Debates In Tehran Continue Over Iran-US Prisoner Deal

In a meeting with a group of senior IRGC officers and Basij paramilitary leaders on Thursday, Khamenei described the Revolutionary Guard as “the largest counter-terrorist organization in the world,” while international calls to designate the group as a terrorist outfit have been echoing across the political landscape of many countries.

Reacting to Khamenei’s flattering words, hundreds of Iranians rushed to social media to point out that the statement is accurate as long as the prefix “counter or anti” is removed from the word terrorist.

Washington designated the IRGC as a foreign terrorist group in 2019 and US lawmakers have made repeated calls to their allies to prioritize designating the group as such. In May, a bipartisan group of US congresspeople sent letters to the heads of US-allied nations -- the UK, Australia, Canada, and India – to reiterate calls to swiftly act and officially sanction the IRGC in its entirety.

Despite numerous pleas by politicians, diplomats, opposition leaders and activists, the UK and EU are still hesitant to proscribe the entity, which has proved to be the most destabilizing element in the Middle East region and a big threat to American and European citizens in the world, as well as the main suppression force in Iran.

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During the meeting with his most important base of support, Khamenei warned of attempts to besmirch the IRGC and Basij forces, saying, "One of the important aspects of the enemy's activities is tarnishing the image of the IRGC. and the Basij; why? Because the Guard is awe-inspiring, the Basij is impressive, which makes them worried and anxious."

Elsewhere in his remarks, Khamenei emphasized that the US is the main enemy of the regime, saying that one of the past mistakes was not recognizing the US as ‘the enemy.’ “We must raise our voice against America,” he said.

The blandishment by the Supreme Leader came as many Iranians are planning to hold anti-regime protests to mark the anniversary of the Women, Life, Liberty movement, Iran’s biggest popular uprising sparked by the death in custody of 22-year-old Mahsa Amini in mid-September.

Khamenei depends on the IRGC and Basij to defend the main bastion of the regime as he cannot trust the traditional Army, which has been kept weak. However, minutes of a meeting of senior clerics and IRGC commanders with Khamenei, leaked to the media in March, indicated the negative impact of the protests on the morale of forces under the command of the IRGC and their burn-out, with several offering anecdotal accounts of insubordination. 

“It is a well-equipped military organization. It is an efficient and independent organization capable of carrying out tasks that many of the world's major militaries cannot accomplish,” Khamenei stated during the Thursday meeting with the Supreme Assembly of Commanders of the IRGC.

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IRGC’s extraterritorial Quds force leads activities of regime’s proxy forces against the United States, Israel, and other adversaries in the region and beyond. The IRGC is providing drones and missiles for the Russian invasion of Ukraine, and is also involved in assassinations, kidnappings and cyberespionage operations across the globe.

The outfit is also behind drugs and arms trafficking and money-laundering and other cases of economic corruption both in Iran and abroad. The IRGC is also the main force to suppress any critical voice in Iran with its members unofficially exempt from due process in case of wrongdoing and corruption.

Over 500 Iranians have been killed by security forces, mainly consisting of the IRGC and its Basij militia, during the crackdown on the last year protests, which may resume throughout Iran in the coming weeks.

Numerous politicians across France, Germany, the UK, and other European nations are eager to push for the designation of the IRGC, asserting that it has been significantly delayed. Resolutions have also been adopted in their respective parliamentary bodies, underscoring the pressing need for the IRGC's designation. However, both UK and European governments perceive this step as a potential impediment to diplomatic engagement with the Tehran regime.

"There is a heightened threat, a heightened risk to regional mariners in terms of seizures" by Iran in the strait, Commander Tim Hawkins, spokesman for the US Navy's Fifth Fleet said Wednesday.

A deal announced a week ago will see five US citizens held hostage in Iran to leave the country in exchange for the United States agreeing to release $6 billion dollars of Iranian funds frozen in South Korea due to sanctions.

The deal is said to be a first step to reduce tensions with Tehran, but the US Navy has been beefing up it forces in the Persian Gulf to prevent attacks by Iran’s Revolutionary Guard on commercial shipping, especially in the Strait of Hormuz.

"Right now, our focus is on … increasing our presence in and near the Strait of Hormuz to ensure security and stability in a very critical waterway," Hawkins told AFP at the US Naval base in Bahrain. This casts a shadow of doubt on the theory that tensions with Iran would ebb by a prisoner release in return for its frozen assets.

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This is the second warning issued by the US Navy in less than a week, when a naval coalition in the region led by the United States warned ships to stay away from Iranian territorial waters.

"The International Maritime Security Construct is notifying regional mariners of appropriate precautions to minimize the risk of seizure based on current regional tensions, which we seek to de-escalate," Commander Timothy Hawkins, spokesman for the Bahrain-based US Fifth Fleet, said late on Saturday. The US Navy has deployed squadrons of F-16 and F-18 warplanes, more warships, and Marines to its forces in the region since early July, a sign of serious concern over Iran’s intentions.

However, multiple media reports indicate that the deal to release $6 billion from South Korea for the US hostages might be the prelude to more informal agreements between Tehran and Washington. In fact, the US has also agreed to Iraq releasing around $11 billion of Iranian funds frozen at its banks, and Japan appears to be the next country to release $3 billion.

The Biden administration on a track of secret talks to convince Tehran to perhaps put a temporary cap on its uranium enrichment, denies any informal deals.

The State Department without denying secret talks said, “we are not close to any kind of deal. We do not have any kind of agreement.” A spokesperson asked during a press briefing to categorically deny that there is an unwritten or informal understanding with Iran said, “Iran must first de-escalate to create any kind of space for future diplomacy. But at this time, we have – do not have any kind of agreement on any purported nuclear agenda.”

However, The Wall Street Journal reported August 11 that “Iran has significantly slowed the pace at which it is accumulating near-weapons-grade enriched uranium and has diluted some of its stockpile.” Also, if there were no secret deals beyond the release of hostages, the US would have hardly agreed to the release of $11 billion from Iraq and possibly more from Japan. Without a larger deal, the total amount would mean that the Biden administration paid more than $3 billion for each hostage, a historic ransom.

Whether Washington reached only a hostage deal with Tehran or a wider informal nuclear agreement, it knows that none of these means Theran has deescalated. Hence the warnings to commercial ships traversing the Persian Gulf.

The health ministry’s food and drug administration website announced last week that it will no longer issue permits for production or imports of pregnancy associated plasma protein-A (PAPP-A) and free beta human chorionic gonadotropin (Beta-hCG) test kits. 

Media have also reported that the ministry has been refusing to allow production or importation of enzyme linked immunosorbent assay (ELISA) tests. 

These tests usually carried out during the first trimester of pregnancies are used to identify and assess the risk of various congenital conditions such as Down Syndrome and fetal aneuploidy (chromosomal anomalies) such as trisomy. 

When asked about the discontinuation of the production and imports of these kits on Monday, the ministry spokesman, Pedram Pak-Ayeen, claimed that there was no ban and fetal screening has only been “standardized”.

The spokesman’s denial of the ban does not seem to be convincing to many including genetics experts and women’s rights activists who say denying them to women to preclude possibility of abortion is interfering in people’s personal decisions and violates women’s right to their bodies. 

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Calling the ministry’s decision “shocking”, Dr Mohammad-Amin Tabatabei, a member of the board of directors of the Iranian Genetics Society, said Monday that Iranians will be facing a greater risk of babies born with congenital and genetic anomalies due to the ban.

Tabatabaei stressed that the ministry has not consulted the genetics society and that the society will officially protest to the decision soon and demand a re-evaluation and warned that the ban could result in illegal imports of “notoriously expensive kits of uncertain standards.” 

“Until now we had underground abortions, now we are going to have underground screening too,” a medical professional, Dr Mohammad Mir-Mohammadkhan, said in a post on X (former Twitter) Sunday. 

Abortions have always been illegal in Iran, but termination was allowed during the first 18 weeks of pregnancy if the fetus was diagnosed with genetic disorders or carrying the fetus to term threatened the mother’s health or life. 

On April 17, Soleiman Haydari, an official of the health ministry, told the Iranian Students News Agency (ISNA) that annually as many as 10,000 abortions were legally carried out.

In the past ten years the Iranian healthcare system has hugely limited screening tests and legal abortions and completely stopped its decades-old family planning programs. 

Iran’s primary healthcare program had introduced several screening tests In 1991 that were routinely carried out as part of the existing mandatory premarital blood tests to prevent and control non-communicable diseases which have now been abandoned. 

The government has also banned the sale of contraceptives and taken tough action against doctors and midwives who assisted terminations outside the healthcare system and shut down their clinics. 

In July 2022 the health ministry announced that it had established a portal for medical professionals to register all pregnancies as a preventative measure against illegal abortions.

Iran's Supreme Leader Ali Khamenei believes efforts to increase the country's population are among the most urgent duties and essential policies of the Islamic Republic as the leading Shia country in the Muslim world and has repeatedly demanded that the population increase to 150 million. 

The childbirth rate in Iran has been steadily declining over the past few decades. In the early 1980s, the population growth rate reached 4.8 percent. This rate has dropped to below one percent in the past decade. 

Iran's population has doubled from around 40 million in the early 1980s to 84 million, but a declining birth rate means the median age at 32 is about the same as Saudi Arabia at 31.8, but higher than Iraq at 21. 

In a letter released on Wednesday, the bipartisan group of US lawmakers from the House and Senate have asked the Biden administration to address “unprecedented intimidation” tactics from Iran that have prevented the transfer of seized oil from Suez Rajan, a tanker anchored off the coast of Texas, near Galveston about 50 miles (80 km) from Houston.

The letter was organized by Senator Joni Ernst (R-IA) and Representative Elise Stefanik (R-NY) and signed by Sens. Richard Blumenthal (D-CT), Lindsay Graham (R-SC), Bill Hagerty (R-TN) and Kevin Cramer (R-ND) and Reps. Josh Gottheimer (D-NJ), Jim Banks (R-IN), Don Davis (D-NC) and Max Miller (R-OH).

The US seized the Iranian oil onboard the ship late in May in accordance with the US sanctions, but the oil has reportedly not yet been offloaded as US federal prosecutors have faced challenges in auctioning off the 800,000 barrels of oil aboard the Greek tanker. The lawmakers estimated the value of the oil to be $56 million. 

According to the Wall Street Journal, the US companies are reluctant to unload the oil due to concerns about potential Iranian reprisals, particularly threats of violence by Iran’s Revolutionary Guards. Iran's IRGC navy commander Alireza Tangsiri warned in July that Tehran would retaliate against any oil company involved in unloading the Iranian oil. 

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“Companies with any exposure whatsoever in the Persian Gulf are literally afraid to do it,” said a Houston-based energy executive involved in the matter in July. 

Noting that the enforcement of sanctions will become irrelevant if American citizens and companies involved constantly live in fear of Iranian retaliation, the letter reads, “The ability for a designated Foreign Terrorist Organization (FTO) to prevent the transfer of seized assets within US territorial waters is an unprecedented intimidation effort that threatens to undermine our Nation’s security.”

“Current public reporting that such an operation cannot be completed due to Iranian threats against US companies and persons undermines the success of this seizure and imperils the US government’s ability to successfully complete future seizures,” added the lawmakers. "It is imperative that the Administration make clear that Iran and designated Foreign Terrorist Organizations cannot prevent our government from carrying out legitimate law enforcement operations."

US seizures of Iranian oil contribute money to the US Victims of State Sponsored Terrorism Fund (USVSST Fund), which compensates victims of attacks. The current interagency counter-IRGC petroleum seizure program requires 75 percent of the seized profits to be transferred to the fund, which according to an unnamed official, has insufficient assets for a round of payments next year to the nearly 16,000 Americans. 

The program is most effective when properly resourced and enforced, the lawmakers said, noting that “Since 2019, the program has seized over $200 million in Iranian oil. This program, which has also generated over $41 million for the US government's Treasury Forfeiture Fund, is depriving the IRGC of significant resources, which it uses to engage in terrorism targeting American citizens and our allies and partners around the world." 

The call for action to liquidate the confiscated oil came against the backdrop of Washington agreeing to release $6 billion in Iranian funds frozen in South Korea in exchange for five US citizens taken hostage by Tehran. The deal, which is rumored to have other secret aspects, may end up releasing at least $13 billion more in the future.

"It is really a battle, because the people benefiting from this situation and those harmed (by the new measures) will try in various ways to continue their illegal activities," Allaq told Reuters, referring to implementing US dollar supply restrictions on Iraq to prevent smuggling of banknotes to Iran.

Allaq did not mention Iran by name and said he did not have data on how much of Iraq's dollars has been smuggled to Iran or other neighboring countries, including Turkey and Syria, before the United States tightened regulations in November.

Muhammad Nuri Aziz, a member of the Iraqi parliament, said on a television show last week that Iraqi Prime Minister Mohammed Shia al-Sudani and the country’s central bank are aware of the schemes Iran uses to get hold of US dollars it desperately needs amid US sanctions. The lawmaker noted that the smuggling started during Mustafa Al-Kadhimi's term as prime minister and still continues. Without providing any context or details, the Iraqi lawmaker alleged that Iran prints Iraqi dinars in Argentina, exchanges the money to US dollars in Iraq, from where it is smuggled to Iran by trucks.

Reuters’ Timour Azhari said in a report, “Iraq's government is reliant on Washington's continued goodwill to ensure oil revenues and finances do not face US censure, but it came to power with the support of powerful, Tehran-backed groups and so cannot afford to alienate Iran. The latter groups have accused the US of meddling in Iraq's internal affairs and creating a currency crisis, as businesses either struggling or unwilling to abide by the new measures sourced dollars from exchange shops, driving down the value of the Iraqi dinar.”

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Iraq has more than $100 billion dollars in reserves, Allaq said, but could not freely intervene in the market to bring the rate down due to the restrictions.

Late in July, 14 Iraqi private banks sanctioned by Washington as part of a wider crackdown over helping to siphon US dollars to Iran said they were ready to challenge the measures and face audits and called on Iraqi authorities to provide assistance. The credibility of the Iraqi banking system has been tarnished due to the Islamic Republic's influence, and US financial restrictions have tightened on Baghdad because evidently all Iraqi banks have had interactions with the Islamic Republic.

The US barred the Iraqi banks from conducting dollar transactions as part of a wider crackdown on dollar smuggling to Iran. The latest sanctions, along with earlier ones, have left nearly a third of Iraq's 72 banks blacklisted, two Iraqi central bank officials said. The dinar has been falling against the dollar since the New York Federal Reserve imposed tighter controls on international dollar transactions by commercial Iraqi banks in November to halt the illegal siphoning of dollars to Iran.

Allaq said that action related to transfers from 2022, before a new platform that aimed to improve transparency went live. He said the central bank was undertaking a review of the banking sector and introducing new regulations that he said would likely see some banks close.

"It would be very normal in the coming period to see a reduction in the (number of private banks)," he said. "There are always side-effects, but at the same time we have a responsibility to protect the country's interests by trying to find the necessary means for monitoring and oversight so as not to expose the country to any issues on this front," he said.

'TRANSFORMATION'

The US measures have targeted Iraq's so-called dollar auction, where the central bank requests dollars from the US Federal Reserve before selling them to commercial banks, which in turn sell the funds to businesses in the highly import-dependent economy.

US and Iraqi officials have said the auction allowed large sums of money to be illegitimately acquired by groups who would provide fake invoices and then either transfer or physically smuggle the funds to neighboring countries, chiefly Iran.

A feature of a highly informal economy, the system was also used by thousands of small businesses that are not registered with the state, Allaq said, a widespread phenomenon in Iraq that allows them to dodge taxes and customs fees.

Since January the central bank has asked banks to provide detailed information on senders and recipients of transfers via an online platform.

When companies began trying to use the platform in January, less than 20% of requests were approved by US authorities, Allaq said. That number had now risen to around 85 percent, signaling growing ease with the new regulations, he said.

"It is not just an electronic platform, it will lead to a total reorganization of trade and the movement of money, and control on a lot of avenues for suspicious activity."

(With Reporting by Reuters)