Changes

* Industry: Types--petroleum, petrochemicals, textiles, cement and building materials, food processing (particularly sugar refining and vegetable oil production), metal fabricating (particularly steel and copper), armaments.

* Industry: Types--petroleum, petrochemicals, textiles, cement and building materials, food processing (particularly sugar refining and vegetable oil production), metal fabricating (particularly steel and copper), armaments.

* Trade (2005): Exports--$55.42 billion: petroleum 80%, chemical and petrochemical products, carpets, fruits, nuts. Major export partners (2005): Japan (16.9%), China (11.2%), Italy 5.9%), South Korea (5.8%), South Africa (5.8%), Turkey (4.6%), Netherlands (4.5%), France (4.4%), Taiwan (4.1%). Imports--$42.5 billion: industrial raw materials and intermediate goods, capital goods, foodstuffs and other consumer goods, technical services, military supplies. Major import partners: Germany (13.7%), UAE (8.3%), China (8.2%), Italy (7%), France (6.2%), South Korea (5.3%), Russia (4.8%).

* Trade (2005): Exports--$55.42 billion: petroleum 80%, chemical and petrochemical products, carpets, fruits, nuts. Major export partners (2005): Japan (16.9%), China (11.2%), Italy 5.9%), South Korea (5.8%), South Africa (5.8%), Turkey (4.6%), Netherlands (4.5%), France (4.4%), Taiwan (4.1%). Imports--$42.5 billion: industrial raw materials and intermediate goods, capital goods, foodstuffs and other consumer goods, technical services, military supplies. Major import partners: Germany (13.7%), UAE (8.3%), China (8.2%), Italy (7%), France (6.2%), South Korea (5.3%), Russia (4.8%).

 

== PEOPLE ==

== PEOPLE ==

Iran is a pluralistic society. Persians are the largest predominant ethnic and cultural group in this country, though many are actually of mixed ancestry. The country has important Turkic elements (e.g. Azeris) and Arabs predominate in the southwest. In addition, Iranian citizens include Kurds, Balochi, Bakhtyari, Lurs, and other smaller minorities, such as Armenians, Assyrians, Jews, and Brahuis (or Brohi).

Iran is a pluralistic society. Persians are the largest predominant ethnic and cultural group in this country, though many are actually of mixed ancestry. The country has important Turkic elements (e.g. Azeris) and Arabs predominate in the southwest. In addition, Iranian citizens include Kurds, Balochi, Bakhtyari, Lurs, and other smaller minorities, such as Armenians, Assyrians, Jews, and Brahuis (or Brohi).

The 1979 Islamic revolution and the 1980-88 war with Iraq transformed Iran's class structure politically, socially, and economically. During this period, Shia clerics took a more dominant position in politics and nearly all aspects of Iranian life, both urban and rural. After the fall of the Pahlavi regime in 1979, much of the urban upper class of prominent merchants, industrialists, and professionals, favored by the former monarch, the shah, lost standing and influence to the senior clergy and their supporters. Bazaar merchants, who were allied with the clergy against the Pahlavi shahs, also have gained political and economic power since the revolution. The urban working class has enjoyed somewhat enhanced status and economic mobility, spurred in part by opportunities provided by revolutionary organizations and the government bureaucracy. Though the number of clergy holding senior positions in the parliament and elsewhere in government has declined since the 1979 revolution, Iran has nevertheless witnessed the rise of a post-revolutionary elite among lay people who are strongly committed to the preservation of the Islamic Republic.

The 1979 Islamic revolution and the 1980-88 war with [[Directory:Iraq|Iraq]] transformed Iran's class structure politically, socially, and economically. During this period, Shia clerics took a more dominant position in politics and nearly all aspects of Iranian life, both urban and rural. After the fall of the Pahlavi regime in 1979, much of the urban upper class of prominent merchants, industrialists, and professionals, favored by the former monarch, the shah, lost standing and influence to the senior clergy and their supporters. Bazaar merchants, who were allied with the clergy against the Pahlavi shahs, also have gained political and economic power since the revolution. The urban working class has enjoyed somewhat enhanced status and economic mobility, spurred in part by opportunities provided by revolutionary organizations and the government bureaucracy. Though the number of clergy holding senior positions in the parliament and elsewhere in government has declined since the 1979 revolution, Iran has nevertheless witnessed the rise of a post-revolutionary elite among lay people who are strongly committed to the preservation of the Islamic Republic.

Most Iranians are Muslims; 89% belong to the Shi'a branch of Islam, the official state religion, and about 9% belong to the Sunni branch, which predominates in neighboring Muslim countries. Non-Muslim minorities include Zoroastrians, Jews, Baha'is, and Christians.

Most Iranians are Muslims; 89% belong to the Shi'a branch of Islam, the official state religion, and about 9% belong to the Sunni branch, which predominates in neighboring Muslim countries. Non-Muslim minorities include Zoroastrians, Jews, Baha'is, and Christians.

== HISTORY ==

== HISTORY ==

During World War Two, Iran had been a vital link in the Allied supply line for lend-lease supplies to the Soviet Union. After the war, Soviet troops stationed in northwestern Iran not only refused to withdraw but backed revolts that established short-lived, pro-Soviet separatist regimes in the northern regions of Azerbaijan and Kurdistan. These ended in 1946. The Azerbaijani revolt crumbled after U.S. and United Nations (UN) pressure forced a Soviet withdrawal. Iranian forces also suppressed the Kurdish uprising.

During World War Two, Iran had been a vital link in the Allied supply line for lend-lease supplies to the Soviet Union. After the war, Soviet troops stationed in northwestern Iran not only refused to withdraw but backed revolts that established short-lived, pro-Soviet separatist regimes in the northern regions of Azerbaijan and Kurdistan. These ended in 1946. The Azerbaijani revolt crumbled after U.S. and United Nations (UN) pressure forced a Soviet withdrawal. Iranian forces also suppressed the Kurdish uprising.

In 1951, the government of nationalist Prime Minister Mohammed Mossadeq (sometimes spelled Mossadegh) nationalized the British-owned Anglo-Iranian Oil Company (AIOC). The Shah fled to Rome from Iran before the U.S.-backed coup against Mossadeq in August 1953, during which pro-Shah army forces arrested the Prime Minister. The Shah returned soon thereafter. A few years later, AIOC was renamed British Petroleum, better known today as BP.

In 1951, the government of nationalist Prime Minister Mohammed Mossadeq (sometimes spelled Mossadegh) nationalized the British-owned Anglo-Iranian Oil Company (AIOC). The Shah fled to Rome from Iran before the U.S.-backed coup against Mossadeq in August 1953, during which pro-Shah army forces arrested the Prime Minister. The Shah returned soon thereafter to run the country under an authoritarian régime, complete with agents of the Iranian intelligence agency patrolling the streets and cracking down on what was considered "sedition" with repression, torture, and extrajudicial detentions. A few years later, AIOC was renamed British Petroleum, better known today as BP.

In 1961, Iran initiated a series of economic, social, and administrative reforms that became known as the Shah's White Revolution. The core of this program was land reform. Modernization and economic growth proceeded at an unprecedented rate, fueled by Iran's vast petroleum reserves, the third-largest in the world. However, his autocratic method of rule and pro-western policies alienated large sectors of the population, including the Shia clergy.

In 1961, Iran initiated a series of economic, social, and administrative reforms that became known as the Shah's White Revolution. The core of this program was land reform. Modernization and economic growth proceeded at an unprecedented rate, fueled by Iran's vast petroleum reserves, the third-largest in the world. However, his autocratic method of rule and pro-western policies alienated large sectors of the population, including the Shia clergy.

In February 2004 flawed elections were held for the Seventh Majles in which many reformists were prohibited from contesting their seats, meaning that a much more conservative group of parliamentarians would easily retake control of the Majles in May 2004.

In February 2004 flawed elections were held for the Seventh Majles in which many reformists were prohibited from contesting their seats, meaning that a much more conservative group of parliamentarians would easily retake control of the Majles in May 2004.

Presidential elections took place on June 17, 2005, resulting in a two-candidate runoff between Mahmud Ahmadi-Nejad and former-president Akbar Hashemi Rafsanjani on June 24. Ahmadi-Nejad won in the second round, taking office in August 2005. The next presidential elections are scheduled for 2009.

Presidential elections took place on June 17, 2005, resulting in a two-candidate runoff between Mahmoud Ahmadinejad and former-president Akbar Hashemi Rafsanjani on June 24. Ahmadinejad won in the second round, taking office in August 2005. The next presidential elections are scheduled for 2009. The president, however, is not the country's primary authority; that is the position of the Supreme Leader.

 

== GOVERNMENT ==

== GOVERNMENT ==

The Council of Guardians consists of 12 persons. The Supreme Leader appoints the six religious members of the Council of Guardians while the Iranian parliament, the Majles, selects the six lay members from candidates recommended by the judiciary, which is in turn selected by the Supreme Leader. The latter group plays a role only in determining whether legislation before the Majles conforms to Iran’s constitution. The religious members, on the other hand, take part in all deliberations, considering all bills for conformity to Islamic principles. The Council of Guardians can veto any law. This body also certifies the competence of candidates for the presidency, local government councils, the Assembly of Experts and the Majles.

The Council of Guardians consists of 12 persons. The Supreme Leader appoints the six religious members of the Council of Guardians while the Iranian parliament, the Majles, selects the six lay members from candidates recommended by the judiciary, which is in turn selected by the Supreme Leader. The latter group plays a role only in determining whether legislation before the Majles conforms to Iran’s constitution. The religious members, on the other hand, take part in all deliberations, considering all bills for conformity to Islamic principles. The Council of Guardians can veto any law. This body also certifies the competence of candidates for the presidency, local government councils, the Assembly of Experts and the Majles.

The president of the Islamic Republic of Iran is elected by universal suffrage to a four-year term. If no candidate receives a simply majority during elections, the top two vote-getters compete in a run-off. Voter turn-out was quite low, but Mahmud Ahmadi-Nejad won 62% in the elections in 2005, while former president Akbar Hashemi Rafsanjani received only 36% of the vote.

The president of the Islamic Republic of Iran is elected by universal suffrage to a four-year term. If no candidate receives a simply majority during elections, the top two vote-getters compete in a run-off. Voter turn-out was quite low, but Mahmud Ahmadinejad won 62% in the elections in 2005, while former president Akbar Hashemi Rafsanjani received only 36% of the vote.

The president supervises the affairs of the executive branch, appointing and supervising the Council of Ministers (members of the cabinet), coordinating government decisions, and selecting government policies to be placed before the National Assembly.

The president supervises the affairs of the executive branch, appointing and supervising the Council of Ministers (members of the cabinet), coordinating government decisions, and selecting government policies to be placed before the National Assembly.

== Principal Government Officials ==

== Principal Government Officials ==

* Leader of the Islamic Revolution--Ali Hoseini-Khamenei

* Leader of the Islamic Revolution: Ali Hoseini-Khamenei

* President--Mahmud Ahmadi-Nejad

* President: Mahmoud Ahmadinejad

* First Vice President--Mohammad Reza Aref-Yazdi

* First Vice President: Mohammad Reza Aref-Yazdi

* Foreign Minister--Manouchehr Mottaki

* Foreign Minister: Manouchehr Mottaki

* Ambassador to the United Nations--Mohammad Javad Zarif

* Ambassador to the United Nations: Mohammad Javad Zarif

 

== POLITICAL CONDITIONS ==

== POLITICAL CONDITIONS ==

By mid-1982, the clergy had won a succession of post-Revolution power struggles that eliminated first the center of the political spectrum and then the leftists, including the communist Tudeh party. Assassinations, throwing acid in the faces of women who refused to wear the veil, and other acts of violence punctuated this period. There has been some moderation of excesses since the early days of the revolution, and the country experienced a partial "thaw" in terms of political and social freedoms during the tenure of former president Khatami, but serious problems remain. These include human rights violations, worsening constraints on press freedom and civil liberties, and, internationally, Iran remains a major state sponsor of terrorism.

By mid-1982, the clergy had won a succession of post-Revolution power struggles that eliminated first the center of the political spectrum and then the leftists, including the communist Tudeh party. Assassinations, throwing acid in the faces of women who refused to wear the veil, and other acts of violence punctuated this period. There has been some moderation of excesses since the early days of the revolution, and the country experienced a partial "thaw" in terms of political and social freedoms during the tenure of former president Khatami, but serious problems remain. These include human rights violations, worsening constraints on press freedom and civil liberties, and, internationally, Iran remains a major state sponsor of terrorism.

The Islamic Republican Party (IRP) was Iran's sole political party until its dissolution in 1987. Iran now has a variety of groups engaged in political activity; some are oriented along ideological lines or based on an identity group, others are more akin to professional political parties seeking members and recommending candidates for office. Some are active participants in the Revolution’s political life while others reject the state. Conservatives consistently thwarted the efforts of reformists during the Khatami era and have consolidated their control on power since the flawed elections for the seventh Majles in 2004 and president Ahmadi-Nejad’s victory in 2005.

The Islamic Republican Party (IRP) was Iran's sole political party until its dissolution in 1987. Iran now has a variety of groups engaged in political activity; some are oriented along ideological lines or based on an identity group, others are more akin to professional political parties seeking members and recommending candidates for office. Some are active participants in the Revolution’s political life while others reject the state. Conservatives consistently thwarted the efforts of reformists during the Khatami era and have consolidated their control on power since the flawed elections for the seventh Majles in 2004 and president Ahmadinejad’s victory in 2005.

The Iranian Government has faced armed opposition from a number of groups, including the Mojahedin-e-Khalq or MEK (which the U.S. Government added to its list of Foreign Terrorist Organizations in 1999), the People's Fedayeen, and the Kurdish Democratic Party of Iran (KDPI).

The Iranian Government has faced armed opposition from a number of groups, including the Mojahedin-e-Khalq or MEK (which the U.S. Government added to its list of Foreign Terrorist Organizations in 1999), the People's Fedayeen, and the Kurdish Democratic Party of Iran (KDPI).

== ECONOMY ==

== ECONOMY ==

Pre-revolutionary Iran's economic development was rapid. Traditionally an agricultural society, by the 1970s Iran had achieved significant industrialization and economic modernization. However, the pace of growth had slowed dramatically by 1978, just before the Islamic revolution. Since the fall of the shah, economic recovery has proven elusive thanks to a combination of factors, including fluctuations in the global energy market. Economic activity was severely disrupted additionally by years of upheaval and uncertainty surrounding the revolution and the introduction of statist economic policies. These conditions were worsened by the war with Iraq and the decline in world oil prices beginning in late 1985. After the war with Iraq ended, the situation began to improve: Iran's GDP grew for two years running, partly from an oil windfall in 1990, and there was a substantial increase in imports. However, Iran had suffered a braindrain throughout the previous decade and wartime policies had resulted in a demographic explosion.

Pre-revolutionary Iran's economic development was rapid. Traditionally an agricultural society, by the 1970s Iran had achieved significant industrialization and economic modernization. However, the pace of growth had slowed dramatically by 1978, just before the Islamic revolution. Since the fall of the shah, economic recovery has proven elusive thanks to a combination of factors, including fluctuations in the global energy market. Economic activity was severely disrupted additionally by years of upheaval and uncertainty surrounding the revolution and the introduction of statist economic policies. These conditions were worsened by the war with Iraq and the decline in world oil prices beginning in late 1985. After the war with Iraq ended, the situation began to improve: Iran's GDP grew for two years running, partly from an oil windfall in 1990, and there was a substantial increase in imports. However, Iran had suffered a brain drain throughout the previous decade and wartime policies had resulted in a demographic explosion.

A decrease in oil revenues in 1991 and growing external debt dampened optimism for recovery. In March 1989, the government instituted a new five-year plan for economic development, which loosened state control and allowed Iran to seek greater latitude in accessing foreign capital. Mismanagement and inefficient bureaucracy, as well as political and ideological infighting, hampered the formulation and execution of a consolidated economic policy, and the Iran fell short of the plan’s goals while economic inequality was aggravated. Today, Iran's economy is a mixture of central planning, state ownership of oil and other large enterprises, village agriculture, and small-scale private trading and service ventures. Former President Khatami followed the market reform plans of his predecessor, President Rafsanjani, and indicated that he would pursue diversification of Iran's oil-reliant economy, although he made little progress toward that goal. High inflation and expansive public transfer programs, as well as powerful economic-political vested interests created obstacles for rapid reform.

A decrease in oil revenues in 1991 and growing external debt dampened optimism for recovery. In March 1989, the government instituted a new five-year plan for economic development, which loosened state control and allowed Iran to seek greater latitude in accessing foreign capital. Mismanagement and inefficient bureaucracy, as well as political and ideological infighting, hampered the formulation and execution of a consolidated economic policy, and the Iran fell short of the plan’s goals while economic inequality was aggravated. Today, Iran's economy is a mixture of central planning, state ownership of oil and other large enterprises, village agriculture, and small-scale private trading and service ventures. Former President Khatami followed the market reform plans of his predecessor, President Rafsanjani, and indicated that he would pursue diversification of Iran's oil-reliant economy, although he made little progress toward that goal. High inflation and expansive public transfer programs, as well as powerful economic-political vested interests created obstacles for rapid reform.

Iran maintains regular diplomatic and commercial relations with Russia and the former Soviet republics. Both Iran and Russia believe they have important national interests at stake in developments in Central Asia and the Transcaucasus, particularly regarding energy resources from the Caspian Sea. Russian and other sales of military equipment and technology to Iran concern Iran's neighbors and the United States. Washington is also concerned about Russian assistance in building at nuclear facility at Bushehr.

Iran maintains regular diplomatic and commercial relations with Russia and the former Soviet republics. Both Iran and Russia believe they have important national interests at stake in developments in Central Asia and the Transcaucasus, particularly regarding energy resources from the Caspian Sea. Russian and other sales of military equipment and technology to Iran concern Iran's neighbors and the United States. Washington is also concerned about Russian assistance in building at nuclear facility at Bushehr.

Iran spends about 3.3% of its GDP on its military. Iran’s military consists of both a national military held over from the shah’s government and the Revolutionary Guard Corps, each with its own ground, naval and air braches. The Iran-Iraq war took a heavy toll on these military forces. Iran is trying to modernize its military, including ballistic missile programs, and acquire weapons of mass destruction; it does not yet have, but continues to seek, nuclear capabilities.

Iran spends about 3.3% of its GDP on its military. Iran’s military consists of both a national military held over from the shah’s government and the Revolutionary Guard Corps, each with its own ground, naval and air branches. The Iran-Iraq war took a heavy toll on these military forces. Iran is trying to modernize its military, including ballistic missile programs, and acquire weapons of mass destruction; it does not yet have, but continues to seek, nuclear capabilities.

== U.S.-IRANIAN RELATIONS ==

== U.S.-IRANIAN RELATIONS ==

On November 4, 1979, militant Iranian students occupied the American Embassy in Tehran with the support of Ayatollah Khomeini. Fifty-two Americans were held hostage for 444 days. On April 7, 1980, the [[United States]] broke diplomatic relations with Iran, and on April 24, 1981, the Swiss Government assumed representation of U.S. interests in Tehran. Iranian interests in the United States are represented by the Government of Pakistan. The Islamic Republic of Iran does not have its own embassy in Washington, though it does have a permanent mission to the United Nations in New York City.

On November 4, 1979, militant Iranian students occupied the American Embassy in Tehran with the support of Ayatollah Khomeini. Fifty-two Americans were held hostage for 444 days. On April 7, 1980, the [[United States]] broke diplomatic relations with Iran, and on April 24, 1981, the Swiss Government assumed representation of U.S. interests in Tehran. Iranian interests in the United States are represented by the Government of [[Directory:Pakistan|Pakistan]]. The Islamic Republic of Iran does not have its own embassy in Washington, though it does have a permanent mission to the United Nations in New York City.

In accordance with the Algiers declaration of January 20, 1981, the Iran-U.S. Claims Tribunal (located in The Hague, Netherlands) was established for the purpose of handling claims of U.S. nationals against Iran and of Iranian nationals against the United States. U.S. contact with Iran through The Hague covers only legal matters.

In accordance with the Algiers declaration of January 20, 1981, the Iran-U.S. Claims Tribunal (located in The Hague, Netherlands) was established for the purpose of handling claims of U.S. nationals against Iran and of Iranian nationals against the United States. U.S. contact with Iran through The Hague covers only legal matters.

The U.S. Government, by Executive Orders issued by the President as well as by Congressional legislation, prohibits most trade with Iran. Some sanctions were imposed on Iran because Tehran is a state sponsor of terrorism, others because of the nuclear proliferation issues, and still more for human rights violations, including infringement of religious freedom. The commercial relations that do exists between the two countries consist mainly of Iranian purchases of food and medical products and U.S. imports of carpets and food. Some sanctions were temporarily waived in the wake of the devastating Bam earthquake of December 2003. U.S. officials and relief workers actively assisted in relief and reconstruction efforts.

The U.S. Government, by Executive Orders issued by the President as well as by Congressional legislation, prohibits most trade with Iran. Some sanctions were imposed on Iran because Tehran is a state sponsor of terrorism, others because of the nuclear proliferation issues, and still more for human rights violations, including infringement of religious freedom. The commercial relations that do exists between the two countries consist mainly of Iranian purchases of food and medical products and U.S. imports of carpets and food. Some sanctions were temporarily waived in the wake of the devastating Bam earthquake of December 2003. U.S. officials and relief workers actively assisted in relief and reconstruction efforts.

There are serious obstacles to improved relations between the two countries. As a state sponsor of terrorism, Iran remains an impediment to international efforts to locate and prosecute terrorists. Operation Iraqi Freedom removed the Iranian Government’s greatest security threat, but officially Iran remained neutral about U.S. policy, sometimes strongly condemning American policies and actions in Iraq. Iran has cultural ties to elements of the populations of both Iraq and Afghanistan. It has made some positive contributions to stability in both countries, but other actions have had the opposite effect. It remains to be seen whether Tehran will ultimately be a constructive force in the reconstruction of its two neighbors or not.

There are serious obstacles to improved relations between the two countries. As a state sponsor of terrorism, Iran remains an impediment to international efforts to locate and prosecute terrorists. Operation Iraqi Freedom removed the Iranian Government’s greatest security threat, but officially Iran remained neutral about U.S. policy, sometimes strongly condemning American policies and actions in [[Directory:Iraq|Iraq]]. Iran has cultural ties to elements of the populations of both Iraq and [[Directory:Afghanistan|Afghanistan]]. It has made some positive contributions to stability in both countries, but other actions have had the opposite effect. It remains to be seen whether Tehran will ultimately be a constructive force in the reconstruction of its two neighbors or not.

The U.S. Government defines its areas of objectionable Iranian behavior as the following:

The U.S. Government defines its areas of objectionable Iranian behavior as the following:

Iranian agreement to abide by UNSCR 1696, suspending uranium enrichment, would likely lead to the direct negotiations between American and Iranian government officials.

Iranian agreement to abide by UNSCR 1696, suspending uranium enrichment, would likely lead to the direct negotiations between American and Iranian government officials.

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