Rouhani and Iranian Revolutionary Guards: political tension of an economic nature

Following Hassan Rouhani’s victory in Iran’s latest election and the beginning of the second term of his presidency, observers of Iranian affairs are attempting to determine the changes in Rouhani’s policies concerning the numerous complex issues he must deal with, compared to his first term.

The relationship between Rouhani and the regime’s Islamic Revolutionary Guards Corps (IRGC) is one of the most urgent questions among these pressing issues, with this tense relationship now entering a very critical stage.  Whilst Rouhani and the IRGC reportedly have differences over the 2015 Joint Comprehensive Plan of Action (JCPOA) and Iran’s missile programs, the main area of tension between the president and the Revolutionary Guard concerns the IRGC’s dominance of Iran’s political and economic spheres.

[alert type=blue ]Author: Dr. Mohammed Al-Sulami is a political analyst and head of the Arabian Gulf Center for Iranian Studies (AGCIS). [/alert]

This dispute, which grew during Rouhani’s first presidential term, has now escalated following Rouhani’s recent strong condemnation of the IRGC’s role in the country’s economy, with the reelected president accusing the IRGC of plundering the country’s wealth through its control over economic institutions in the name of privatization, saying: “A part of the economy was controlled by an unarmed government and we delegated it to an armed government [a reference to the IRGC]. This is not [a sound] economy or privatization.”




Although Rouhani does not mention that this policy has been pursued by the IRGC for the past decade under the direct supervision of the Supreme Leader, Ayatollah Khamenei, his implicit condemnation of the leader through condemning the Revolutionary Guards is clear.

Despite his lofty words, however, the supposed moderate reformist Hassan Fereydon – Rouhani’s birthname – has a long history of service in and dealings with the IRGC, as a former commander of the Revolutionary Guards’ Khatam Al-Anbiya headquarters, as well as heading the Guards’ Air Defence division and serving in other high-ranking military positions.

Once he took office as president, however, tensions began to develop between Rouhani and the IRGC, both in the context of the JCPOA treaty and concerning the regime’s missile program. Rouhani does not oppose the missile program per se, but has been unhappy at the media frenzy and the timing of the IRGC’s missile-testing, complaining that carrying out the missile tests while the government is conducting sensitive diplomatic negotiations resulted in the failure of his efforts to create diplomatic openings with the West, even with the tireless efforts of Foreign Minister Mohammad Javad Zarif, Rouhani’s favorite and a popular public face for the regime overseas.

Although the IRGC doesn’t oppose the JCPOA itself, which could not have been signed without the agreement of Ali Khamenei and his henchmen – i.e. the IRGC’s commanders – it differs with Rouhani in flatly rejecting the economic terms and consequences of the deal; while Rouhani wants to open the door to western investment in Iran’s oil industry, this is simply unacceptable to the IRGC which effectively controls Iran’s oil and gas industries.




During the first term of Rouhani’s presidency, a proposal by oil minister Bizhan Zanganeh to outsource new oil contracts and promote foreign investment in the country’s oil and gas industry was strongly opposed by Khamenei, with Rouhani coming under political attacks by all sides for the suggestion and being accused by Khamenei of failing to provide a desirable economic performance. The Supreme Leader went so far as to accuse Rouhani of deliberate  negligence  regarding Iran’s economy, suggesting that Rouhani was pursuing this policy in order to serve the West against Iran’s interests so that he could attain political gains for himself by bringing the JCPOA to fruition.

Prominent hardliners close to the leader introduced several tactical strategies in an effort to coerce Rouhani, bringing Ahmadinejad back to stand in the presidential election campaign, with Rouhani and his administration being attacked by the Supreme Leader. The intervention of some prominent political and clerical figures, led by Rafsanjani and Nategh Nouri brought these tensions under control, with the crisis being resolved with an agreement to end Ahmadinejad’s candidacy so long as Rouhani gave control of the ministries of sports, culture, and education to hardliners, and rewarded the IRGC with massive oil contracts with foreign companies. For Rouhani, the reason for accepting the introduction of this new model of oil contract was to avoid being defeated completely with a return to the old system in which contracts were wholly monopolized by the IRGC.

Another motive for Rouhani in accepting this new model of oil contract was simply to ensure his victory in the second term of presidency was unimpeded. After this was achieved, Rouhani immediately began his second term by signing a massive oil contract with French oil giant Total. This contract renewed the hostilities between Rouhani and the IRGC, with the tension reaching its peak following Rouhani’s aforementioned recent comment about the IRGC as an “armed government” obtaining control of part of Iran’s economy in the name of privatization. It should be noted that Khamenei had supported the process of privatization during Ahmadinejad’s presidency.

By escalating the dispute with the IRGC and Khamenei, Rouhani is attempting to force their hand into agreeing to accede to his demands to some degree, since they are fully aware that even implicit reference to the IRGC’s control of this sector could culminate in further international sanctions against Iran.  It should be stressed that Rouhani has no wish for sanctions, but is simply pursuing government control over the lucrative oil contracts with foreign companies, rather than seeing the contracts and profits go wholly to the IRGC.




Rouhani recently met with senior IRGC commanders, including the head of the Quds Force Qassem Suleimani, in an effort to reduce tensions and find an agreeable compromise on the issue, which might create this opportunity for Rouhani and his government to have access to a part of the country’s oil revenue to fund the government’s economic programs.

Although the tensions between Rouhani and the IRGC do have political aspects, they are primarily due to the IRGC’s dominance over Iran’s economy. It should be emphasized, however, that these disputes with not create any fundamental changes in the power balance in Iran or in its policies, with Rouhani wholly supportive of the IRGC’s military presence in Syria and Iraq, and the Revolutionary Guards’ terrorist activities in Iran and overseas.

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