China and the Iran-Saudi Rivalry: Towards a Greater Role?

Kishorchand Nongmaithem, Research Assistant, ICS

In January last year, when the Chinese President Xi Jinping visited Iran, the two countries agreed to expand their commercial ties to US$600 billion in the next ten years.[1] On that visit, Iran’s Supreme Leader Ayatollah Ali Khamenei told Xi that, “Iran never trusted the West” that’s why Iran “seeks cooperation with more independent countries” (like China).[2] China also welcomed Iran to work together under its ‘Belt and Road’ connectivity framework.[3]

A year later in March 2017, King Salman bin Abdulaziz of Saudi Arabia visited China, and during his three-day stay, the two countries signed deals worth US$56 billion that included 14 cooperative agreements and 21 other deals on oil production, investment, energy, space and other areas.[4] The visiting king also urged China to take a more active role in West Asian politics. In response, China’s Foreign Minister Wang Yi said that ‘as an old friend of the Middle East, China is ready to play the role of a driver of peace in the region.’[5] Earlier, he had also expressed his willingness to act as a mediator between Riyadh and Tehran—the two arch rivals in the West Asia.[6]

It is obvious that China is engaged in economic diplomacy in a bid to enhance its presence in a region which has traditionally been a playground of the US, Europe and Russia. More than half of its crude oil imports comes from West Asia—the Persian Gulf, in particular—and Saudi Arabia and Iran are the key crude oil supplier to China. Hence, both countries are too important for China to be left out to others. However, given the complexities China now faces, its observers of the region are probably asking if China, using its business deals will be able to mediate the long-standing rivalry between Saudi Arabia and Iran

It is important to note that, the Saudi-Iran rivalry is mostly political and sectarian in nature. The two countries are also fighting proxy-wars against each other in various theatres of conflict throughout the region. For example, in Yemen, Saudi Arabia is fighting against the Houthis, an Iran-backed Shiite group. And in Syria, Iran is backing the Bashar al-Assad regime whereas the Saudis are supporting the rebels fighting to overthrow Assad.

The tension between the two has become more evident in recent years. The 2015 Hajj stampede incident in Mina, near Saudi Arabia’s Mecca which left 464 Iranians dead has amplified the strained relations between Saudi Arabia and Iran.[7] Then in January 2016, the execution of prominent Shia cleric Sheikh Nimr al-Nimr, along with 47 others by Saudi Arabia ignited widespread protests in Iran leading to attacks on the Saudi embassy in Tehran.[8] The situation was further escalated by Riyadh’s decision to cut-off diplomatic ties with Iran. Iran’s President Hassan Rouhani termed it an action to ‘cover up the big crime’.[9] In this context, China’s hoping for playing a mediator’s role would be challenging in a region where the dynamics of problems are extremely complex.

It is also well known that Saudi Arabia is probably one of the greatest partners of US in West Asia, while Iran is the ‘number one enemy’. Hence, the US will not appreciate China’s new role in the region. Despite the gradual decline of the US influence in region, its position is still strong, and it would be difficult for China to challenge it for quite some time.

On the other hand, many observes of the region have an impression that China is more inclined towards Iran. In fact, China’s relations with Iran have already reached a strategic dimensions, while its relations with Saudi Arabia are still transactional in nature restricted to trade in oil and Chinese manufactured goods. According to one analyst, Iran’s position would be more advantageous than Saudi Arabia in the future geopolitical landscape given it is pivotal to the success of China’s Belt and Road Initiative compared to Saudi Arabia.[10]

Meanwhile, sanctions imposed by the US, have also constrained Iran which is in desperate need of a major economic partner. Iran also needs China’s support at the UN and on the global stage. In this regard, China seems to have the potential and willingness to support Iran. Therefore, unlike the US, China is not likely to take tougher policy decisions against Iran, which the Saudis seem to be hoping for.

Finally, West Asia is a region where many other powers have failed in the past. It is possibly in this context that President Xi prefers to spend time more in signing business deals to enhance economic cooperation, rather than directly interfering in the political quagmire of West Asia.

Nevertheless, as China becomes more exposed to West Asia under its Belt and Road initiative, many risks are obvious and to be expected. If Beijing wants to play in the stromy waters of West Asia, then it will need to be extremely cautious in maintaining its balancing act, and not jeopardising its relations with either Saudi Arabia or Iran.












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