Issue Brief on “The Iran-China Deal: A New Strategic Partnership in the Making?”

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Iran and China are reported to be in the final stages of finalizing a $400 bn deal for strategic partnership including massive Chinese investments in energy and infrastructure projects, closer defense cooperation, intelligence sharing and sale of discounted oil from Iran to China. Once finalized, the deal will have a major impact on the geopolitics and economics of this critically vital region. During a state visit to Tehran in 2016, the Chinese President Xi Jinping had proposed a comprehensive deal to forge a long-term strategic partnership between the two countries.[1]The draft for this robust package of investment and energy partnership is said to have been approved by the Iranian side. The 18-page long agreement highlighting the various significant sectors of cooperation between a major world power and a sanction-hit economy in the region indicates a massive shift in the global geopolitical arena. Terms of the deal have not been made public by China and it still requires the Parliament’s approval in Iran. But the Iranian Foreign Minister Mohammad Javad Zarif confirmed earlier this month that the two sides were indeed negotiating a massive deal.[2]

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