RUSI Analysis, 1 Oct 2013 By Shashank Joshi, Research Fellow

With the primary signs of a US-Iran thaw, there are great hopes – and great cynicism. Yet while the optimists might be overstating the scope of any deal, the cynics are wrong to dismiss Hasan Rouhani’s rhetoric.

In the top, there has been no handshake – but there has been a phone call. Iranian President Hasan Rouhani first rebuffed the White House’s offer of a historic meeting with President Barack Obama but, previous to departing the us, initiated a telephone conversation that was thin on substance but rich in symbolism. That decision, in addition to Rouhani’s relentlessly conciliatory tone, has prompted euphoria amongst some, who foresee a geopolitical re-alignment as significant as President Richard Nixon’s opening to China in 1971, and alarm in others, who see Rouhani because the mask behind which the Islamic Republic pursues its unchanged objectives. How should we assess his trip, and the prospects for nuclear and broader diplomacy? Below, I suggest four points that emerge from the past week’s diplomatic drama.

Has Rouhani Checkmated Iran?

First, the notion that Rouhani has ‘checkmated’ Obama – as Fouad Ajami put it  – is untenable. The Obama administration has not just given nothing away, but continues to impose upon Iran the foremost punishing sanctions ever applied to a would-be nuclear proliferator. Iran’s oil exports have more that halved in volume over the last year, inflation is around 60 percent, and over 1 / 4 of Iranian youth are unemployed. The concept Obama is all carrot and no stick is egregiously wrong. On this regard, the chance cost of discussion is negligible.

Is Rouhani All Talk?

Second, some suggest that Rouhani is offering nothing greater than empty words – a ‘smiley campaign’, as Israel’s intelligence minister put it – but no concrete actions. This view is usually mistaken. Rouhani has already freed greater than 80 political prisoners, lots of whom were arrested through the 2009 Green Revolution. The Islamic Republic remains an autocratic regime which holds large numbers of political prisoners and commits grave human rights abuses all the time. However the prisoner release is an indication that Rouhani is willing and ready to at the least partially follow through on pledges he made on his campaign trail.

With respect to the nuclear dispute, Rouhani most crucial action thus far have been to take away the nuclear file from the Supreme National Security Council – that’s more easily influenced by hardliners – and handed it to the more moderate foreign ministry, run by Mohammad Javad Zarif. Western diplomats see Zarif as reasonable and pragmatic, a much cry from previous nuclear negotiator Saeed Jalili.

Rouhani couldn’t have changed these arrangements without the approval of Iran’s Supreme Leader, Ali Khamenei. Indeed, the Washington Post’s well-connected columnist David Ignatius reported last week that ‘Western intelligence reports’ confirmed Rouhani’s claim to be ‘fully empowered to finalize the nuclear talks’. Obviously, this claim can only be fully tested on the negotiating table.

Yet additionally it is important to recognise that Rouhani’s supposedly empty rhetoric – his praise for Americans, enthusiasm for dialogue, and exhortations to the Iranian Revolutionary Guard Corps (IRGC) to remain out of politics – shouldn’t be without domestic political cost. If this round of diplomacy involves nothing, Rouhani should be severely depleted of political capital and Khamenei will happily let him twist within the wind. Words are never enough to strike a deal, but nor should they be discounted too flippantly. They show that Rouhani is willing to anger domestic constituencies in pursuit of his agenda. That may be a positive sign.

Are the usa and Iran Reconciling or Accommodating?

Is Obama Sacrificing Israeli Interests?