Iran-P5+1 Nuclear Deal: Impact

Iran-P5+1 Nuclear Deal: ImpactQuestion: Iran and P5+1 have recently signed a nuclear agreement referred as the Joint Comprehensive Plan. Discuss the impact of this deal.

- Iran nuclear deal has had a positive impact in many key areas such as non proliferation, regional balance and a boost for India-Iran relations.

- P5+1 nations include the US, the UK, France, China, Russia and Germany along with the EU

- Deal offers movement in a new direction and different countries from Russia to Germany have given positive feedback following closure of this deal

- This deal is a catalyst for regional stability and critical for the removal of sanctions on Iran

- There are nuclear dimensions of this deal as well wherein Iran has to step back from the nuclear threshold if it wants to overcome the hurdle of sanctions

- Sanctions relief will pave the way for the economic growth and development of Iran

- India can compete with Western and Turkish enterprises for opportunities in the corporate sector with Iran

- Under the Joint Comprehensive Plan, number of centrifuges will be reduced by 75% and enrichment will be limited to a single facility at Natanz

- Fordrow enrichment facility will be changed into a nuclear, physics technology research centre where no fissile material can be used

- As per the terms of the deal, from its current stockpile of 10 MT of partially enriched uranium, Iran will retain 300 kg of uranium enriched to level of 3.6 percent while the rest will be shipped out

- Arak heavy water reactor will be redesigned

- Iran will also not undertaken any reprocessing activity

- Monitoring of uranium mining and milling will persist for over 2 decades while restriction on designing and production of new centrifuges will remain in force for 20 years

- IAEA provisions will remain in force for another 5 years and milling will continue for 25 years Verification covers supply chain of nuclear related components

- Defence sites such as Parchin have been kept out of the facilities for nuclear energy while a 24 day time frame is provided for adjudication by joint commission to be established under the Joint Comprehensive Plan of Action/JCPOA

- Nuclear related imports are permitted and will be channelised through stipulated procurement channel

- All nuclear sanctions will be removed permitting close to USD 100 billion of blocked funds to be released and resumption of international engagement for Iranian banks and financial institutions

- JCPOA will also modernise the oil and gas industry infrastructure and permit Iran to increase its oil and gas export revenues subject to international demand

- US needs new leverage in the West Asian region and hostile relations with Iran were counterproductive to this; the impact of the deal on Iran-US relations will be massively positive

- The transformative potential of the deal for Iran’s domestic policies in creating greater democracy and economic integration with the West cannot be overlooked

For India

- This deal is also going to have a positive impact on India, as prior to sanctions, Iran constituted 16.4% of Indian oil imports which then fell to 6 percent

- Oil prices are down and Iran’s entry into the market enables diversity in sources and building up of a strategic reserve

- This deal will also contribute to a larger regional presence for India

Facts and Stats

- Iran has a young and literate population apart from GDP per capita income level of USD 15,000 in PPP terms according to World Bank(2013) data.

- Sanctions relief also gives legitimacy to the Iranian nation