UPDATE OF IRAN HANDBOOK

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79-00891A001100100001-0
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 27
• Document Creation Date: December 20, 2016
• Document Release Date: May 29, 2001
• Sequence Number: 1
• Publication Date: April 1, 1972
• Content Type: BH

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Update of Iran Handbook
86
TI/L'eS RO COOdc
C t2-
No. 0540
0540
April 1972
Please replace the January 1970 edition of the Iran Handbook with the
attached. Please retain the cover and dividers.
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the Shah is worried about Soviet equipment which the Arab states, especially
Iraq, are receiving. He has concentrated since the mid-1960s on improving
the navy and the air force and on building up defenses in southern Iran and
along the Persian Gulf. He continues to purchase most of his sophisticated
equipment from the United States but has also bought equipment from the
United Kingdom, the USSR, France, and West Germany. Iranian armed
forces are capable of defending Iran against almost any conceivable internal
disruption and against attack by any Muslim neighbor.
Iran
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I. GEOGRAPHY
Location and area
Iran is located in the highlands of southwest Asia between the Caspian
Sea and the Persian Gulf. It is bordered on the west by Turkey and Iraq, on
the north by the Soviet Union, on the east by Afghanistan and Pakistan, and
on the south by the Persian Gulf. From the northern border of Iran it is less
than 1,500 nautical miles to Moscow, and from the southwestern border it is
less than 200 nautical miles to the major oil fields of Iraq and the Persian
Gulf.
The country has an area of about 636,000 square miles, about one fifth
the size of the United States. It has a northwest-southeast extent of about
1,400 miles and an east-west extent of about 900 miles.
Climate
The climate of Iran is highly diversified, primarily because of the
influence of topography. Mean annual precipitation varies from over 40
inches along the Caspian Sea coast to less than 8 inches over much of the
interior and the southern coast. Summers are almost rainless over much of
the country. Winter temperatures are cold or very cold in the northwest
mountains, range from mild to cold in the interior, and are warm along the
southern coast. Summer temperatures are hot or very hot in all sections
except at highest elevations.
Topography
Iran consists primarily of an interior area of desert plains and highlands
surrounded by a rugged mountain rimland which forms the perimeter of the
country; small areas of low plains fringe the Caspian Sea and Persian Gulf.
The desert plains are largely barren, except for a few areas in the southeast
with irrigation facilities. The highlands are less barren, but are only culti-
vated on the lower slopes of mountains; there are a few scattered rural
settlements in this area. The mountain rimland composes about one half of
Iran. There are a few deeply incised perennial streams flowing through
intensively cultivated valleys and gorges in the north and west?most of the
populated centers and developed transportation facilities of the rimland are
located in this region.
Iran
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Natural resources
Agriculture?Approximately 14% of Iran's total land area is used for
agricultural purposes. Only about one third of this area is actively cultivated
in any given year because of the need to fallow large areas to conserve
moisture. An additional 16% of the total land area may be potentially
cultivable. Wheat is the leading crop, followed by barley, rice, fruit, sugar
beets, cotton, pulses, oilseeds, tea and tobacco. The agriculture is quite
diversified, and Iran is virtually self-sufficient in all commodities but vegeta-
ble oils, sugar and tea, and wool. A major land reform program undertaken
in 1961 has distributed most of Iran's vast land holdings among the peasants,
and the government is now concentrating on expanding and increasing the
efficiency of agricultural production.
Oil?Oil is Iran's most important natural resource, generating three
fourths of its foreign exchange, and one half of government revenues. Total
estimated oil reserves in Iran (55 billion barrels) are the third largest in the
Middle East, after those of Saudi Arabia and Kuwait, and constituted about
11% of estimated world reserves as of the end of 1968. Oil presently being
exploited lies primarily in southwestern Iran, and, to an increasing extent, in
offshore areas of the Persian Gulf. Vast reserves of oil lie toward the center
of the gulf, and have been divided between Iran and Saudi Arabia. Explora-
tion for oil is being conducted in the Caspian Sea as well.
Other--Iran has large reserves of mineral wealth, but until recently
mining has been a small scale industry. Exploitation has been delayed by
lack of transportation, the absence of smelting facilities and the aridity of
the regions where mines are located. In recent years the government, which
owns all petroleum and mineral deposits, has been speeding development of
these resources. The principal minerals are coal, iron ore, copper, lead and
zinc, chromite, manganese and iron oxide. There are also deposits of sulphur,
nickel, gold, arsenic, magnesia, antimony and borax. Gypsum and salt have
been exploited for centuries.
Human resources
The total population of Iran in 1966, according to the decennial census,
was 25,323,064. In early 1972 the population was estimated to be
29,912,000 with an annual growth rate of 2.9%. By 1966, 54.6% of the
population were under 10 years of age. About 63% of the population may be
referred to as Persians, who constitute the majority of the settled rural
agriculturalists as well as of the urban dwellers. Minority groups (Kurds,
Turks, Arabs) are largely concentrated in border areas of Iran. Most Iranians
are Shi'a Muslims.
Iran
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The 1972 population density of Iran is estimated at 47 persons per
square mile. This figure is not very representative, however, because of the
great variability of population density in different parts of the country. Very
high densities are found in urban areas and moderately high ones in the more
desirable rural regions where fresh water is readily available.
Iran's population is growing rapidly, and life expectancy had increased
from 45 years in 1956 to 50 years in 1966. Depending on the success of
public health measures initiated in recent years, life expectancy could be as
high as 65.8 years by 1986. The government is now concerned about the
high population growth rate and is supporting family planning programs.
Although a long and brilliant Persian literary tradition and a largely
mythological popular historical tradition have fostered a vague sense of
"Persianness," Iran's nearly 30 million people remain basically disunited and
undisciplined, speaking a variety of languages and dialects and belonging to a
number of different subcultures. A strong sense of individualism has long
pervaded the society, with primary loyalties going to self and family;
Iranians have only recently begun to develop a sense of belonging to a
unified nation.
Iranian society is in a state of transition from a traditional Islamic,
agrarian-based one to a more secularized one with emphasis on industry,
technology and rapid economic and social development. Nearly 70% of the
Iranian people live in small, homogeneous villages, many of them relatively
isolated. This provincialism is being gradually changed, due in large part to
the Shah's reform program, which has scattered members of the Health,
Literacy, and Development Corps throughout Iran's villages, and to the
extensive ownership of transistor radios. Almost 30% of the population over
ten years of age were estimated to be literate in early 1972, about double the
percentage in 1956.
Iran
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II. ECONOMIC BACKGROUND
Growth rates and trends
Iran has maintained a 10% annual growth rate since 1964/65 without
significant inflation. This growth resulted primarily from rapidly rising
public investment since 1963, financed largely by increases in oil revenues.
Liberal credit terms, a favorable political climate and rising business confi-
dence, meanwhile, have stimulated large increases in private investment. The
government promotes and encourages both public and private sectors of the
economy.
Iran is nearing the end of its Fourth Development Plan, running from
March 21, 1968 to March 20, 1973. The plan was scheduled to involve an
investment of $10.8 billion, of which 59% was to be from the public sector
and 41% from the private sector. Planned public sector expenditures have
been increased by $.6 billion as a result of cost overruns in major projects.
Actual total expenditures, however, are likely to fall short of the plan
targets, primarily because of delays in implementing some projects. In
general the over all performance of the economy has exceeded plan targets
over the period. In certain important aspects, however, the economy has not
developed along the lines of the plan: imports have been growing at over
twice the rate of GNP growth as opposed to the 13% projected by the plan;
growth in government consumption has not been contained at 10% per
annum; and the ratio of savings to GNP has stayed around 16% rather than
increasing to about 25% as predicted. Despite the faster than expected
growth of oil revenues, the ensuing gap between the plan and reality had to
be met by heavy reliance on foreign borrowing.
The Gross National Product (GNP) in 1971/72 was estimated to be
about $12 billion and per capita GNP about $400.
Major sectors of the economy
The economy of Iran has three main components: an agricultural
sector, a large oil industry, and a rapidly growing but still small industrial
sector.
Agriculture?Despite rapid development in other areas, Iran remains
basically an agrarian society. Agriculture employs almost one half of the
labor force and generates the largest single portion of Iran's GNP (about
22%), and about one half of total non-oil exports. Due in large part to
favorable weather conditions, Iranian agriculture has experienced consistent
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growth since 1964, although not at the rate of the rest of the economy. The
expansion took place despite the disruptive impact of the land reform
program.
One major effect of land reform has been to divide agriculture into two
segments. The major segment consists of traditional village agriculture, where
peasants cultivate fragmented, often uneconomic, plots. The other segment
includes the larger landholdings that either have been retained by landlords
or have been obtained by an emerging class of entrepreneurs for agricultural
enterprises. The eagerness and ability of this latter group to apply model
techniques is likely to give strong impetus to future agricultural growth.
The traditional sector suffers from a general lack of technical knowl-
edge, credit, and marketing facilities, which has impeded more rapid expan-
sion in production. The third phase of the land reform program, officially
launched in 1967, is designed to cope with these problems through improved
training and education, more and better irrigation, improved market prac-
tices, better tools and equipment and, most important, the expansion of
agricultural cooperatives.
Oil industry?The vast majority of Iran's oil resources are exploited and
marketed by a western oil consortium under an agreement reached after Iran
nationalized the oil industry in 1951. The consortium is composed of 40%
British Petroleum, 14% Shell, 6% French and 40% US owned companies.
Iran is guaranteed 56% of the profits, but in fact receives about 70%. The
National Iranian Oil Company (NIOC) is also expanding its oil producing
activities, usually in conjunction with foreign-owned oil companies.
Oil production has risen rapidly since 1960?averaging a 13% increase
annually through 1970 and 19% in 1971?and revenues rose even more
rapidly in 1971 due to the favorable OPEC/Persian Gulf oil settlement of 14
February 1971. Revenues from oil in 1971/72 are expected to be about $2
billion. During the past few years, Iran has pressed the consortium harder for
more rapid growth in production and higher oil revenues. Even with the
1971 OPEC agreement and the January 1972 agreement over dollar devalua-
tion, the Iranian Government is likely to continue to press the foreign oil
companies for even greater revenues.
Other industry--Industry has expanded at the rate of about 12% annu-
ally since 1960. This growth has been largely the result of new industries,
such as those producing metal products, machinery, and transport equip-
ment. Although small-scale cottage industries producing mainly consumer
goods for the domestic market still predominate, factory-type production
and heavy industry are evolving at a rapid rate.
Iran
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The government has been actively promoting industrial development,
particularly import substitution and export industries. Financial incentives,
technical assistance and protection have been provided, and the government
has undertaken training programs to alleviate the serious shortage of trained
workmen and management personnel.
Transportation and communications
The transportation and telecommunications systems of Iran are gener-
ally adequate for peacetime needs and compare favorably with those of
neighboring Middle Eastern countries. The systems are concentrated in the
north and west; the southern and eastern parts of the country have chiefly
desert tracks usable only in dry weather. Development has been mostly on a
north-south axis connecting the Persian Gulf area with the relatively heavily
populated and commercially active north. The government has placed heavy
emphasis on the rapid development of transportation and communications,
particularly to connect new areas of production (such as the steel mill and
related projects in Isfahan) with the populated centers and ports. The
military capability of the Iranian transportation network would be severely
limited by a lack of alternative routes, inadequate distribution in several
large sections of the country and bottlenecks in the highway system. Iran has
an expanding system of oil pipelines to transport oil from the fields to ports
and refineries and to points within Iran for internal consumption. The bulk
of crude oil exports are shipped from the terminal at Kharg Island which was
opened in 1966. A 750-mile pipeline constructed from the southern oil fields
to the Soviet border at Astara carries natural gas used to pay for Soviet
economic and military credits, while feeder lines deliver natural gas for
internal consumption to other Iranian cities.
Foreign trade and balance of payments
Oil?Oil is Iran's most important export commodity, and provided some
80% of the country's export earnings in 1971. Principal importers of Iranian
oil are Western Europe and Japan, followed by southeast Asia, Africa,
Australia, North America, and the Middle East. As noted before, oil produc-
tion is mounting steadily, and is expected to provide about $2 billion in
revenues in 1971/72 (the Iranian year runs from March 21 - March 20). In
order to improve the balance of payments situation, Iran arranged to barter
quantities of oil in Eastern Europe in exchange for technical assistance and
economic credits. In addition, Iran plans to repay nearly $800 million in
Soviet economic and military credits with natural gas, previously flared at
the well head.
Iran
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Imports and exports?Excluding oil exports, Iran traditionally has had
an unfavorable balance of trade, which has worsened in recent years. Exports
are limited to a few primary products, while the country depends on imports
for most capital goods and many manufactured goods and raw materials.
Carpets account for the largest share of non-oil exports, followed by cement,
cotton, fruit, gut, medicinal herbs, minerals, skins and hides, and timber.
Major export markets are Japan, the United Kingdom, Western Europe, the
United States and the USSR.
Iran's rapid rate of economic growth during the past four years has
been characterized by sharply rising imports. By 1970/71, imports were over
four times the level of 1963/64. This annual average growth rate for imports
(23%) exceeded the GNP growth rate by 13%. About 65% of all imports
were intermediate goods, 25% were capital goods, and 10% consumer goods.
The proportion of consumer goods imports to total imports has declined
sharply in the past few years as a result of policies aimed at promoting
import substitution industries, primarily in the field of final industrial
consumer goods. Iran's major trading partners for imports are Western
Europe, the United States, the United Kingdom, and Japan.
Balance of payments?In spite of the large increase in oil revenues,
rising import levels and costs--resulting from the Shah's forced-draft pro-
grams of economic and military development?have led to increasingly large
current account deficits since 1964. Debt servicing repayment obligations
rose from 9% of current receipts in FY 1966 to 20% in FY 1970. Even
greater borrowing abroad?or a disastrous drop in foreign exchange re-
serves?was avoided only by obtaining special payments from the oil compa-
nies in the mid-1960s and again in recent years. A decided improvement in
the balance of payments occurred in FY 1971 largely because of the sharply
increased oil earnings. It is believed that Iran's current account deficit
dropped in FY 1971 to $330 million?less than in any year since FY 1967.
Iran
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III. POLITICAL SITUATION AND TRENDS
Historical background
The Shah rules one of the oldest countries on earth?the recorded
history of Persia stretches back more than 2,500 years. From the early
seventh century A.D., however, Iran was for the most part dominated by
external forces, and by the early 20th century it was debilitated by incompe-
tent administration, foreign domination, and economic and social stagnation.
In 1906 and 1907 a primarily middle class, nationalist revolutionary move-
ment forced the then-ruling Shah to accept a constitutional form of govern-
ment, and the Fundamental Laws of 1906 and 1907 still serve as Iran's
constitution. The present Shah's father seized power in 1921 and was
crowned Reza Shah in 1925. A strong aggressive figure, he began the process
of modernization which his son has continued since his assumption of power
in 1941, and particularly since 1961.
Structure and functioning of the government
The government of Iran is defined as a constitutional monarchy, with
the powers of the Shah limited by a bicameral legislature. The formal powers
of parliament closely resemble those of a European legislature, but in
practice the executive has almost always dominated the legislative and
judicial branches. The present Shah Mohammad Reza Pahlavi has developed
since the early 1960s from an indecisive and insecure leader into a confident
competent monarch who is fully in control of his throne and his govern-
ment. He is known for his detailed knowledge of Iranian affairs at every level
and for his ability to formulate and carry out policies virtually without
challenge. The coronation of the Shah in October 1967, after 26 years of
rule, symbolized the Shah's political coming of age and his pride in Iran's
progress under his rule.
Executive branch?The Shah is chief of state, head of the executive
branch of government, and commander of the military forces. He is assisted
by a prime minister and his cabinet who are theoretically responsible to the
parliament for their actions. The prime minister is hand picked by the Shah,
who also has a deciding voice in determining the members of the cabinet.
The cabinet in 1972 consists of Prime Minister Amir Abbas Hoveyda, a
deputy prime minister, and 24 other ministers. The Shah's influence extends
down through the 300,000 man civil service, and few actions are initiated
which lack at least the tacit approval of the Shah.
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Legislative branch?Iran theoretically has an independent legislative
branch of government, but it is in practice dominated both in form and in
substance by the Shah. All candidates must have the Shah's approval, and
bills which he supports are almost always passed. The parliament is bicam-
eral, consisting of a lower house (Majlis) and an upper house (Senate). The
Majlis, by far the most important, consists of 268 seats (with 2 vacant for
islands of the Persian Gulf) filled by direct popular vote from regional
constituencies and religious minorities for four years. The present Majlis was
elected in July 1971. In practice the Majlis limits itself to passing on policies
proposed arid implemented by the eecutive branch. The Senate is composed
of 60 members, 30 of whom are appointed by the Shah and 30 of whom are
elected by direct popular vote. In theory the Senate's authority extends to
all matters which can be considered by the Majlis except financial affairs, but
in practice the Senate usually gives only pro forma attention to legislation.
Judicial--The Iranian Government traditionally has not separated its
executive and judicial branches. The Shah and his minister of justice effec-
tively control almost the entire judicial structure through the Shah's author-
ity to appoint judges at all except the lowest level of the court system, and
to appoint, dismiss and transfer public prosecutors. Furthermore, the Iranian
Supreme Court has no independent authority to review the constitutionality
of laws or issues; it operates merely as the highest appellate court in the land.
The Iranian judicial system, although better administered than in the past,
still suffers from manipulation, favoritism, and corruption.
Provincial and local government?Iran has a highly centralized system of
local government in which provincial and local officials remain largely
dependent on Tehran for decision-making and financial assistance. The
system descends from provinces and independent governorates to districts.
In rural areas each district is divided into subdistricts, and thence into village
groups and finally villages. Any locality with more than 5,000 inhabitants
may become a municipality. In recent years the Shah has undertaken a
program to improve the quality of local government and to decentralize
administration, but it is proving to be a slow process.
Political dynamics
The Shah is at the pinnacle of political power in Iran; it is he who
determines the direction and content of policy, the nature of political
activity, and the conduct of elections. Below the Shah is a coterie of cabinet
officers, high-level civil servants, political party leaders, military officers, and
"first family" members whose political power is directly related to their
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influence with and access to the Shah. As these persons have no independent
power base, their individual status and membership in the group fluctuates
with the Shah's attitude and wishes.
At the next level is a larger group of middle and lower grade civil
servants, local government officials, reform program corps members, and
religious leaders who are expected to serve more or less as the Shah's
political agents in the field. The great mass of Iranians, both rural and urban,
have no direct influence on the political situation and are probably generally
apathetic toward it. When they do feel strongly about an issue, however,
their attitudes are, in practice, passed up the political grapevine and can
affect policy. Thus, although Iran's government is authoritarian, it is far
from oblivious to rumblings from below.
Both politics and government have traditionally centered around per-
sonal contacts, influence, and the force of personality rather than institu-
tions or political parties. Since 1961, however, the Shah has been building
modern economic and social institutions, and encouraging those whose
ability rests on "what they know" rather than "who they know." Thus,
traditional and modern forces can both be seen at every level of political
power in Iran, and they are forced by the Shah to work together.
The Shah has not, however, created solid political institutions and
Iranians have not been allowed to exercise decision-making in the political
arena. The Shah firmly believes that social and economic development must
be achieved before he can permit the development of political parties in the
Western sense. In effect, the Shah views political activity as the means by
which his program for modernizing Iran will be advertised and carried out.
The greatest weakness of the political system is its dependence on one
man?the Shah. The Queen has been designated Regent if the Shah dies
before the Crown Prince reaches the age of 20, but the extent to which the
people would support her is not known. Almost certainly the military would
step in to assist her at first, but beyond that almost anything could happen.
Political parties?Parties are retained primarily as "windowdressing" for
the Shah; only those groups which support his program are allowed to exist,
and they have little influence. The New Iran Party, the government party, is
by far the strongest in Iran. It controls 231 seats in the Majl is and 28 in the
Senate. Strongly supporting the Shah's program, it has expanded its national
organization into the grass roots in recent years. Its lack of independence,
however, and its reputation as a mouthpiece of the government have pre-
vented the development of genuine public support or enthusiasm for it.
Iran
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The Mardom Party, revived in 1964 with the encouragement of the
Shah who was anxious to have a respectable opposition party, is attempting
to fulfill its function by criticizing the majority party and by occasionally
opposing legislation. Nevertheless, the party remains essentially an adjunct of
the "establishment." The party controls only 36 seats in the Majlis and 2 in
the Senate. I t probably survives only because of the Shah's determination to
maintain a two-party system.
The Pan lranist Party now is apparently moribund. It won no seats in
the 1971 elections. The party is "super-patriotic" and has been used as a
vehicle to asset-t Iran's dominant role in the Persian Gulf and to support the
Iraqi Kurd rebellion. I t has little popular support.
The Iranians Party won a single seat in the Majlis in the 1971 elections.
The party was founded in early 1971 by Dr. FazIlolah Sadr, former deputy
leader of the Pan Iranist Party. The party platform is designed to appeal to
students returning from abroad and other intellectuals.
Elections?Elections in Iran are aimed at improving the democratic
image of the government and at giving the people a feeling of participation in
the governing process rather than at allowing the free expression of opinion.
The electoral process is firmly controlled by the government, though more
subtly in recent years, usually through the weeding out of undesirable
candidates. Elections are viewed by most of the population with apathy, and
with cynicism in more politically aware circles. Despite active "get out the
vote" campaigns, and the improved qualifications of the candidates, many
Iranians do not exercise the right to vote, believing that the outcome is a
foregone conclusion.
Iran's Fundamental Laws provide for two types of elective bodies, the
national parliament and the provincial, district and municipal councils. To
vote in any election in Iran one must be an Iranian citizen of at least 20
years of age who has resided in his electoral district for at least six months.
In the case of senatorial elections a voter must be 25. Among those barred
from voting are insane persons, foreign nationals, criminals and political
convicts, regular members of the armed forces, and police and gendarmerie
officials who reside in the area over which they have authority. Women were
enfranchised in March 1963.
The most recent national elections in Iran were held in July 1971 when
Iranians selected members of the Majlis and Senate. Candidates were care-
fully screened by the parties, the security forces, and the Interior Ministry.
In many constituencies, two "approved" candidates ran for the same seat.
Iran
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There were few instances of blatant manipulation, but the word was passed
that the Shah wanted a wide margin for the New Iran Party?and he got it.
Nearly 5 million ballots were cast, representing 42 percent of the eligible
electorate and a 40 percent greater turnout than during the previous national
election.
Security forces
The Shah relies heavily on both the military and the civilian security
forces for his base of power. All are under his direct control, and he
encourages rivalry among the forces as a security measure. The Shah also
frequently bypasses the official chain of command in making appointments
and in exercising his authority. All of the services are organized on a national
level, with very little regional or local autonomy. Overlapping responsibility
in such fields as reporting antiregime activity and enforcing the narcotics law
has led to competition. Security forces share training facilities, their top
leaders all are usually drawn from the military, and leaders of various forces
at all levels meet together periodically with political officials. The security
forces, including the military, are probably quite adequate to cope with the
limited amount of active dissidence present in Iran.
Iranian National Police?The police force of about 26,000 men is
organized on a national basis, but its area of responsibility covers mainly the
urban areas--cities with over 5,000 people. The entire force is commanded
by the chief of National Police in Tehran, Lieutenant General Jafar Qoli
Sadri, who exercises his authority through the chiefs of police in the cities.
Differences in social and economic status between officers and patrolmen are
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marked, and morale is not high. One problem is that top police posts are
filled by army officers. Although special school and in-service training
programs have been established since World War II, well-trained policemen
are still in the minority. The police are expected to detect crime and
maintain public order.
Imperial Iranian Gendarmerie?The largest of the nonmilitary security
organizations is the Imperial Iranian Gendarmerie, a force of about 67,000
which polices rural areas. It is organized on a national scale and is patterned
along military lines. The gendarmerie performs its routine duties effectively,
but in case of larger problems such as tribal unrest it must call on the armed
forces for reinforcement. In general, the gendarmerie is viewed more favor-
ably by the people in the area of its responsibility than the armed forces.
Improvement in the equipment and installations of the gendarmerie has been
relatively rapid since 1950, when US material support was extended.
Armed Forces?The Iranian armed forces, totaling 196,950 men, is the
largest element in the country's internal security system. It makes units
available to assist the police and gendarmerie in controlling disturbances, and
it sponsors a civilian militia, the National Defense Force, the members of
which have received some training in home guard and guerrilla activities. A
3,000-man Imperial Guard Brigade, which is charged with the security of the
Shah and royal family, can be used for internal security functions also. The
armed forces, with US equipment and training, are increasing their profes-
sional capabilities. They are reliable and their morale is good.
Iran
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IV. SUBVERSION
Subversion, both potential and actual, is increasing in Iran. Most of it
seems to originate from disgruntled Iranian groups who are receiving support
from Iraq. Subversion, however, has not reached serious proportions because
of the effectiveness of the security forces in detecting, infiltrating, and
controlling Iranian dissident elements, a popular optimism that things are
getting better economically and will continue to do so, and a lessening of
Communist pressure as a result of the Soviet policy shift from a hard to a
soft line toward the Iranian regime.
Communist subversion
Communism has a long history in Iran, the first Communist party
having been formed soon after World War I, but at present it offers no threat
to the Shah's rule. The government has firmly suppressed the party since its
peak of popularity in 1952-53, and the USSR's change of policy toward Iran
in 1965 probably gave the death blow to any party hopes for coming into
power in the foreseeable future.
Two formal Communist party organizations are known to exist in Iran,
the Tudeh Party Tehran Organization (TPTO) and the Khuzistan Organiza-
tion of the Tudeh Party. Both appear to be heavily penetrated by the Iranian
security forces. There are perhaps as many as 1,000 party members, although
most of these probably do not belong to organized cells and may confine
their activity to discussions with old party acquaintances. The party has been
ordered to recruit new members but has had little success. Students?once a
fruitful source--are showing more interest in developing their careers than in
political activity. The top Tudeh party leadership has been in Eastern Europe
for many years and has little influence over local members.
The already weak organization has been further split by internal disa-
greements. The Tudeh is under orders from Moscow to avoid criticism of the
Shah and his regime and to stress the Soviet/Iranian rapprochement. Even
the pro-Moscow younger elements in the party chafe at this restriction, and
regard the old-line leaders as too tired and cautious. A deeper rift has been
reported between pro-Russian and pro-Chinese groups. In 1966 two central
committee members were expelled for supporting the Chinese Communists,
and the hard line of the latter appears to be attractive to some opposition
students abroad. Peyk-e-I ran, a radio station established in Leipzig in 1957,
is the voice of the Tudeh Party in exile, and its anti-Shah broadcasts are a
continuing source of irritation to the regime.
Iran
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Non-Communist opposition
It is difficult to estimate the extent of non-Communist opposition in
Iran, since there is no legitimate outlet for the expression of opposition
opinion. The government has stepped up its antidissident activities and in
1972 executed at least 19 persons for treason after secret trials. These moves
followed an upsurge in acts of assassination, sabotage, and repeated bank
robberies by dissident elements, mostly Iraqi-backed Iranian expatriates.
Tribes?Tribal elements in past decades have been a source of difficulty
to the government, and the desire of strong, ambitious tribal leaders for
regional autonomy frequently led to armed clashes. The disappearance of
these leaders through death, exile, or retirement and the increasing presence
of the government in all areas of the country have been slowly bringing the
tribes into the mainstream of contemporary Iranian life. Government pro-
grams, too, are now directed as much toward the tribes as toward the
city-dweller or the settled farmer.
The Kurds perhaps retain the greatest potential for disruptive activity.
The perennial Kurdish rebellion in Iraq has had some repercussions in Iran,
and a few rebellious exiled Iranian Kurds would like to return to start
guerrilla warfare. Despite isolated incidents from time to time, there seems
to be little chance of an effective Kurdish movement in Iran.
A few exiled Iranians of Arab ethnic origin have formed the Khuzestan
Liberation Front aiming at autonomy for the province of Khuzestan, which
has a large percentage of Arabs. The government has expressed concern that
the group appears to get some support from radical Arab states, but the
group is penetrated by Iranian security forces, and the vast majority of
Iranian Arabs appear to be passive.
Others--The old nationalist organizations, particularly the National
Front, which reached their heyday during the regime of former Prime
Minister Mossadeq in the early 1950s have virtually disappeared, fragmented
by government suppression and the success of the Shah's reform program. A
younger group of nationalists inclined toward "activism" exists and tends to
attract the educated, the students, and younger members of the establish-
ment. Its commitment is to political modernization and, at the least, a sharp
reduction in the Shah's power. The extremists in this group probably have
ties with the Iraqis and the Confederation of Iranian Students, an anti-Shah
group outside the country.
Another opposition group, with a potentially larger following, is the
religiously conservative bazaar element, both clerical and secular. Its opposi-
tion is based on resistance to Westernization and to the secularization of
Iran
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traditional Islamic institutions through the reform program. The clergy
recently has been annoyed by the regime's efforts to establish a Religious
Corps for the purpose of bringing religious activities under government
control.
Iran
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VI. ARMED FORCES
Defense organization
The Imperial Iranian Armed Forces comprise both the military forces
and the paramilitary forces. The Shah, as supreme commander, exercises
actual control of the armed forces even to the extent of arbitrarily con-
cerning himself with detailed day-to-day operations. Operational control is
theoretically delegated, through the chief of the Supreme Commander's
Staff (SCS), to the commanders of the individual services?ground forces,
navy, and air force?none of whom, however, is a member of the SCS. The
Shah often exercises his command prerogatives through direct contact with
senior officers, whether or not they are members of the SCS. The position of
chief, SCS, has the equivalent of ministerial rank, although the incumbent is
not a member of the cabinet. The minister of war, technically responsible to
the prime minister, has equal status with the chief, SCS, and takes his orders
directly from the Shah. He is not in the operational chain of command, but
is responsible primarily for representing the military forces in the Iranian
parliament and for supervising legal and budgetary matters. The minister of
interior is normally responsible for the operations of the gendarmerie and
the national police; in times of war or national emergency, however, the
gendarmerie is placed under the operational control of the SCS. Although
the SCS is iheoretically responsible just for long range planning and inter-
service coordination, it actually exercises direct control and much of the
day-to-day direction of the services. The staffs of the service commanders are
frequently ignored and their functions usurped by the senior staff.
Manpower
As of 1 January 1972, Iran had approximately 7,052,000 males
physically fit for military service between the ages of 15 and 49. The average
number of males reaching military age (21) annually is 275,000 and approxi-
mately 65,000 are inducted into the armed forces annually. The military
forces, totaling approximately 293,000 men including staff positions, com-
prise a predominantly conscript ground force of about 158,600; an air force
of 39,700 with 286 aircraft, including 209 tactical jet fighters; and a navy of
10,500 with 48 ships and craft and ten hovercraft. The paramilitary forces
comprise a 67,000-man gendarmerie, which has a wartime mission under
ground forces command. In addition there is a 26,000-man national police
force which has minimal paramilitary capability.
Iran Apr 72
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Defense budget
Iranian Defense Budgets
(Equivalent in millions of US Dollars*)
1966
1967
1968
1969
1970
1971
Defense Budget a/
317
503
618
768
910
1,170
% of national budget
22
29
28
30
32
29
% of GNP
4.9
6.9
7.6
8.5
8.9
9.8
*One rial equals US$0.0132
L11 includes internal security
Logistics
In January 1966, the former all-service Imperial Iranian Logistics
Command was placed under the control of the ground forces and redesig-
nated the Logistics Support Command. While the navy and air force will
eventually become self-sufficient in logistics, the transfer of responsibility is
occurring only gradually. The Logistics Support Command is responsible for
the procurement, storage, and issue of all items for the ground forces and all
common items of supply for the navy and air force. The navy and air force
have become responsible for those items peculiar to their respective ele-
ments. The Logistics Support Command has responsibility for ground forces
general depots and all technical departments, including ordnance, signal,
engineer, medical, quartermaster, transportation, and veterinary.
For common items of supply, the air force and navy deal directly with
the Logistics Support Command main depots in Tehran. Ground forces
elements in the Tehran area also draw their supplies from the main depots;
however, units in the field obtain supplies under a system of field army
depots which have been established in the three field army areas. The field
army depots support ground forces supply points, and only the field army
depots are authorized to deal directly with the main depots.
The US Military Assistance Program has furnished major items of
equipment for all of the military services. The armed forces have adopted the
US system of maintenance, and out-of-commission rates for equipment are
declining. The Iranians have also purchased on credit $325 million worth of
Soviet military equipment, including armed personnel carriers and heavy
artillery.
Iran
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The over-all logistical system, still considerably short of realizing its full
potential, is adequate for normal peacetime and internal security operations,
but not for full-scale combat operations.
Iran
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VII. FOREIGN RELATIONS
The Shah since 1965 has evolved a new independent foreign policy
consisting basically of a rapprochement with the Soviet Union and Eastern
Europe, reduced dependence on the United States, and efforts to secure the
Persian Gulf against incursions by radical Arab states. Although Iran retains
close ties with the United States and is essentially pro-Western in outlook,
the Shah believes it is advantageous for his country to broaden its sources of
economic credits, trade, and military equipment to include the Communist
world. He also feels that his record of cooperation with the West entitles Iran
to major new oil markets in the United States. An increase in US imports of
Iranian oil has become a preoccupation of the Shah, inasmuch as his
development plans depend on oil income. His fear of Soviet military aggres-
sion has been displaced to a large extent by his belief that radical Arab forces
have designs on the Persian Gulf and on Iran's oil rich province of Khuzestan.
The Shah questions whether the United States would defend him in case of a
regional conflict not involving a Communist nation, and he is determined to
line up other sources of support and supply in the East European Commu-
nist countries, in Western Europe, among the moderate Arab states, and in
South Asia.
The turning point in Iranian-Soviet relations came in 1965 when, after
the Shah's visit to Moscow, the USSR agreed to extend credit equal to
US$289 million toward building a long-sought steel mill and related projects.
The expansion of economic ties with the Soviet Union has clear advantages
for Iran, since interest rates run as low as 2.5% and repayment of the credits
is to be made largely in natural gas which has been wasted in the past. Under
similar repayment arrangements, Iran has received an additional $300 million
in economic credits and has purchased $325 million in unsophisticated
military equipment. The new policy has also had political benefits by
appeasing those Iranians who believed their country was overly committed
to the West. Nevertheless, the Shah is aware that the rapprochement involves
a Soviet effort to gain influence in Iran and that the USSR is basically
opposed to his monarchy. The Shah is also concerned over Soviet involve-
ment with the radical Arab states and over the possibility of Soviet incur-
sions into the Persian Gulf region.
Since 1965, the Shah's major foreign policy preoccupation has been the
security of the Persian Gulf and southwestern Iran?especially since the
British announced that they would withdraw militarily from the gulf by
1971. The Shah is convinced that radical Arab elements are attempting to
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undermine Iranian authority in the area and to foment subversion in the
province of Khuzestan, which has a large number of ethnic Arabs. Iranian
officials have made it clear that they are willing to cooperate with the
moderate Arab states of Saudi Arabia and Kuwait, but that these states must
recognize Iranian primacy in the area.
Relations with the radical Arab states are aggravated by mutual suspi-
cion and traditional Arab-Persian hostility, Iran's close, but discreet, rela-
tions with Israel, and Iran's seizure of three small islands in the lower Persian
Gulf. Iranian relations with the conservative Arab states which are still ruled
by kings?Jordan, Saudi Arabia?are improving.
Since Iraq's 1958 revolution, relations between Iran and Iraq have
ranged from cool to openly hostile. Both countries in recent months have
engaged in creating trouble in each others territory. Iran has supplied arms,
money, and transit rights to the dissident Iraqi Kurds led by Mustafa Barzani
and has encouraged coup plotting by other dissatisfied Iraqi elements. In
turn, Iraq has created difficulties for its residents of Iranian origin and forced
large numbers of them to return to Iran. Iraq has also trained, equipped, and
sent into Iran sabotage teams and permitted raids into Iran by pro-Iraqi
Kurds. The dispute over the Shatt al-Arab River boundary remains a peren-
nial irritant in Iran-Iraq relations.
Iran has attempted, for the most part, to maintain a carefully correct
attitude toward Afghanistan. Suspicion of Soviet influence in that country
and the problem of the division of water from the Helmand River are
long-standing sources of dispute.
Late in 1955, along with Turkey, Iraq, Pakistan, and the United
Kingdom, Iran signed the Baghdad Pact, which was designed to provide for
regional defense against the USSR. Although the Shah no longer views the
organization (renamed CENTO after Iraq withdrew in 1959) as an effective
military shield, he is not likely to pull out because of the economic benefits
to be gained through membership. In 1964, Iran, Turkey, and Pakistan
formed an organization, called Regional Cooperation for Development
(RCD), for the purpose of creating closer cooperation among the three
nations in economic and cultural fields.
The Shah has been expanding his influence in various nonaligned and/or
Western-oriented countries. Since 1967 he has visited many countries, and
has expounded the virtues of his reform program.
Iran has been a member of the United Nations since 1945, has paid its
dues regularly and has usually supported the policies of the US in the various
Iran
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UN bodies. The Shah has praised the organization as valuable for preserving
peace and has supported its efforts toward disarmament and nuclear weap-
ons control. In general, Iran maintains relations with those governments of
Africa, the Far East, and Latin America with which the United States has
relations.
Iran
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VIII. US INTERESTS
The United States concluded a bilateral defense agreement in March
1959 with each of the Middle East members of CENTO, including Iran. The
agreement, which is specifically tied to the 1957 Joint Congressional Resolu-
tion to Promote Peace and Stability in the Middle East (the Eisenhower
Doctrine), says that the US Government, in accordance with the US Consti-
tution, will take "such appropriate action, including the use of armed forces,
as may be mutually agreed upon" in the case of Communist aggression
against Iran. About 940 US Department of Defense personnel, most of them
involved with the Military Assistance Program, are stationed in Iran.
In the period FY 1946 to FY 1970, the United States loaned Iran
$596.3 million, of which $317.5 million has been repaid. Total grants for the
period were $455.3 million. The Military Assistance Program totaled
$1,1334.5 million, of which $504.1 million were loans advanced ($140.9
million has been repaid). The US economic aid program in Iran ended by
mutual agreement in November, 1967, but Iran continues to purchase in the
United States most of its sophisticated military equipment under Export-Im-
port Bank credits. Military credit sales to Iran of $140 million and $200
million have been authorized for the fiscal years 1972 and 1973. In 1970/71
Iran imported $220 million worth of US goods and exported non-oil goods
valued at $24 million to the US. Total US private direct investment in Iran is
estimated at well above $300 million (including petroleum).
Iran Apr 72
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