Iranian leader scores a victory at home

Dubai, United Arab Emirates • Iranian President Hassan Rouhani's deal with world powers may strengthen his hand against hardliners opposed to his policy of detente, and bolster his popularity at home where sanctions have drained the economy.

"Rouhani has won a major domestic victory," Ghanem Nuseibeh, the London-based founder of Cornerstone Global Associates, which advises clients on risk in the Middle East, said by telephone. "He said he would help the economy and work on easing the sanctions, and less than six months later, he has a deal."

Early on the fifth day of talks in Geneva with negotiators for a group of world powers, Iran agreed to curtail its nuclear activities in return for an easing of some of the economic restrictions imposed on his nation, and the two sides aim to conclude a comprehensive accord within six months. Western countries have accused Iran of harboring nuclear-weapons ambitions, a charge it denies.

The interim agreement is likely to vindicate Rouhani's policy of engagement with the world and pacify some of his political rivals at home, who had challenged the overhaul of ties with the U.S. in particular as going too far. Rouhani broke with the past in September when he had a 15-minute conversation with President Barack Obama, the highest-level U.S.-Iranian exchange since the Islamic revolution that toppled Iran's monarchy in 1979.

"The hardliners will still criticize him for sure," Salman Shaikh, director of the Brookings Institution's Doha Center in Qatar, said by telephone. Still, Rouhani's "on fairly safe grounds. Supreme Leader Ayatollah Ali Khamenei will continue to support him in his current approach."

The accord marks "a starting point for a new chapter for the Iranian nation," Rouhani said in an address Sunday. "The world came to realize that respecting the Iranian nation will bring about positive results and that threats won't bear fruit." The president said that Iran "has never and will never seek weapons."

Since winning election in June with his message of moderation, Rouhani's challenge has been to strike a balance between delivering on his campaign pledges - which included the release of political prisoners and enhancing freedoms for the average Iranian - and avoiding the appearance of a leader compromising on Iran's national security. That would have offered ammunition to politicians opposed to rapprochement with the U.S.

Tensions had peaked under his predecessor, Mahmoud Ahmadinejad, who taunted the West with his aggressive rhetoric and frequent references to the disappearance of the state of Israel. That brought global condemnation and vows from Israeli leaders that they would revert to military strikes to prevent Iran from developing nuclear weapons.

Iranian Foreign Minister Mohammad Javad Zarif said Sunday that the new agreement should silence threats of war that have loomed over his country.

Under the interim deal, Iran must improve cooperation with United Nations monitors, commit to eliminate its stockpile of uranium enriched to 20 percent levels and halt advanced centrifuge installation, the White House said in a statement. Iran also won't commission its Arak heavy water reactor, which, if it became operational, could produce plutonium and give the country a second path to nuclear weapons. The country would be rewarded with as much as $7 billion in sanctions relief.

Iranians, fed up with economic hardship, will reward Rouhani for his initiative.

"The credit is all Rouhani's and, of course, Zarif's," Nafiseh, 35, a teller working in a private Iranian bank in central Tehran, said as a deal in Geneva appeared imminent. "He was very tired last night when TV showed him, but he was smiling with energy and he didn't give up Iran's rights."

Iranians will take "pride in the fact that the country can negotiate with world powers in such a professional way and that will increase his popularity," Ali Dadpay, assistant professor of economics at Clayton State University in Georgia, said in a phone interview. Iran's business community is likely "to now believe more in him and the fact that he has his priorities right."

Sanctions pushed oil output to the lowest since 1990 and squeezed the economy, which contracted more than 5 percent in the fiscal year that ended in March. Iran's currency, the rial, lost more than half its value in the year before Rouhani's election, due in part to sanctions denying Iran access to the world financial system. Iran's inflation was 40 percent last month.

"If sanctions are removed, our economic situation will be good again," said Alireza, 28, who studies architecture in Tehran. "If Iran is able to use all its resources, it will become an important, powerful country."

It will take some time for the benefits of the agreement to be felt on the street, Dadpay said.

Rouhani has showed Iranians "that he can deliver," he said. "However for people to be really thankful, he or she needs to see a change in prices and more jobs."

— With assistance from Yeganeh Salehi in Tehran.

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