Iran The Iran Nuclear Challenge: Asian Interests and U.S. Policy Options George Perkovich main argument c Matthew Winterburn The U.S. alone cannot stop Tehran from continuing to expand Iran’s capacity to enrich uranium and, ultimately irAn by the nUmberS perhaps, to produce nuclear weapons. The cooperation of Iran’s rich oil resources have become the country’s the major Asian powers is necessary to cause Iranian leaders foreign policy trump card… to reconsider the costs and benefits of continuing not to Iran's petroleum 2000 2007 comply with IAEA and UN Security Council demands. Total oil production (th 3,765.4 4,033.3 bbl/day) policy implications Consumption (th bbl/day) 1,248.0 1,739.0* All major Asian states would oppose U.S. policies of coercive Net exports (th bbl/day) 2,517.0 2,294.0* regime change or military strikes against Iran. This leaves * Values are forecast three basic alternative policies: • Accepting uranium enrichment in Iran, under negotiated …building extensive energy ties to Asia’s oil-thirsty economies… limits, conditioned on Iranian steps to reassure Israel and other regional states. This option may appeal most Imports from Iran % total 2006 (th bbl/day) consumption to Asian states, given that it would reduce prospects of Japan 448 8.6 further sanctions. China 335 4.4 • Acknowledging Iran’s refusal to comply with UN India 302* 11.7 Security Council demands, withdrawing the positive * April through August 2006 inducements that have been offered for Iran to cease enrichment, building support among partners for long- …and fostering greater bilateral trade with states term sanctions, and “fortifying” a red line that holds Iran to its commitment not to build nuclear weapons. Iran's trade balance with 2000 2007 China ($m) 1,046.5 4,100.8 • Inviting Iran to engage the U.S. on non-nuclear issues in India ($m) 174.6 -1,243.0 hopes of building the political will later to comply with a temporary nuclear suspension. Indonesia ($m) -71.3 -348.1 Japan ($m) 4,185.8 10,133.1 • To shape the environment for any of these policies, the Russia ($m) -871.2 -2,707.8 U.S. could work with Asian powers and Iran’s neighbors either to create a forum for regional cooperation if Iran Iran’s defense expenditure has also grown, nearly moves to comply with IAEA and UN resolutions or to quadrupling since 2000 coordinate containment if Iran is belligerent. Iran's defense expenditure 2000 2007 Local currency (bn rials) 21,984 79,871 Constant dollars (2005, $m) 4,731 6,592 % GDP 3.8 4.6* * Value is for 2006 George Perkovich is Vice President for Studies–Global Security and Economic note: Data compiled by Strategic Asia research staff. Development and Director of the Nonproliferation Program at the Carnegie Endowment See data section for full source details. for International Peace.
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