A Riyadh-Tehran Entente?

IT WAS A BOLT out of the blue. On March 10, the national security advisers of Saudi Arabia and Iran agreed to restore diplomatic relations between the two nations. Even more significantly, the deal was brokered by China and announced in Beijing in the presence of China’s State Councillor Wang Yi. The immediate reaction of most observers and commentators was that this was bad news for the US. To abuse a geological expression, it was as if the Middle Eastern plate had suddenly shifted massively.

It is no secret that the US has no influence over Iran to get such a deal. In contrast, China—the new ‘Good Samaritan’ on the block—has good relations with both countries. It is equally true that the US with its newfound energy indepen­dence has little interest left in the region. China, it seems, has stepped into the vacuum created by the US departure. China’s star, it is claimed, is rising; that of the US is waning.

But beyond the handwringing and the surprise lie two un­mistakable structural changes in the world that have directly influenced this event. One is a material factor, and the other is an ideological one.

In 2021, the gap between the US and the Chinese econo­mies was the closest. At $17.88 trillion, China was just a small distance from catching up with the US economy which stood at $25.46 trillion. (Both are current measures of GDP, World Bank data). Since the end of World War II, no country has come close to catching up with the US. In 2022, matters changed a bit and the gap grew from $5.59 trillion in 2021 to $7.58 trillion as the Chi­nese economy slowed down due to that country’s zero Covid-19 policies. (2022 data are from the US Bureau of Economic Analysis and China’s National Bureau of Statistics).

One may think that just as a mas­sive economic catch-up allowed Beijing to gain political leverage, slower economic growth will subtract from its ability to strike such deals. This will be a mistake. Roughly speaking, the kind of contest for global primacy that the US and China are locked in requires a GDP of $10 trillion. Only at those levels and beyond can a country usefully blend its political, economic, and military means to produce the outcomes that it desires. China is well beyond that minimum heft. For another, China is now clearly in the grip of a ‘windows mentality’, where it thinks that its opportunities to shape the world order to its liking will only diminish henceforth. It is likely to double down on everything that it thinks is necessary to achieve its goals, including the ‘unification’ of Taiwan by military means. Analysts like Elbridge Colby have pointed this out repeatedly.

It may be a mere coincidence that the year in which China’s upward economic trajectory took a sharp turn—2006—was also the year when ‘democratic progress’—the steady increase in the number of countries classed as democracies as compared to ‘non-democracies’—reversed for the first time after the end of the Cold War. In 2006, Freedom House—the American think tank that ranks countries as democracies/non-democracies— reported “democratic decline” in 59 countries and “democratic progress” in only 56. Democracy rankings are hotly contested and highly politicised. The ideological twisting of the meaning of democracy, however, is reserved for countries like India where nationalist politics has gained ground in recent years. In countries that never knew democratic freedoms, the distinction between democracy and non-democracy is very clear.

If one ignores this definitional tug-of-war, the implication for geopolitics is clear. Sustained American hector­ing of ‘autocracies’ has landed these countries, one by one, in the Chinese camp. This is in marked contrast to the Cold War when the US was more than happy to deal with dictators and non-democracies alike. This aban­donment of realism and the adoption of woolly thinking based on the ‘end of history’ are costing the US dearly.

In a recent Foreign Policy opinion article, Stephen M Walt, a leading American scholar who is a realist, wrote that “It is easy to imagine autocrats around the world being more comfortable with China’s approach than with the United States’ penchant for heavily armed moralising.” He added that “If the United States allows China to establish a reputation for being a reliable peacemaker, as a great power that is willing to live and let live in its relations with others, convinc­ing others to line up with us will become increasingly difficult.”

Walt’s voice is a cry in the wilderness.

This period of transition is producing its own geopolitical logic. While the US and China slug it out, a wide spectrum of middling powers is hedging their bets. These powers—for ex­ample, India, Saudi Arabia, Türkiye, and the UAE—are look­ing out for their interests smartly instead of getting caught in ideological battles. Saudi Arabia has done its own hedging. While it signed on the deal with Iran backed by Beijing, it simultaneously agreed to buy 121 commercial aircraft from US airplane manufacturer Boeing in a $37 billion deal. Last year—much to American chagrin—Saudi Arabia also agreed to an OPEC plus Russian deal to cut back oil production.

The behaviour of these countries is a structural feature of great power competition. During the Cold War, too, a number of countries refused to join the warring camps and instead opted to take care of their national interests. India’s behaviour is similar in the two periods. Back then, it ‘leaned’ towards the Soviet Union; today, it ‘leans’ towards the US. Saudi Arabia, too, is behaving similarly.

It is tempting to equate the US and China and say that different countries are picking sides based on their political preferences, and thus, the two great powers ought to be seen neutrally. This will be a mistake. For all its problems, the US is not a territory-coveting, colonising, revisionist power. In China’s case, its toolbox is wholly coercive, even if it appears to be benign at the beginning. Its use of debt as a tool to bend countries to its will—Sri Lanka is an example—is calculated to that end. Beijing knows well that countries with autocratic (or kleptocratic) gov­ernments are bound to make irrational economic decisions. It counts on their inability to repay debt. This then leads to ‘geopo­litical bargains’, such as naval and military basing rights. If this sort of persuasion does not work (such as in the case of India and Taiwan), outright coercion is the weapon of choice. Whatever be its shortcomings, the US is a better bet for the world.

It is early days to evaluate the potential outcomes of the Saudi Arabia-Iran deal. One measure of the deal’s success will be the ending of the war in Yemen. But that may be easier said than done. What is happening in Yemen is not an interstate war between Saudi Arabia and Iran but a civil war in which the two countries have picked sides. It is far more difficult to withdraw from such conflicts than from direct, state-to-state, wars. Iran is another—difficult—power. It sees this deal as its way out of ‘pariah-hood’. But it won’t rest there. The driver of competition between Saudi Arabia and Iran—the quest for primacy in the Middle East—remains intact. From the Levant to the Persian Gulf, Iran is unlikely to easily give up its infrastructure of dominance.

ChinageopoliticsIranMusaad bin Mohammed al-AibanPersian GulfWang Yi