China Iran Relations: Past, Present & Future

Although unofficial diplomatic interaction between the People’s Republic of China and Iran started in 1949, formal diplomatic relations between the two countries started in 1971 after the historic USA-China thaw. Notwithstanding the ideological differences between the leaders of the two countries-the Shah was friendly towards the United States and Mao was a communist, the relationship thrived. The main reason for this diplomatic engagement was the mutual need of both the countries to counter the increasing Russian influence in the Persian Gulf in the wake of a recently-signed Soviet-Indian friendship Treaty.

Once the Shah was overthrown during the Islamic Revolution, China quickly recognized the new government on 14 February 1979. In the 1980s, the shared ideological themes of anti-imperialism and Third World solidarity helped solidify the relationship but they became allies as a way to counterbalance the Soviet Union and the United States during the Cold War.

During the Iran–Iraq War (1980-88), China was allied with both the countries; relations were determined mostly by Tehran’s critical need for ammunition and Beijing’s need for cash. Though China adopted the policy of neutrality regarding the war, it exported a huge amount of armaments to both countries. In 1987, 70 percent of Iranian arms were imported from China even though Beijing was under pressure from the United States to stop arms exports to Iran.

Both countries closely cooperated against the USSR during the 2nd Afghanistan War (1979-88) by providing arms and imparting training to the Mujahadeen. Incidentally, they again cooperated closely against the USA in the 3rd Afghanistan War (2001-2019) to ensure that the USA  remained bogged down in its second Vietnam

During the recent past, they came extremely close because of the Syrian conflict. While the USA and its allies were backing the anti-Assad forces, China, Russia, and Iran got united to thwart the American ambitions in the Middle East. In April 2015, China stated that Iran had been officially accepted as a founding member of its newly founded Asian Infrastructure Investment Bank, with the latter owning 15,808 shares. There has also been discussion as of late for Iran to eventually join the Shanghai Cooperation Organisation, of which it is currently an observer state, as a full member.

In July 2019, UN ambassadors from 50 countries, including Iran, have signed a joint letter to the UNHRC defending China’s treatment of Uyghurs and other Muslim minority groups in the Xinjiang region.

Why China Needs Iran?

Sino-Iranian relations have often been described with the cliché of “2,000 years of friendship, cooperation, and trade” by statesmen of both countries. And there are hardcore national interests of both the countries which have cemented their ties over some time. For China, Iran has special significance for the following reasons

Containment Fears: Chinese know that despite strong Sino-US economic and trade interdependencies, the USA is ideologically committed to confronting and containing China, economically, politically and militarily to maintain its global dominance through its policy of containment. Remembering how containment successfully dismantled USSR, the Chinese want to ensure that all their flanks including Iran are covered in the ensuing Cold War.

Resources Security: China may be self-sufficient in the resources needed for economic growth, but keeping in view its long-term growth requirements, it is dependent on imports of these resources. Iran is an excellent source as well as a route for the imports of highly desired minerals, coal, zinc, lead, and copper. Specifically, Iran is a reliable supplier of China’s increasing need for crude oil and would offer better prices and even barter oil away while under U.S. sanctions.

Bargaining Chip: Beijing sees “the Iran card” as invaluable leverage in its negotiations with the United States over various issues and based on this factor has adjusted its proximity or distance from Tehran. Beijing suspended its sales of sensitive military technologies to Iran when it realized that it might jeopardize its ties with the United States.

Strategic Location: China knows that ultimately the fight for the global hegemony will be decided in the Indian Ocean; Iran’s strategic importance due to its controlling the vital Strait of Hormuz has made Iran the most coveted country in the region. Iran occupies a special place in the geostrategic calculations of the Chinese leadership for its location in the Middle East which, in turn, has special significance for China. Besides its proximity to Central Asia, the soft belly of its rival Russia, it is bordering the Indian Ocean from where 60% of ships carrying goods to and from different countries pass, makes it even more significant. Similarly, it is the outer border of the Middle East where the USA and its allies are fighting for resources, markets, and hegemony. Besides, China is also interested that India should be restricted in getting a firm foothold in the region which is too close to Gawadar

Chinese Muslims: While a direct land attack on mainland China is next to impossible, they are worried about the dissident feelings among its Muslim populations. They know that the USA had been training Uyghur Muslims in various war theatres for their possible use inside China. Iran can play an extremely key role in foiling these plots to control the Chinese Muslim population which could be radicalised by the Islamic ideology of Iran. A case in point is Beijing’s consonance with Iran and Russia about the developments in Syria, where up to 5,000 Uyghur fighters are involved in the war. The return of those fighters could pose a grave security risk for China.

Belt & Road Initiative: Keeping in view its long-term growth requirements, China desperately needs regional and global connectivity by land and by sea for ensuring free movements of goods and services. China’s Belt and Road Initiative (BRI) is essentially to meet its future trade needs rather than a strategy for global domination as alleged by the Western media. As of 2019, Iran has signed onto Xi Jinping’s signature One Belt One Road plan. Iranians and Chinese are currently renovating rails to connect Urumqi to Tehran as well as connect Kazakhstan, Kyrgyzstan, Uzbekistan, and Turkmenistan  In another 2016 test run, it took 12 days to deliver freight from Shanghai to Tehran, whereas it would have taken 30 days by sea. In May 2018, China planned to build a new freight train line with Iran.

Why does Iran need China?

Similarly, China has special significance for Iran to achieve its national interest objectives such as

Counter America: Battered by U.S.-led international sanctions in the wake of its nuclear program and support for its proxies like Hezbollah in the volatile Middle East region, Iran adopted the “Look East” policy under Mahmoud Ahmadinejad who preceded current President Hasan Rouhani. China warmly responded to Iran’s gesture and signed a treaty in 2008 that allowed the Iranian government to use its revenue of the oil sale as credit for the purchase of Chinese goods, for energy infrastructure development as well as purchase of sensitive technology. China is seen more as an option for times of crisis; Beijing can provide a breathing lifeline for Iran, especially when it is heavily under the pressure of the sanctions.

Trade-Trade between the two countries reached $1.627 billion in the 1980s, $15 billion in 2007, and US$ 33 Billion in 2018, making China the biggest trading partner of Iran. Iran supplies China with the highly desired minerals coal, zinc, lead, and copper. Trade between the two states also included power generation, mining, and transportation equipment along with arms and consumer goods such as electronics, auto parts, and toys. Because of its limited refining capacity, Iran imports one-third of its refined products such as petrol from China. A ten year agreement between the two countries signed in 2016 would increase the total value of trade between the two countries to $600 billion, giving Iran the badly needed economic relief.

Investment- Because of its heavy reliance on Iranian oil and gas, (80% of Chinese imports from Iran are hydrocarbon resources), China is now investing in the modernization of Iran’s oil and gas sector to secure access to the resource. Not only is China helping to develop the oil and gas sector, but China supports Iran’s ambitions to bring Caspian Sea oil and gas to Southern Iranian ports through pipelines so the resources can be exported to Europe and Asia. Additionally, China has invested in Tehran’s subway systems, dams, fishery, and cement factories. Not only is China helping

Military equipment-China is believed to have helped Iran militarily in the following areas: conducting training of high-level officials on advanced systems, providing technical support, supplying specialty steel for missile construction, providing control technology for missile development, and building a missile factory and test range. It is rumored that China is responsible for aiding in the development of advanced conventional weapons including surface-to-air missiles, combat aircraft, radar systems, and fast-attack missile vessels.

Nuclear technology-Nuclear cooperation between the two countries began in the 1980s when China helped build a research reactor and supply four other research reactors. It was followed by helping Iran construct a uranium hexafluoride enrichment plant near Isfahan and resume construction on a nuclear power plant at Bushehr that was left uncompleted by the French and Germans. In 1991, International Atomic Energy Association discovered a covert nuclear agreement signed in 1990 between the two countries. This discovery was followed by an unprecedented nuclear cooperation agreement in 1992. The agreement was signed despite U.S. protests to have China limit its nuclear cooperation with Iran. In 2016, Rouhani and China’s Xi signed nearly a dozen and half agreements to boost bilateral economic and commercial ties. Under these agreements, China would build two nuclear power plants in southern Iran and in turn Iran would provide long-term oil supplies to China.

For Defence against attack-Chinese oil companies have exclusive rights to three large regions of Iranian land as well as the right to build all necessary infrastructure for these regions.  In return, China promises to treat any foreign attack against these regions as attacks against its sovereign territory and will defend them as such. This agreement is the concrete basis for Major General Zhang Zhaozhong’s statement that “China will not hesitate to protect Iran even with a third World War.”

Help at world forums– Iran relies on China’s membership and especially Chinese veto power on the Security Council to protect it from US-led sanctions and attacks. China is known for its preference for diplomacy over sanctions.


Bilateral relations between Iran and China are by and large are business-oriented, and non-ideological based on a pragmatic assessment of their respective national interests. Iran under heavy sanctions of the USA and its allies has no option but to rely on China, rapidly rising as a global power that can challenge US economic dominance. On the other hand, China is fully conscious of the geostrategic importance of Iran, a major regional power located at the crossroads of the Middle East and Central Asia. This is an area that is important to its Belt and Road Initiative (BRI). And, besides a great deal of untapped potential for foreign investment, Iran has oil and gas resources which could be easily transported over land to China. The proposed US$ 400 billion 25 years economic and security deal between the two countries is crystallization of these hard realities

From Global Issues: A Handbook by Shahid Hussain Raja, published by Amazon

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