Iran and China have inked a strategic partnership that will last 25 years and will encompass high-level economic and military cooperation. The deal was signed last year but details of the deal were kept secret until recently. Those details are beginning to emerge now, at Iran’s behest.
China will invest $280 billion in developing Iran’s oil and gas sectors under the parameters of the deal. An additional $120 billion will be invested in upgrading Iran’s transport and manufacturing infrastructure.
In exchange, Chinese will companies have the option to bid first on any new or uncompleted oil and gas projects in Iran.
China will also be able to buy any and all oil and gas products from Iran at significant discounts (up to an estimated 32%) off of the benchmark prices for those products.
China will also take on a significant role in building out Iran’s infrastructure as part of China’s worldwide “One Belt, One Road” project.
Perhaps the most significant aspects of the deal is that it will involve “complete aerial and naval military co-operation between Iran and China, with Russia also taking a key role.”
The military cooperation will include the rollout of Chinese and Russian electronic warfare capabilities and the deployment of Russian air defense systems, “to counter U.S. and/or Israeli attacks.”
The main impetus of the deal between the three powers is to coerce the U.S. to re-enter the Iran nuclear deal. President Trump withdrew the United States from that deal last year in a quest for a stronger one. Both China and Russia remain supportive of the existing deal framework.
Photo by The Kremlin