Iran’s trade with Shanghai Cooperation Organization’s member states, excluding crude oil exports, stood at 33.8 million tons worth $27.02 billion during the first eight months of the current fiscal year (March 21-Nov. 21), latest data released by the Islamic Republic of Iran Customs Administration show.
China with 23.03 million tons worth $9.78 billion was Iran’s main trade partner among SCO member states during the period. It was followed by India with 4.51 million tons worth $1.93 billion and Russia with 2.62 million tons worth $1.01 billion.
Iranian exports hit 27.18 million tons worth $13.47 billion during the period.
China with 20.27 million tons worth $10.41 billion, India with 3.18 million tons worth $1.26 billion and Pakistan with 2.62 million tons worth $1.01 million were the main export destinations.
Imports stood at 6.62 million tons worth $13.55 billion during the eight months ending Nov. 21.
China with 2.73 million tons worth $9.78 billion, India with 1.13 million tons worth $1.93 billion and Russia with 1.72 million tons worth $1.01 billion were the major exporters.
The Shanghai Cooperation Organization is a Eurasian political, economic and security organization. In terms of geographical scope and population, it is the world's largest regional organization, covering approximately 60% of the area of Eurasia, 40% of the world population and 30% of global GDP.
SCO is a successor to the Shanghai Five, a mutual security agreement formed in 1996 between China, Kazakhstan, Kyrgyzstan, Russia and Tajikistan. On 15 June 2001, the leaders of these nations and Uzbekistan met in Shanghai to announce a new organization with deeper political and economic cooperation; the SCO Charter was signed on July 7, 2002, and entered into force on Sept. 19, 2003. Its membership has since expanded to eight states, with India and Pakistan joining on June 9, 2017. Several countries are engaged as observers or dialogue partners.
A Step Closer to Asian Multilateralism
Iran signed a memorandum on Sept. 16 during a summit at Samarkand, Uzbekistan, for joining the security bloc, the largest regional body in the world in terms of population governed. This bloc is thriving as a multi-polar body and it is not West-centric.
The Iranian Parliament approved the bill for Iran's membership in the Shanghai Cooperation Organization with an overwhelming majority in November.
Abolfazl Amouei, the spokesman of Majlis National Security and Foreign Policy Commission, said the parliament's approval of Iran's SCO membership contains an international message of "Iran's multilateralism tendency in the field of foreign policy."
Iranian Foreign Minister Hossein Amir-Abdollahian welcomed the parliament's move on Twitter, saying that "the categorical vote for the bill on the accession of the Islamic Republic of Iran to the SCO is indicative of our country's resolve and seriousness to develop regional, international and economic cooperation and bolster (the country's) approach to Asia."
Helping the country to protect its core interest amid the United States-led sanctions that have for long crippled its economy, Iran’s accession to Shanghai Cooperation Organization demonstrates Tehran’s commitment to Asian multilateralism, Asian News International wrote citing the Policy Research Group.
“The SCO accession is seen as a positive step forward for Iran, rather than a diplomatic triumph for the country which has long been battered by Western sanctions giving a blow to its economy. Iran can lead the way in emerging as a key partner for India and other Asian nations, especially through the International North-South Transportation Corridor,” it concluded.
Top Level Economic Cooperation Away From Sanctions
It is not yet known whether Iran and the United States will return to the nuclear agreement. But, whether they do or not, it appears that Iran’s international isolation is nearing an end, read an Op-Ed published by Responsible Statecraft, as Iran signed a memorandum of obligations to become a permanent member of the Shanghai Cooperation Organization.
At a meeting in April 2023, full membership will be finalized. As a result, Iran will join an organization that represents 43% of the world’s population, making it the second largest international organization after the UN.
SCO has also become a high priority for both Russia and China. Its purpose is to act as an economic and foreign-policy counterweight to the US-led unipolar world.
Beginning with only six members in 2001, the SCO eventually grew to a limited membership of eight when India and Pakistan joined in 2017. Iran is being welcomed as only the ninth member of the organization, though many more are now in line. Membership will grant Tehran top level contacts and economic cooperation with Russia, China, India, Pakistan, and several Central Asian countries — nearly half the population of the world, making up 28% of the global GDP.
“Iran has historically been a trading nation,” Vienna-based strategy consultant Bijan Khajehpour told Responsible Statecraft.
“Sanctions disrupted the trade patterns, but Iran’s response to the US maximum pressure has been to focus on its immediate neighbors as well as on Eastern powers. The policy is primarily driven by security as well as economic imperatives. A full SCO membership will further facilitate Iran’s trade with Asian powers and Russia, compensating for the decline in trade with the EU that has decreased due to US sanctions.”
Khajehpour noted that though Iran is not so confident as to feel insulated from US sanctions, and though they may hope to keep the door to the West open, Iran’s choice may no longer be capitulation or isolation. “The intended isolation of Iran, which has largely focused on sealing off the country’s western border, has caused a very large leak in the eastern one. And Iran is not just breaking out of isolation globally in the East; they are also breaking out regionally in the Middle East,” he added.
In August, both the UAE and Kuwait announced that they will be returning their ambassadors to Tehran. Since both countries withdrew their ambassadors in 2016 in solidarity with Saudi Arabia, the moves suggest that Riyadh, though not yet reopening an embassy in Tehran, may approve of its fellow [Persian] Gulf states’ decision to pursue detente.
The possibility of a warming Saudi Arabia is supported by reports that Saudi Crown Prince Mohammed bin Salman has suggested a meeting between Saudi Arabia and Iran’s foreign ministers. The two countries, often bitter rivals in the region, have been talking since 2020. They have now met several times, and, on April 25 of this year, they held their “fifth round of ‘positive’ talks in Baghdad … on normalizing bilateral relations.”
On August 22, the Iranian Foreign Ministry said “talks with Saudi Arabia over resuming ties are also going in a positive direction.”
Also in August, the UAE Foreign Ministry said that the return of its ambassador to Iran was part of efforts “to achieve the common interests of the two countries and the wider region.” The foreign ministers of the two nations held a phone call the week before in which they discussed “boosting bilateral relations and areas of cooperation for the benefit of both countries.”
At the same time, Kuwait announced the appointment of its ambassador to Iran.
The series of recent moves, including the 2021 signing of a 25-year strategic and economic partnership with China that is worth $400 billion, last month’s opening of embassies in Tehran by the UAE and Kuwait, and this week’s ascension to full membership in SCO, indicate that even if the negotiations to restart the Iran nuclear deal fall through and Western sanctions remain in place, the isolation of Iran may be over.
