DM Monitoring
MOSCOW: Russian President Vladimir Putin says it is impossible to cut Russia off from the rest of the world, and that sanctions imposed by Western countries will not turn the clock back on Russia’s development.
Since sending troops into Ukraine on February 24, Russia has been hit with a barrage of Western sanctions designed to isolate it from the global economy that have deprived it of access to goods including commercial electronics, semiconductors and aircraft parts.
“Not just restrictions but the almost-complete closure of access to foreign hi-tech products is being deliberately, intentionally used against our country,” Putin said on Monday, speaking at a video conference with government figures.
“This is a huge challenge for our country, but we are not going to give up and stay in a state of disarray or, as some of our ‘well-wishers’ predict, go back decades. Of course not,” he said.
Putin said Russia would have to develop its own domestic technology and technology firms.
Finance minister Anton Siluanov said support for the Russian technology sector is a priority, but that every rouble of state support should be accompanied by at least three roubles of private investment.
The EU’s foreign ministers said on Monday that the sanctions imposed on Moscow are working, even though they also threatened the EU’s energy supplies.
Last week, Hungary’s nationalist premier Viktor Orban the EU leader closest to the Kremlin and a critic of Brussels denounced the policy, saying Brussels was hurting Europe more than Moscow.
“Some European leaders have been saying that the sanctions werea mistake,” EU policy chief Joseph Borrell told reporters as he arrived at the bloc’s headquarters on Monday for talks on closing loopholes in the sanctions regime and increasing pressure on Russia. “It is what we had to do, and we will continue doing,” he added.
In his second trip abroad since the outbreak of the war in Ukraine, Russian President Vladimir Putin is set to visit Iranian President Ebrahim Raisi in Tehran on July 19.
Putin’s trip to Tehran follows US President Joe Biden’s tour of the Middle East last week, where Iran and its nuclear program were among the main topics of discussion.
Putin will be joined in Tehran by Turkish President Recep Tayyip Erdogan and the meeting will address the situation in Syria, where Iran, Russia, and Turkey all have a strong military presence.
But the meeting will also provide a chance for Moscow and Tehran, both under severe Western sanctions, to showcase their military and economic cooperation, demonstrating to the West that they are not isolated.
Iran and the Kremlin have increasingly found common ground of late, with officials from both countries repeatedly stating their willingness to expand commercial and political cooperation.
Putin’s visit comes about a week after the White House said Tehran is preparing to sell armed drones to Russia for use in Ukraine. Iran has said technological cooperation with Russia preceded the war, without confirming or denying the US claim.
Amid growing diplomatic isolation, increased trade with Russia could create relief for Iran’s economy, which has been floundering under US oil and banking sanctions for years. Russia, on the other hand, sees Iran as a potential arms provider, offering a trade route and expertise in dodging sanctions and exporting oil.
The military partnership between Tehran and Moscow has been growing since the outbreak of the decade-old conflict in Syria.
“But it mostly has remained a tactical cooperation over the matters of mutual interest in the region,” as Abdolrasool Divsallar, a visiting professor of Middle Eastern studies at Università Cattolica del Sacro Cuore in Milan, Italy, told German media.
Iranian leaders, especially the conservative hardliners currently ruling the country, had always sought to develop their country’s ties with Russians but the war in Ukraine has now made Iran a more central element in Putin’s diplomacy.
Over the past few months, trade between the two countries has expanded, according to several reports by Iranian media.
During a meeting with Iranian President Raisi on the sidelines of a regional summit in Turkmenistan last month, Putin noted that trade between the two countries was up 81% last year.
Despite that, relations between the two countries are complicated by energy concerns as Russia increasingly cuts into Iran’s market share in its push to find new buyers for its own oil.
“Russia and Iran are in fact trade competitors, especially in the energy market,” Hamidreza Azizi, a researcher at the German Institute for International and Security Affairs (SWP) told media.
Currently, Iran seems to be losing its already narrow share in the energy market to Russian oil, which now comes at a more discounted price.
In the last three months, for example, Iran’s monthly exports of oil by-products dropped from 430,000 tons to 330,000, Hamid Hosseini, general secretary of the Iranian Oil, Gas and Petrochemical Exporters’ Union (OPEX), told the Iranian media in late June.
Iran’s largest steel buyers, including China and South Korea, have also shifted to buying discounted Russian steel, an Iranian newspaper reported on May 21.
With sanctions severely curtailing Iran’s revenues, oil exports are vital for the country, which is now facing economic crisis. The inflation rate is above 50% but Iran has reportedly been forced to slash its oil prices to keep up with Russian discounts.
Back in March, Russia nearly sabotaged negotiations over the Joint Comprehensive Plan of Action (JCPOA) or Iran nuclear deal, the resolution of which could lead to the relaxation of some sanctions on Iran’s economy.
Talks in Vienna appeared to be moving toward agreement until Russian negotiators demanded their trade with Iran be exempted from recent Western sanctions on Russia over its invasion of Ukraine.
“Iran and Russia are not allies yet,” says Abdolrasool Divsallar. “Iran has been reluctant to condemn Ukraine’s invasion but they have repeatedly opposed the war, which is very different from what allies are expected to do,” he argued.
Tehran’s stance is based on opposition to war everywhere in the world, Iranian Foreign Minister Hossein Amir-Abdollahian told his Ukrainian counterpart Dmytro Kuleba on Friday, according to Iranian media.
Rather than supporting Russia’s pursuit in Ukraine, Iran has other motives for getting close to Moscow, Divsallar said. With the nuclear talks now at a standstill, “Iran might just want to show the West that it has an alternative, that it can have an influence that goes beyond the Middle East.”
SWP’s Hamidreza Azizi, on the other hand, said Iran’s rapprochement with Russia stems from a mutual worldview and has continued to deepen over the past decades.
“Both countries position themselves against the US domination of international relations and both share an ambition to counter it,” Azizi said. “In addition, the tensions between Iran and Western powers have risen continuously, ever since the Islamic Republic was founded in 1979.”
Such chronic tensions are unlikely to go away soon, Azizi noted, and will most likely mean that Iran will keep looking to the East.
Unlike Azizi, Divsallar is of the opinion that a revived nuclear deal and its subsequent sanctions relief could limit Iran’s relationship with Russia by giving the country the option to build trade relations with the West instead.
“A major part of Iran’s motive to work with Russia is driven by its urgent economic needs and lack of alternatives,” Divsallar said. “Iran cannot dismiss its relations with Eastern powers like Russia, as long as there are no options in the West.”
