani to com pel Tehranelease ihem

Iranianprobably accounts for much of thethe taci.es and coordination of attacks onIraq noted since late March

Reparations. Tehran contends Iraq owes iiFor (he damage caused in (he Iran-Iraq war. and the governmeni often reiterates thai thc "rights of ihe Iranian nation" must ben laie March, ihe Tehranrepresents tbe views of Presidentthat Iraq owes Iran MOO billion in war reparations and asserted thai Iran's, cla im^shoii id be paid before those of Kuwail. '"

New Problems

In response, Baghdad has encouraged its forced-ssidents-thehalq-tooperations againsi Iran."

In addition to outstanding issues from the Iran-Iraq war. the Gulf war spawned new disputes that will further impede improvements in Iran-Iraq relations. This new round of problems coincides with theof the UN Iran-Iraq Military Observer Group, which had supervised the cease-fire along the border for more than iwop*

press reports claim Mojabcdin fighters

captured by Iranian forces were directed byinfiltrate into Iran. Baghdad has allowed theto resume radiobroadcasts toduring tbc

The Hastate Airehran's holding of lagand civilianatnd including nearlyercent of Iraq'scombatoriginally flew tosafehaven in1 illustrates tbethe Iran-Iraq relationship to one ofreports indicate that by mid-Aprtl BaghdadTehran to return Iraqi aircraft, but Iran has"

reports indicate attempts to gain the release

Iran ignor of some of the

small

icursions into lranifn territory proba-bly were meant to signal Tehran ihai Baghdad would respond to Iranian provocatiorts.

Border Clashes. Iranian and Iraqi forces haveattacks against each others border positions,eturn to tbe hostile conditions thath, irjQ, Ku^|(

Although Baghdad has

knowleugea maten, US planes io Iran. Iranian officials claim they bold onlyraqi aircraft,

Snpportfo^Msarzen, Forces. Iran has provided

forces have with-

drawn, from Iraniarjiemiory fcilcw:nS forma:

AVWeers. Tehran's leadershipompiained inued Nations and the pfttS isoui thc overwhelming burden (ran hasecause of the influx of moreillior. Iractv primarily from Kurdistan, bui also jomean blames the index oneavy furies repression of the popular uprisings that fallowed the Gulf war. and jovernmen: itatemei'i oliirrs spending SI5 million afore!fa rtllefsupport the refugees is of lata WiyThe Irartun financial claim proba'ci}taajsratss. but Tehran may plan to add this figureowing list of reparations it is demanding treses Bagfadad Moreover, in June Tehran accused Baghdad iitoecond exodus ofouthernevelopment Iran claimedcd its national

The Ne- MiliuryorePlaying Field

These unresolved old disputes and ne*T... .

.rem thai ot on* year ago

ilitaryny- ed tic't eaFcflgjeewhich, had j i a

ver trie Tieiii-c:iai-

iitarj for;es nearhrar i'.tics: -mainlyecade and Sii'ioas jfmW

I'tszmr. Alt Houghmilitarj remainspipped 'ne tignttica'i'the

fraqi Army r. iheCalfhave trcraagga] Ttaart'j

mmptions against Bsjndac.

etpiie

laims that Iraqi fcrcsshijttack on Shi3 arias. Baghdad, whoseewer menid oneadmploy men of its forces to maintain >- inpopulationfos.tce=es*ar> to -seites ike theKhalo. ioIraniannt ia the uprising.

Tahran :i> can can} ost oie attacks arncd it Kcuric* limnedtsIrac tm:peratorIrjci

MWUBLE

'though Iran's equipment shortages and log-sue problemserious impediment tocombat operations, the narrowing of thcgap improves Tehran's chances of rebuilding aa effective offensive capability in thc near term. faJtV)

Imm:ough Opponent. Iraq canormidable force against Iran despite tbe severe losses inflicted bv ground and air attacks during thtfjulf war. _l

WfT'e Iran s

exploitation of Iraq's more vulnerable

sometimes threateningsecurity

has been the focus of the weakened Iraqi military in

the immediate aftermath of the war. and Baghdad }

appears especially concerned with reestablishing

nty along the Iran-Iraq border For example, Iraqi '* ' /

Army unils moved forcefully in March. April, and

May to stop insurgent attacks from Iran, resulting m

some clashes with Iranian forces and. apparently, the

temporary occupation of tome Iranian territory^fi>'

- Although Iraq might experience

some tactical defeats in tbc early stagesar. Baghdad probably could mass iu ground uniu againsi Tehran's less mobile forces to stop an Iranian attack. In addition, the better organized, supported, and trained Iraqi ground forces almost cenainly would perform better against ihe Iranians than tbey did against the superior US-led coalition forces. Iraq's greatestprobably would be sustaining combateriod of months because of its serious economicand the impact of tmemational sanctions ^p*

Iraq's armed forces probably cannotajor offensive threat to Iran for at least several years. Iraq's postwar combat power is less than half of what Baghdad had a: the end of ihe Iran-Iraq

Baghdad's forces almost certainly could defend Iraqi territoryajor Iranian offensive.

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Tehranursuing development of iu missile and unconventional weapons programs as theoeterrent capability whde it plans to redress the serious shortfalls in its con-

Iran is entphastang ihe ?rxjrcTr.cnt ot chemical precursor and weapons fabricationhoping eventually tohemical warfare capability that rivalsjoS

We believe Saddam Husaynigh priority to rebuilding Iraq's miliury might. Following the Iran-Iraq war. Iraq bad overwhelming superiority over iu neighbors but continued to huild up iu miliury inventory, focusing on prpducirig weapons of mass destruction andclf-sumcieni military-

' Ira*so op-ratc aodar she caiuarmias ofarms ea*aar|ocsi| ihr Ion-Iraq

Tb* New EconomicCetasmieu

Economic realities may be ihe most serioushow far thc renewed competition betweenTehran will go Both countries haveminimal foreign exchangelimited ability to increase revenue orcapital. Moreover, both nsk popularthey demand additional sacrifices fromcitizens to pursue 'heir /J

Iran: Increasing Domestic Pressures on the Economy. Iran's economic outlook remains grim despite some temporary financial relief during the Guif_war Iran has limited foreign exchange resci

id its en! export revenues1 will fn]

well shorl of Iran's requirements. The public isincreasingly frustrated with ihe lack of economic progressecade of self-sacrifice and austerity and expects improvements in living conditions.among teachers and factory workerseconomic conditions led to strikes and demonr^ations during the past year, and government workersthat the rising cost of living has forced them to Uke two or three jobs to make ends1illion withillion people added every sevengraduallythe country's health, housing, education, and transportation sectors In addition. Iran faces high inflation and serious unemployment, bothto be at leastercent, and unemployment is likely to continue to rise given the growth rate and age composition of the population.

Tehran probably will seek increased levels of foreign financing io help deal with us financial problems, but many investors are nervous about Iran's political stability and economic outlook and are reluctant to provide large-scale or long-term financingTehran probably hopes the improvement in its internationala result of its policy dunng the Gulfits move to restore tiesu Arab neighbors and to West European countries will help it attract foreign capital.

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Tehran's effofis have roc: *nh wove success.such as Japan. France, Italy, and Germany arc begin rung to reconsider iheir economic policies toward Iran, citing Rafsaniaru's more realisticnd political policies as the major impetus for thc move For example, in1

Japanese Foreig- Minister Nakayama moved to grant loans for development and industrial projects, and Japan plans toechnical team to Tehran to assess individual pre 1

> France agreed toongstanding financial dispute, paving tbc way for future cooperation.

German Foreign Minister Gcnschcr expressed Bonn's willingness to expand economic cooperation with Iran. Thc German-lran Jointeeting in1 to discuss future investment, technical cooperation, and ex-Parisian of Bonn'* expon insurat

Iraq will encounter difficulty obtaining the necessary foreign financing, goods, and services to rebuild its economy, especially while UN sanctions remain in place. Baghdad will be unable to secure significant new foreign credit because of its dismal payment record on itsillion in non-Arab debt and the poor prospects for future debt payments Although the Iraqis can probably rebuild much of their infrastructure with domestic materials andmost damaged industrial facilities useespeciallyand technology Most foreign governments and companies probably will

Foreign exchange stringencies, coupled with theimportance pUced on economic development, will limit the military's share of governmentTehran cut defense spending nearly in half after thc Iran-Iraq war. and current levels probably are thc minimum needed to continue the slow but steady buildup of thc Iranian military Tehran probably will conlinuc to rely heavily on oil and natural gas barter deals io obtain needed miliury equipment and will allot scarce bard currency for high-technology items Cash deals almost certainly will be subject to lengthy negotiations. An increasing demand for oil and gas ir Europe, coupled with Tehran's opening to the West, could allow Iran to make additional miliury

Item: Deumtint Economic Ckmlltmgn Amend. The

Gulf crisis set back Iraq's economic developmentIn addition to its own civilianwe estimate would cost atif

Iraq were to completely repair -ar-damagedBaghdad almost certainly will have to paytoestimates range as highell as compensation to

miliury reconstruction, will stretche-tourer lo ihe Umii. (rat; Bill probablyhe next few years on rebuilding infrastructure ihai It esscn:tal to civilian its miliary reconstruction

laeMJ).

Tat New Political Balaacr in :beAdvantage

One of the most profound erTscta of ihe coaliuon victory over Iraq was ils impact on (he relative political influence of Iran and Iraq. The war provided Tehran lhe opportunity to increase its polilical capita) abroad at Baghdad's expense Tehran's success is such thai officials in several Middle Eastern stai;

ouni Iran as orHfThc^rue^crl^^^

Gulf conflic

refuse to participate in Baghdad's reconstruction any lime soon Even after the embargo is lifted, ihey are likely to hesitate toole because of doubts about Iraq's ability to pay and political stabilityg}*h

Severe financial constraints and enormouscosts, combined with the UN military embargo, will prevent significant progress during al least lhe neat few years on tbe mulubillior-dollar task ofIraq's military facilities and replacinglosses. Civilian reconstruction will preoccupy Iraq through the rest of the decade and. combined with

Regional and Iait,nalional Inffuenct. Iraqiior. against Kuwait improved internationalof Iran as Baghdad eclipsed Tehran as the mam threat io security tn tbc Persian Gulf In theirtatements Iranian leaders have sought io exploit this changeindication of Iran's long war with Iraq.Iranian diplomacy during ihc Gulf crtsis scugbi to establish Iranesponsible member of the international community and boost its standing in thc West, with on ^BLaVaVanaSunVw

successful. tcjyi'V'

Tehran capitalized on its new respectability to achieve long-held diplomatic objectives. Iran, long isolated for its intransigence is thc Iran-Iraq war and iu support for terrorism, has greatly expanded or upgraded its diplomatic relations with several Arab and Western cou.itr.es Of particular importance to Iran was the restoration of diplomatic tics to the United Kingdom inhich in the foi Sowing month led to (he lifting of diplomatic sanctions placed on (ran by

the European Community. Since ibe Iraqi invasion of Kuwait, Iran hu restored diplomatic relations with Iraq. Saudi Arabia, and other Arab tiaiea. regained the right to tend pilgrims on the bay to Mecca, and opened an interests section in Egypt Tehran now can deal directly with all the major participants in Persian Gulf affairs, wiih the exception of tbe United States.

Iraq, by comparison, has seen its diplomatic circle of friends shrink. It has broken relations with the United States.gdam. France, and Saudi Arabia, among others, and iu erstwhile patron, tbe Soviet Union, has been unwilling to support Iraq in the Unitedesult, Iraq -as forced to submit to humiliating UN resolutions toease-fire with coalition forces Saddam has found

himself isolated from thc most influential Arab states, and even Bagdhad's staunches! supporters during the crisis. Jordan and Yemen, have moved since February to put distance between themselves and Iraq and ingratiate themselves with theW

Domestic SigafaM Thc war changed both Iran's andomesticettent of Iranian policy during the war enjoyedsupport and allowed him to consolidate his autbc

Iranian policy will continue to reflect the constantly shifting domestic powerin Tehran. Rafian,ani's domestic strength should allow hirngreaier flexibility in bis conduct of foreign poiicy^grtF:

Although Saddam skillfully and brutallyposition in tbe face of extensive revoltsKurds and Shias in March and his regimehe remains deeply concerned wiih ensuringpolitical survival. Unrest continues inIraq and Kurdisian. and.<

'in Bagh-

dad include numerous roadblocks and frequent neigh-borhood raids to ferret out Shia rebels and their Supporters.onsequence of ihis unrest, we believe Saddam will be preoccupiedaintaining domestic order this year, and much of his foreign policy will be dnven by the need to obtain benefits-such as the lifting of economicwill assuage domestic angerJ^jjqC*ocl

Implications of tbt New Balance

Both Tehran and Baghdad are adapting their policies to the changes wrought by the Gulf war. Saddam aiaiost certainly has not abandoned bis long-term goal of achieving preeminence ia lhe Persian Gulf and the wider Arabbut the damage inflicted on Iraqi

10

hasis policy dlCtCfl rthrir;

lis greater freedom if action iofShBal oraer tha: favors Iran and to establish its srserniseiwa In the Gulf Both countries'ominate :haand 'he Xvab*tfl ensure :ia'. thatr jroliciescollide frequently, ai-houghaurv tfltt' continued seanomic and aulitary weak-iess may limn their competition in thc near term ^jp^pjpfc,

as

nsiorii

tponunify. Tehran airtvit: snwi*<<

J2!n

nd Ktwjrrcc lEcrcenirtas. 7sa-

ran is tics: EM] ta jasiiaiuta on its initial sssylna'cal

iichaascaoenpigv-

tjy to aansciicats its nsevsd reitortai prwrJaeMf.

Xafsaa;arii jaftUaaed, sues a ;

. His prsfrsm rx ^Ces oitUJ:

rssrjirjiinlf aiiec jr.shares Inter aaanc escsceitc dafralopnasi

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cooperation among Guff countries inoilpeaceful resolution of disputes, ind noninterference inaffairs.

to any effort byegional country or tbc United States to impose hegemony on the(ran. as tbe "focal point of tbe region and standard bearer oflearly would be thc leading regional gap'"'

We believe Rafsanjani perceives iwo main obstacles to his effortstablish Iran's regional ascendancy the United States and Iraq. In overcoming USRafsanjani's public comments suggest he expects Iranian efforts to promote regional order willobviate US interest inilitary

'

.-.

cauiking on US public opinion and diplomatic support from the Sovieu and,esser extent, from the West Europeans toreatly expanded US presence in tbei jfff^

Tbe perception in Tehran appears to be that Iraq under Saddam Husayn representsontinuing challenge to Iran's bid for regional leadership and an inherently disruptive force in the Persian

In our judgment, Iranian leaders perceive these problems to be threefold:

Domestic instabilii

, thc Iraqi

revolt threatened to turn Iraq into another Ubanon that would affect the region for years.

Iraqi tipanjiorusm Citing the parallel experiences of Iraq's invasion of Iran0 and iu invasion of Kuwaitafsanjani has pubiiely identified the Iraqi Ba'th Party's "spirit of expansion and aggression"oot cause of disunity and insubil-ity in ihc Persian Gulf-

attS-iin's oft-stated concern (bat such instability increases the likelihoodrolongedespeciallypresence in the region.

Ideolofy

Tehran views thc Ba'tn Party's Pan-Arab pJatf.irmhallenge to non-Arab Iran's emphasis on Islamnifying principle for thc Persian GulfWe bdieve Iran is eagerid theof an anti-Iranian bloc based on Arab solidarity similar to the one it faced during the Iran-Iraq war

Tehran's focus on Saddam's regime in Baghdad as lhc source of iu troubles in the Persian Gulf bas led it to embrace the late Ayatollah Khomeini's unrealized aim of ousting Saddam Husayn from power. Top Iranian leaders appear ia agree on this issue Supreme Leader Khamenei and ihe leaders of the legislature and judiciary have all issued calls for Saddam's removal. Rafsaojani has been more curumspeet inhas denied calling for Saddam's resi-.ni'

Unlike Kjaceneini. tbe current clerical regimerecognizes tbe limits on iu ability to bring down tbe Iraqi Ba'thists, including:

oi agaajgj clerics andpublic are weary of war andpolicy of neutrality during Operation

governmcni almost certainly docs not want to squander this support by deliberately seeking war with Iraq. Iran demonstrated restraint in March when, during tbe Shia revolt in Iraq, it limited iu response to Saddam's destruction of Shia holy shnoes and the arrest of Grand Ayatollah Kiu" to diplomatic and religious proiesu.

i So 4ismtmhermtni of Iraq Throughout the Gulf crisis Iran has consistently opposed atsauiu on Iraq's territorial integrity, even criticizing Western

gatf

sugzest that these two decisionmakers aoiCiews on how much support to giveraqifaSSBB^MBaaBi>a

[These differe;

are li'pical of the constant friction between the two leaders over the past decade and are not trough to thrcaicn thc rcgimc'i unity. In theRafsanjani and Khamenei haveompromised, but. ifhouldo do so now. it would threatca the coherence of Iranian policyorstack of compromise at the top might provide openings to Ra:san;an and Kaamene-.'t hardline opponents to criticize their handling of foreign policy anduh ly drcumscrtcc their room to maneuver,-

Thc fie* From Baghdad. Baghdad probablyemporarily subordinate its regional ambitions and try to maintain stable relations with Iran while it rebuilds Iraq's shattered military and economy. The new regional miliary balance has reduced Bagndad'sto restrain Tehran's regionai ambitions or stop it from meddling in Iraq's domestic affairs, Iraq'sneed to devote its resources to reconstruction, reestablishing domestic stability, securing its borders, and repairing severed political and economic lies to iu neighbors and the West restricts its room forSaddam is likely to employ variousincluding political accommodation, cooperauoo. and diplomatickeep Iran at bay .while he works tn tip the balance back tn his favor, i

Despite Iraq's weakness. Saddam's old ambitions remain, and be almosi certainly seeks revenge for hu defeat in Kuwait. He has not abandoned bn search for regional supremacy and eventual domination of Gulf, Arab, and OPEC affairs, in our judgment. Baghdad is increasingly concerned that Tehran's growing ties to the Arab Guif states will leadegionalty arrangemcm that excludes Baghdad Recent Iraqi press articles assert that the country's remaining military power, abundant Oil reserves,h eat.oral hern age and Pan-Arab spint entitle Iraq to an important regional roic. Iraq's desire to gain

13

usaym

more secure access lo theof the reasons Saddam invadedan importantambition and will continue to make the status of the Shatt aloint af contention

Iran's opportunity to regain regional primacy isworst fear. The emerging new balance of power is reminiscent of the, when Iraq, relatively weak, isolated, and beseturdish rebellion, was forced to sign tbe Algiers accord with Iran, giving Tehran joint sovereignty over the Shatt al Arab waterway and ending support for each other'sgroups. The Iraqi victory in the Iran-Iraq war. although costly, allowed Saddam to claim that he had restored Iraq's sovereignty over the Shatt. This gain was relinquished during tbc Gulf war, and once again Iraq finds itselfisadvantage with (ran and with few bargaining chips available to settle bilateral disputes to its satisfaction. To help regain some of its lost leverage, Baghdad is trying to reengage the UN Secretary General and tbe UN Iran-Iraq Military Observation Group in monitoring tbe cease-fire,alleged Iranian cease-fire violations, and settling outstanding bilateral

Iraqi propagandists continue to exploit deep-rooted Iraqi fears of Persian domination to rally support for the regime, Saddam probably hopes that emphasizing

the Iranian threatelp him maintain the loyalty of the military leadership and the country's minority Arab Sunni Muslim population, whose interestscertainly would be gravely threatened if an Iranian-sponsored rebellion by Iraq's majority Shia population succeeded. Thc government-con trolled press routinely charges Tehran with plotting tour

Imost certainly will try to play thc Iranian card with Gulf Arab and Western states in hopes of convincing themesurgent Iran and the specterhia-dominated Iraqreater threat to regional security than does IraqJ-fjW'ft

Thc outcome of (he Gulf war and the Iraqi rebellions almosi certainly have reinforcedmany of hisbelief that Iraq is surrounded by enemies intent on its destruction. Any likely successor to Saddam, military or Ba'thist, is likely to share his vision of Iraq's regional destiny and will seek to quickly rebuild the country's polilical and miliiary might to face real and imagined threats. Thc Sunni Muslims who most likely wouldost-Saddam government would probably carry out his Pan-Arab and nationalist agenda to meet the long-term challenges of forging national unity, securing Iraq's long border with Iran, and surmounting the country's strategic and economic vulnerabilities in the Gulf. They probably would not alter significantly Iraq's polilical system to avoid being submergedhia-dominated political culture susceptible ioSyrian, or other foreign meddling and to avoid being perceived as acting under the influence of an outsidefrTf

Saddam's preeminent goal almosi certainly will be to guarantee his survival as leader of Iraq. His near-term focus will be on reestablishing domestic stability, protecting Iraq's territorial integrity, and rebuilding ties to the Arab world and the internationalHe probably will rely, as he has in the past, on a

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combination of tactical compromise and ruihlesslo maintain domestic tranquility He is likely to try to quickly reconstitute hii border forces to secure Iraq's frontiers against subversion. Theof Iraq's military resources and the added dilft-cully ofarge numbers of refugees,and rebels along Iraq's borders "ill significantly complicate lbc task.

Baghdad probably "ill try to break out of its isolation and rebuild bridges to the Arab world and the West to gain humanitarian and reconstruction aid and to forestall the improvement of Iranian ties to the Gulf states at Baghdad's expense Of primary concern will be improving relations with Turkey and Saudi Arabia, where Iraq's two major oil outlets are locatedalmost certainly realties that many countries will be unwilling to normalize ties and participate in reconstruction while be remains in power Hehopes that thc lure of postwar commercialin Iraq and his promises to share power and enact broad politicalelp overcome such reluctance. In addition. Baghdad probably will not abandon its use of threats and strong-arm tactics in foreign As^

long ihe Border. Tensions along the Iran-Iraq border are likely to increase considerably over ihc near term as Tehran and Baghdad pursue con-Dieting policies. Iran's meddling in Iraq's internal turmoil, its unwillingness to return Iraqi aircraft, and its continued holding of Iraqi prisoners of war have eroded the facade of friendship established during the Gulf crisis. Tensions along lbc border probably wall simmer as both sides jockey for advantage

Limited military incursions will become increasingly more likely Tehran may limit its direct participation in insurgent atucks to advisers, fearing greaterwould scare iu Gulf neighbors andIran's chances of participating in future Gulf security arrangerncnu. In any case, radical elements of tbc Revolutionary Guard, deployed along thc Iraqi border, probably will support small dissidentwith or without authorization from Tehran. Baghdad probably will respond to Iran's actions and policies, and it will continue to defend iu interests using any means at iu disposal, including military

force.halq operations and limited Iraqi atucks along the Iranian border as well as Iraq's effortseal its border against rebel infiltrations win bring increasing numbers of Baghdad's forces back to the Iranian border, in close proximity to Tehran's "OOP* ty&t

Prospects foe War. Despite thc deterioration inbetween Iran and Iraq since the end ofDesert Storm, we doubt thai, for ibe near term, either Iran or Iraq will launch deliberate large-scale military operations against tbe other Neithererious offensive military capability at this time, and both the Iraqi and Iranian economics wouldiflkult timeajor conflict .jsj*Fl

The danger of an accidentalfairly minor incident between Iran and Iraq thai escalates out ofincreased since the end of ihe Gulf war and is likely tohronic threat to subiluy in the region. Baghdad almost certainly will resort to iu historic practice of intimidation. Tehran, with its regained initiative, probably will not submit easily to ihreals or cnercieeL Thc til-planned use of strong-arm uctics could backfire, and, given tbe numerousdisputes, the risk of miscalculation will be high. Several issues could sparkrisis, including:

Demarcation of lhe Shatt al Arab. Tbc end of the Iran-Iraq rapprochementormal settlement of this dispute less likely in ihe near term. Clashes could erupt should either side attempt to enforce its claims along tbc waterway.

Support foe" insurgents Iranian Revolutionary Guard troops already have raided Iranian drssidenu based in Iraq, and continued Iranian support for Shia rebels could provoke frustrated Iraqiinto bet pursuit against rebel positions across the Iranian border. Alternatively, should serious unreal break out in Baghdad. Tehran might calculate that Iranian miliury intervention would tip the balance in favor of the rebels and yield an easy victory

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Am Alternative Outcome: Iran-Iraq Detente

believe relations between Tehran and Baghdad will remain ttrained for tke foreseeable future,ess likely scenario can be envisioned in whichbetween the two rivals could becomemore cooperative Saddam's ouster orommon threat from lhe coalition powers are two factors thai might increase the likelihood of such an outcome.Jeg/ejT

The short-lived rapprochement between Iran and Iraq during the Culf crisis demonstrated that bothare capable of setting aside their differences to achieve specific policy objectives. Moreover, both countries share certain interests that could form the basis for cooperation These include

Policy. Both Iran andmassiveneeds and severe financial

favor higher oil prices. Before the Iraqi invasion of Kuwait. Iron endorsed Iraq's efforts to pressand the United Arab Emirates to cut oil

production and raise oil prices.

to Western, particularly US. influence in tbe Persian Gulf. Although Iran and Iraq view each other as rivals foe primacy in the region, they almost certainly recognize ihai USinSthe region could frustrate their efforts to achieve hegemony They might find it expedient to form an alliance to counter US influence, especially if they perceive postwar security arrangements In the Persian Culf toS-backed cordon aimed at excluding them from exercising influence in the region.

to Israel. Both states view opposition to Israelundamental principle of their foreign policy. Following Iraqi missile attacks on Israel

during Operation Desert Storm. Iranian officials publicly acknowledged that Israeli retaliation would force Tehran to reevaluate Us policy of neutrality, and particularly aggressive Israelipreemptive strikes on Arab states rather than Palestiniancause Iran and Iraq to work together

Opposition to monarchy. Both Iran and Iraq oppose monarchies on ideological grounds and consider those in the region to be antiquated Both countries maintain diplomatic relations with some of the Arab monarchies and would be more likely to act lomity in oppositionhe monarchies if theyeal threat to their national interests, sucheliberate Qulf Arab policy of driving down oil

Saddam's replacementore pluralistic repme in Baghdad could significantly alter the relationship between Iran and Iraq We believe much of Tehran's distrust of Iraq is focused on Saddam and the Ba'th Party, and it might easeore representative regime come to power In Baghdad. Rafsanjani has stated ihai. if Baghdad broadenedin ihe government. Iran would cooperate with Iraqi reconstruction efforts. Eventhis scenario we would expect Iranian ambitions. Iraq's Arab identity, and ideological differences lo prevent the emergenceehran-Baghdad alliance, although tensions between ihe two probably would decrease. Evenuccessor Iraqi government were dominated by Shias. it probably would be wary of domination by Iran. Most Iraqi Shias do notIO Irani brand of politicized Islam. Omj/eJ

Reparations. Should Tehran believe iu demands for compensation for (he Iran-Iraq war are beingil might tryeize valuable bus of IraqiMajnun oilfield in southern Iraqbe especiallyforce Baghdad to

pay reparations. Iran occupied much of lhe fields

during thetT

During the next several years some of Ihe constrainu on Iranian and Iraqi behavior are likely to diminish. If Saddam consolidaies his domestic position andsanctions are eased, Iraq almosi certainly "ill become more adventurous. In several years Iran will have integrated significant numbers of new Soviet equipment into tu military inventory, increasing its offensive capability. As these constrainu are reduced and lhc political rivalry between Iran and Iraqtbe danger of war between the two countries will grow.

Impact on Responal aad Western Inlernts

The (ccmergence of the Iran-Iraq rivalry may yield sbon-ierm uctical advantages to other countries in (be regsoa. Many countries may welcome tbe tensionay of diverting Iranian and Iraqi energies from regional adventures. Over thc long term, the costs of continued instabjjjty in the Persian Culf arc likely to be onerous. (SjfjW)

To tbe extent that the Iran-Iraq rivalry distracu them fromhc affairs of thc Gulf stales, the Gulf Arabs may find (be renewed tensions tolerable. Both Iran and Iraq are likely to court the Gulf states to gam at tbe other's expense, providing the Gulf Arabs greater room to maneuver.

significantly, for example. Tehran might decide that the best way to gain an ally in ibe Gulf ol to topple one of the conservative monarchies andhia or Sunni fundamentalist regime in iu place Jsyfli

The rivalry between Tehran and Baghdad willowerful stimulus for continued cooperation between Iran and Iraq's main Arab rival. Syna. Both Tehran and Damascus fear Iraqi expansionism, and, as long as Saddam Husayn remains in control of Iraq, both countries are likely io cooperate to contain Iraqi ambitions. The value of this alliance will diminish should Saddam fall from power. In that case. Syrian antipathy toward Saddam will be replaced bythat Iranian influence inihai of Islamicgrow io threateninterests (aa*?'

Egyptian interesu will be less directly affectedtensions than those of Syna or tbeTo thc extent lhat Tehran and Baghdadon their bilateral competition, themay provide opportunities for Egypt to pose asstable, less threatening alternative to Iran and artner to (be Gulf states. Cairo mayexploiting these opportunities shouldtensions lead to complacency in Gulfthe need to cultivate close relaiions withpower capable of assisting the Gulf states to .Iranian or Iraqi pressure

long as Baghdad and Tehran try to gain advantage over each otber by courting tbc Gulf Arabs, the Iran-Iraq nvalry may reduce the foreign threat to domestic stability ut the Gulf states. Over time, however, tbc danger will grow that either Iran or Iraq will tire of tbc Gulf Arabs' neutrality and may seek to influence ibeir policies through tbe threat or emptoymeni of subversion or terrorism Should conditions deteriorate

Over the long term, the Iran-Iraq rivalryerious threat to the stability of the region. The continued arms race between Tehran and Baghdad

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almost certainly will make efforts toegional arms control procram especially difficult. As cacti couniry rebuilds itsmissiles and unconventionalwill increase (hc ussecurity in the re-ion and spur proliferation of such weapons As long as the disputes between Iran and Iraq are unresolved, thereanger that one or tbc other mightonflict aimed at drawing in outside powers in hopes they would bring pressure to bear toasting settlement. Renewed war would once again threaten to polanze the Culf states and endanger the sccuniy of Weslern oil supplies.

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Original document.

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