Editor’s Note: The following article is based upon interviews conducted with Iranians living inside Iran, but written by an author outside the country. The names stated in the article are pseudonyms in order to protect the safety of those interviewed.

When Iranian state-run television was updating its viewers about the latest developments of the Occupy Wall Street movement, the EU embargoed Iran’s oil. Immediately, the rate of the Iranian currency fell; one US dollar was sold for 21,000 rials. In addition, each government- issued gold coin was sold for ten million rials. The average Iranian’s reaction to the unstable and chaotic market varied from panic to depression to anger.

Reza Javadi, a carpet seller says: “Everything is in a stagnant state. People are all afraid. You can feel the silent before a disaster about to happen. Until yesterday, I talked to people who used to say nothing has happened yet, but following the European Union’s oil sanctions, people are really afraid now.”

Negar Rouhi, author and translator, says: “Every day in my office I translate a lot of documents for university students who are racing each other to leave the country. These days, more than ever, I feel the sense of fear and distrust on their faces. They don’t want to believe that the currency crisis is serious. But with the EU sanctions, it is impossible for the price of U.S. dollar to decrease.”

Soheil, a 35- year-old supermarket owner in central Tehran, is worried about potential food shortages in the upcoming months. “The situation is hopeless. We are reverting back to the worst days of the Iran-Iraq war. I am worried everything will be rationed again. With Iran’s currency problems, the price of meat has already gone up. Given the irresponsibility of Ahmadinejad’s government, the situation will even become more dangerous.”

Zohreh Davari, a worker in a drug factory who makes $400 a month and has four children, says: “I am already feeling the shortages. I don’t care about the price of the U.S. dollar or gold. I have never bought foreign currency or gold. What makes me afraid is the food price increases. Even now with my salary, I can only afford food for my children until the middle of every month. If the prices go up and salaries stay the same, we will die.”

Where are Khamenei and Ahmadinejad?

Mansour, a 30-year-old living in Tehran is afraid and worried after receiving the news of the EU’s oil embargo. He says, “I want to know why Ahmadinejad, who always has something to say about any topic, is now silent? I am sure he is going to say that these sanctions have no impact on Iran’s economy. However, we saw today that just the news of sanctions caused the increase of prices on many products. The sanctions have not even been implemented yet. By the middle of July, these sanctions will cause us to run out of foreign exchange reserves, which will result in more serious pressure on the people. Khamenei should walk out of his house on Palestine Street and explain our fate to us in the coming days.”

Sajdeh Hosseini, a father in Tehran, has a daughter who suffers from multiple sclerosis. He is forced to spend $500 a month on medication, while his entire capital amounts to only $4,000. He says: “This is my question for Mr. Khamenei, why have you let a madman like Ahmadinejad waste the wealth of a nation? What if we become like Iraq and the Food- for- Oil program? What if medicine is sanctioned and we cannot produce medicine for the sick? What if there is a war?”

He continued: “With sanctions, poverty, and a government that knows nothing but force, the condition of our society will only get worse. We will witness more drug addicts, thieve, and depressed people in the country. I am very worried about the dark days ahead of the Iranian people. I know the regime will save its own political demise with the help of its friends, China and Russia. But, the people and the structure of the society will erode from within. At the end, no one will be held accountable just like in the days of the eight-year war and the years after.”

Iranian Facebook users from inside the country were absorbed with the news of the EU oil sanctions. Maryam, a senior student at the University of Tehran, writes about her fear of sanctions: “I am afraid that one day we will be in dire need for our most basic needs such as food and clothing. Taxis have already increased their fairs.”

Mona, who works at the Shahid Beheshti Hospital, wrote on her Facebook page: “Now, I know how the Seven Sleepers of Ephesus felt after they woke up and realized their money is worthless. The only difference is that they slept for 300 years, but we have that feeling every morning we wake up.”

Parvaneh Vahidmanesh is a journalist and researcher of Iran’s contemporary history. She often writes about human rights issues in Iran. Vahidmanesh left Iran in 2009. She currently works for Freedom House as a Program Officer in Washington DC.

Q: Obama recently signed the defense authorization bill that sanctions Iran’s central bank. What is the main impact on Iran’s economy and what part of the economy is affected the most?

A: When you impose sanctions, in this case sanctioning the central bank of Iran, its effectiveness depends on the follow through. How will the United States take action against anyone who deals with the central bank? This is an open question. Will the US in fact fine and sanction an entity that deals with the central bank of Iran? The answer depends on the country that defies this particular bill. If it is China, the US would be much more reluctant, but if it is a small country like Greece, yes, the US would be more likely to take action and thus make the sanction bite.

The main impact of these sanctions on Iran’s economy is the following: Basically what these sanctions do is make it very difficult for banks and other entities to deal with the Iranian central bank. The US is saying if you deal with the central bank of Iran we are going to impose fines on you, we are not going to let you come into the US market, and, of course, for most countries the US market is much more important than the Iranian market. So as a result most countries would be much more reluctant to deal with Iran. However, if they still decide to deal with Iran, they will have to hide it from the United States or they will tell Iran we will deal with you but on more preferable terms for us because of the attendant risk of a US fine.

So what this means practically is that when Iran receives monies for its oil and when it needs to issue letters of credit for its imports, these transactions will be more costly. If a country cannot pay Iran for its oil, it will say we can keep this money and do a barter deal and this will increase the cost of Iran’s imports (or reduce the value of its oil exports) and require more foreign exchange. The main impact is it will put more pressure on Iran’s foreign exchange both on the side of revenues and the side of expenditures and so it will squeeze Iran’s foreign exchange reserves. That will be the major effect.

Q: According to reports inside Iran, Iran’s currency has dropped 10 percent in a span of a day or two. What is the reason behind the sudden depreciation of the rial?

A: Let me back up a bit. If you look back over last two years, the rial has depreciated almost 100 percent. Iran is its own worst enemy. The main reason Iran is in this dire economic situation is Iran’s economic policies, which I should list. Iranian economic mismanagement is very sad. Iran does not have good economic institutions, such as the rule of law, to give people confidence to invest in Iran.

The Iranian government controls the markets, so that markets are not free, such as the labor market, financial markets and some of the goods markets. And also much of Iran’s GDP is controlled by the government and semi-government entities; for example, one of the major economic entities in Iran are the foundations, which basically undo some of the government’s economic policies. Corruption is pervasive throughout the economy. Also macroeconomic polices are inconsistent and inappropriate. The president wakes up in the morning and declares what the interest rate should be. You just cannot dictate interest rates because many things affect interest rates. Those things cannot be changed over night.

However, it is undeniable that sanctions have had an impact. These sanctions much more recently – the financial sanctions –have had an impact. I think the depreciation is worse than 10 percent. People are losing faith in the Iranian economy and in Iran’s ability to redeem rials for dollars. They want to take money out because of bad policies and sanctions. They realize that the rial could plunge much more and that they might not be able to get much for their rials. So it is the beginning of a financial panic, and when a financial panic starts the sky is the limit. I do not know where the Iranian rial will end up. No one can answer that question. What we have seen could be a blip in what may follow and the rial could go into a free fall.

Q: What is the reason for the government’s inaction in dealing with the currency depreciation? Is there a segment of the population, which benefits from the economic turmoil?

A: The classic way a government would try to stop the outflow of financial resources is to increase interest rates. But this has been tried in European countries and what you have to do is increase overnight interest rates dramatically to 40 or 50 percent and adopt other harsh policies to restore financial order. Iran cannot do that because this will increase all prices, especially of imports, overnight and people will panic more and it might in fact backfire both financially and politically.

Another point is that Iran is of course an Islamic country and it would look bad if interest rates were jacked up to 50 percent just to stop the outflow of funds. But as I said earlier, this could backfire for the government because the price of goods are going up, increasing inflation, fueling inflationary expectation and encouraging hoarding even more. I do not know if the government is capable of managing what may follow.

So, I believe Iran is at the beginning of a very difficult financial and economic cycle. Iran cannot say the sanctions are hurting and this is why they have turned it into another issue, which is the Strait of Hormuz. By its military rhetoric, the Ahmadinejad government is trying to divert attention from its economic failures and the effect of sanctions.

Q: What are the immediate economic challenges for the government in the next six months?

A: I think first and foremost inflation is going to pick up. Interest rates will go up whether the government likes it or not and there will be much more hoarding of imported goods that will be a hedge against further rial depreciation.

All these things are going to put further pressure on Iran’s foreign exchange reserves. Iran has to persuade Iranians living inside and abroad that the government has enough foreign exchange to redeem rials for dollars and they are going to keep the exchange rate within a certain rate. I am not sure if they are in a position to do that. Once the market loses faith in Iran’s central bank ability to be able to redeem rails for dollars, I have no idea where the exchange rate will go. I think the danger for Iran is that a truly financial panic will set in. Such panic may cause the exchange rate to change really dramatically every day. Exchange instability and depreciation of the rial will become Iran’s financial problem and this will in turn affect the real economy, adversely affecting economic activity for some years to come.

Q: Can Iran survive the sanctions?

A: Iran’s economic policies have been a mess for many years and you cannot achieve an economic turnaround overnight; it will take time. Iran needs fundamental economic reforms. The only way I see that it will get relief is if the sanctions are rescinded by the United States and if something occurs such as a country like China helps Iran out of its mess. In other words, a miracle! So I do not see any way Iran can avoid this short-run economic turmoil. There needs to be rational, fundamental reforms that they will stick to, which will in turn give the market confidence. It will take political courage and change economic policies. There is no quick fix.

Q: Do you think the overall policy of the United States sanctioning Iran has so far been successful?

A: From the Iranian perspective, and in fact from a humanitarian perspective, what happened during the Iran-Iraq war was wrong. It was a mistake for the United States and a number of European countries to support Iraq, especially with outlawed chemical weapons. Understandably, Iranians do not want to be so vulnerable again. This is why the Iranian people support the government’s policies to develop Iran’s nuclear capabilities. For sanctions to have a better chance of success, you want the broad citizenry to favor a change in the policy targeted by sanctions. The United States has made a mistake. It picked the wrong policy (to be changed by the regime in Tehran).

The nuclear issue is a popular policy. What the United States should say is we are going to impose sanctions until you hold free elections, respect human rights….This would have much force within Iran and with a change in regime, then the nuclear issue could be better resolved. The issue the US has picked (the nuclear issue) will not rally the people against the regime. Sanctions are aimed at hurting the government and forcing the regime to change its policies, or squeezing the average citizen to turn against the regime. It hurts the average person. This is sad, but inevitable, fallout of sanctions that cannot be helped.

Q: How significant were the protests at the British embassy? Do they mark a new chapter in hostilities between Iran and the West?

A: Without a doubt this is a new chapter in escalation of tensions between Iran and Britain and between Iran and the European Union. The Iranian Parliament recognized the key role Britain plays in the European Union and realized that the remarks coming from London are very different compared with the more passive remarks from other European countries such as the Netherlands and Italy.

Understanding Britain’s pivotal role, the Iranian regime decided to first begin its opposition . I only believe it is a show, they passed a bill in the Parliament to reduce diplomatic ties with Britain to the level of charge d’affaires. As part of the same approach, they also physically attacked the embassy and the British residential compound.

Without a doubt these actions will result in the escalation of tensions between Iran, Britain and European Union.

Q: Were these protests orchestrated by the regime?

A: I don’t have a doubt in mind that yesterday’s actions were designed in advance. I can bring up many other examples of similar attacks on other foreign embassies in Tehran. Many years ago, there were attacks on the Embassy of Saudi Arabia, which resulted in the death of Saudi diplomat who fell off the roof.

There have been attacks on the Embassy of Netherlands due to the remarks made by an official from the country. There were similar attacks on the Embassy of Morocco. There have been numerous cases of such attacks. The best example to make the case that such attacks have the government’s backing is the hostage crisis at the United States’ embassy. Some so-called students attacked the U.S Embassy, but the highest political official in Iran, the Supreme Leader, supported that attack. The U.S diplomats were held captive for 444 days. If that incident was supported by the government, then without a doubt, yesterday’s incident was also supported by the government.

I would never believe that the Iranian security forces who had the power to crackdown on millions of street protesters in 2009 are now incapable of stopping a few hundred people from entering the British embassy. Therefore, I believe there was a hidden agenda to drive this action. I am pretty sure that the attackers were not students. They are the same pressure groups that oppress the opposition forces within the country.

Q: Do you think the Iranian regime is more extremist today than a few years ago?

A: Obviously the recent bill passed in the Parliament, yesterday’s incident, and other messages coming from Iran, lead us to believe that the Islamic Republic has decided not to take a single step back. The Iranian government wants to maintain the status quo, and in order to achieve this goal it will use every possible means available to it.

The storming of the embassy would have never happened without the approval of senior regime officials. Therefore, the regime’s decision is to deal with any country that puts pressure on Iran by all means necessary. We should even expect to witness the further radicalization of the Iranian government.

It would not be out of the realm of possibilities for Iran to even use its connections in Europe to plan a sabotage attack even inside Europe.

Q: Do you think this is in response to a perception that Iran will soon be attacked military by the US or Israel?

No, I don’t believe so. The military strike was not seriously considered as an option against Iran. The Iranian government has not taken these threats seriously. The Iranian government believes it is capable of responding, on a limited basis to any military strike. The Iranian regime is not like Saddam’s regime or Qaddafi’s regime, which were completely unable to retaliate.

Iran has proven it has some missile capability. They can easily promote instability in the region. They know the military option is on the table, but it is not the first priority of the Western governments. So, I do not see a direct connection between the Embassy events and the military threats. I do however see a connection between these events and the increase of pressures through sanctions.

These events happened after the British government announced they will be sanctioning Iran’s Central Bank. This is an attempt by the British government to cut the vital artery of the Iranian regime.

Q: What should be the response from the US and Great Britain?

I believe the speed of discussions about Iran between Britain and its allies will increase. Yesterday’s events will be bitter for Britain, but at the same time it demonstrated to them that they have found Iran’s most venerable point. Iran’s vital artery is its Central Bank.

I believe if Britain would have only imposed economic sanctions on Iran, without sanctioning the banks, the response from Iran would have not been so hostile. In a sense, this is feedback on how effective these sanctions really are. So, they will more than likely continue to take advantage of Iran’s venerable point.

More than likely, sanctioning of Iran’s Central Bank will become the first priority on the list of other Western governments.

Since the 1979 Islamic Revolution in Iran, one of the greatest failures of the country’s leadership has been the inability to make a promised transition from a monarchy to republican rule. In fact, since Ayatollah Ali Khamenei began his tenure as Supreme Leader twenty-two years ago, he has centralized power further in his own hands, creating what can be called a clerical monarchy.

Now, Khamenei may be completing the circle and entirely eliminating any notion of a “republic” by turning Iran into a fully blown theocratic and authoritarian state.

Last month, Khamenei made a short statement, which has sparked an intense debate. The 72-year-old Iranian leader hinted at the possibility of dissolving the post of president, one of only two institutions in which the populace has a say.

During a visit to Kermanshah, a western Iranian province, Khamenei announced, “In the country’s current political system, there is a president who is directly elected by the people. This is a good and an effective method. However, if someday in the distant future, it is decided that the parliamentary system is a better way to elect the head of the executive branch, there is nothing wrong with changing the current mechanism.”

So why has the Supreme Leader decided to suggest eliminating the position of the presidency in Iran? What does he have to gain from this dramatic political shift? The most obvious explanation is his determination not to repeat the disputed 2009 election and its aftermath. Elections in Iran historically have offered the population rare opportunities to express their grievances with the regime. The protests in 2009 and 2010, which drew millions of Iranians to the streets, not only seriously threatened Khamenei’s ability to govern, but exposed his unpopularity.

In recent years, beginning with the victorious election in 1997 of Mohammad Khatami to the presidency – an outcome conservatives and hardliners did not expect or want – the regime has faced a dilemma over whether the benefits of elections outweigh the costs. The presidential and parliamentary elections – the two polls in which a sizeable number of the electorate are allowed to participate – provide a façade that the country is somewhat of a republic, even though a body called the Guardian Council vets candidates long before voters ever get to the polls.

But the 2009 election and its aftermath inspired a poplar rebellion unprecedented in Iran’s post-revolutionary history. And now that uprisings have swept the Arab world, it is not surprising that Khamenei is so worried about public reaction to Iran’s scheduled 2013 presidential poll that he prefers to eliminate it entirely.

In addition, electoral seasons in Iran inspire some degree of euphoria within society. It is often a time of lively public debate over politics, women’s limited rights in Iran, the economy and Iran’s place in the world, which generally produces widespread criticism of the regime. Khamenei might believe now that the regime is too weak to withstand such intense public scrutiny.

Should Khamenei eliminate the post of president and instead create a parliamentary system, the power to govern would be even more concentrated in the office of the Supreme Leader and this has been Khamenei’s long-term objective.

In recent years, he has moved to acquire influence over three central branches of government. He effectively controls the judicial branch of the government by personally choosing its head. He maintains control over the legislative branch through the supervisory power given to the Guardian Council. This council consists of 12 jurists who determine the compatibility with the Shari’a (Islamic law) with the laws passed by the Parliament. If the laws do not pass the necessary requirements, the Council refers them back to the Parliament for revision. This effective veto power gives the council the de facto role of a parliamentary upper chamber. Six individuals on this 12-member body are directly elected by the Supreme Leader and the other half by the parliament from the jurists nominated by the head of the judiciary.

Khamenei will further control the legislative branch with the recent approval of the “Parliamentary Supervision over Members of Parliament” bill. On Tuesday, September 27, the Iranian Parliament approved Article 4 of the “Parliamentary Supervision over Members of Parliament” bill, which specifies a method for Parliament to expel certain MPs from the body. Based on one of the provisions in this bill, if the Council of Supervision votes to expel a certain member, he or she is not able to file a legal objection through the judicial system. The bill completely removes the legal immunity of members of the parliament in fulfilling their role as representatives.

This provides Khamenei or his aides with the ability to eliminate any parliamentary member deemed to be a trouble maker. By eliminating the position of the presidency, the Supreme Leader effectively dissolves a semi-independent branch of the government whose head is directly chosen by the people, after the Guardian Council vets the candidates seeking to run in the election.

It appears that discussion about eliminating the position of the president has been underway for a few months. According to Fars News, a semi-official news agency, a powerful deputy in the parliament, Mohammad Dehghan, revealed that the office of the Supreme Leader had assigned a group of legal experts to study the feasibility of a shift in the political structure of the country.

According to Dehghan, “This team has studied tens of articles in the constitution and they have identified some issues.” Dehghan reiterated that this team has been functioning under the supervision of the Office of the Supreme Leader and their findings have been sent to that office. Dehghan is referring to the constitutional articles related to the executive branch of the government.

There are many regime insiders who are worried about the future identity of the Islamic Republic. According to Aftab News, on October 25, Akbar Hashemi Rafsanjani, the Head of the Expediency Council, protested the possibility of eliminating the presidency in Iran. He warned that the decision will further restrict the political environment and cautioned that this decision would “be contrary to the Constitution and would weaken the people’s power of choice.”

According to Rafsanjani’s official website, “Republicanism and Islamism are the two unalterable elements of the Islamic Republic,” and changing these pillars will ultimately alter the nature of the regime.

Grand Ayatollah Mousavi Ardabili, an important marja’ (source of emulation for Shiite Muslims) who is close to Iran’s opposition movement, also criticized such a possible move. In a meeting with a group of journalists, the Grand Ayatollah said, “Changing the political system and selecting the president [or prime minister] by the parliament will decrease people’s participation [in the national affairs of the state].”

Whether or not Khamenei decides to eliminate the presidency, there is little doubt he will continue to consolidate more power in his office. These days, the words of the late Grand Ayatollah Ali Montazeri ring more true than ever. Following the regime’s intense crackdown on political opposition in 2009, Montazeri declared that “The Islamic Republic is neither Islamic nor a Republic.”

Q: The IAEA says Iran is now significantly closer to weaponizaton and has nuclear capability. Should the regime decide to pursue this option? Do you agree with this assessment?

A: The last IAEA report clarifies certain aspects of the Iranian nuclear puzzle. The Agency tried to re-organize the information collected since 2002, using the latest data to define a wider and more consistent picture of Iran’s efforts to acquire nuclear capability. The section C. (1-12) of the Annex to the report analyzes the activities in each step of the weaponization process with a systematic perspective. Indeed, its focus is to identify possible connections between indicators of different stages of weaponization.

Much of the information was already known by international community, and what is new is the tone of the report and the details that were divulged. This is why the Iranians tried to prevent the IAEA report from being published. From this point of view, the relevance of this document is not assessing whether Iran is significantly closer to weaponization, but to demonstrate that the IAEA is closer to reconstructing Iran’s nuclear activities, even without Iran’s full cooperation. This aspect is quite important and could influence future political decisions by the Iranian regime about its nuclear capability.

Q: What evidence in the IAEA report do you find most compelling regarding Iran’s nuclear capability?

A: Considering the issues regarding the structure of program management, the procurement activities and the nuclear material acquisition, the more detailed documentation is related to the AMAD plan for weaponization, which was directed by Mohsen Fakhrizadeh until 2003. Clearly, the evidence stems from many years of analysis and cross verification undertaken by the IAEA of the so-called Alleged Studies.

The Alleged Studies referred to studies allegedly conducted by Iran on three technical areas connected to weaponization activities: the green salt project; high explosives and re-engineering of the payload chamber of the Shahab 3 missile re-entry vehicle. While the bulk of this information was already contained in previous IAEA reports, this is not the case for many interesting findings reported in Section C of the Annex of the latest report. In particular, there is new information related to the high-explosive initiation systems and hydrodynamic experiments. This information raises well-founded concerns about the military nature of the Iranian program. As a matter of fact, although enrichment is a dual-purpose activity, the above mentioned research and evidence make a non-nuclear purpose program less believable.

In general, considering Iran’s diffidence and criticism about the last IAEA reports, the Agency has been very meticulous in examining carefully and critically all the information in its possession. The “credibility of the information” is assessed in a specific part of the document (section B. of the Annex) in which the IAEA gave further indication about the consistency of the findings and on the different sources of the information.

Q: The report also indicates that Iran has relied upon foreign materials to develop its program. Do you believe this is accurate?

A: It is well-known that Teheran has received, overtly and secretly, materials, equipment and blueprints to develop its nuclear program from different countries. In this regard, the last IAEA report gives some new information stating that in 2007 a member of the clandestine A.Q Khan nuclear supply network told the Agency that Iran was supplied with nuclear explosive design information, far more detailed than that provided to Libya by the same Pakistani network. But no further details on this issue are given.

Instead, more accurate information is reported on the alleged cooperation between Teheran and a foreign expert in the field of high explosives initiation system that worked for much of his career on this technology in the nuclear weapon program. The name and the nationality of this man is not reported in the document, but different sources, even inside the IAEA, believe it is the former Soviet nuclear scientist, Vycheslav V. Danilenko. Information obtained from direct interviews between the IAEA and this scientist suggest that he worked in Iran from 1996 to 2002. If true, this would be the first confirmation, after years of speculation, of secret cooperation between the Iranian regime and a former soviet nuclear scientist in the immediate years after the collapse of the USSR. Obviously, it does not indicate the existence of Russian government collaboration: due to the chaotic situation of the former-Soviet Republics, many military experts and scientists accepted foreign offers.

Q: The IAEA report states that Iran’s program is far more ambitious and advanced than was believed to be the case. Do you agree with this assessment? In what ways it is ambitious and advanced?

A: For long time, the Iranian nuclear program has been far more ambitious than advanced, but in the last few years it seems this balance has changed. Indeed, the ambition has always been one of the main drivers for the nuclear program of both the Shah’s monarchy and the Islamic Republic, strictly connected to the leading role that Iranians want to play in the international system

From a certain point of view, the initial pressure from the international community on Tehran for halting is nuclear program backfired, because Iran considers its nuclear program a matter of “national pride” and “national independence”. This semi-ideological posture has sustained the difficult but steady advancement of the entire Iranian nuclear program, which has finally reached a critical complexity and an advanced status.

It is not clear yet if Iran’s intention is to reach real break-out capability or to reach full military nuclear capability.

Q: Some have said the report offer little that is new, but it is the most comprehensive and detailed assessment of the Iran’s program. Do you agree or do you think the report breaks new ground?

A: We think this report breaks new ground in the sense that it has changed the relationship between the IAEA and Iran. With the help of different EU member states, the IAEA succeeded in collecting and re-organizing information regarding many outstanding issues of Iran’s nuclear program without the full cooperation of Tehran. This fact could be considered an improvement in the investigation capabilities of the IAEA and an erosion of Iran’s bargaining power. In this sense it is very important to prevent a further deterioration of the relation between IAEA and Iran, which could definitively spawn dangerous tensions.

Q: The IAEA says Iran is now significantly closer to weaponizaton and has nuclear capability. Should the regime decide to pursue this option? Do you agree with this assessment?

A: The IAEA report cites evidence that points to nuclear weapon R&D. This, along with the growth of enriched uranium stockpiles and progress in its ballistic missiles program, demonstrates that Iran wants the ability to produce a nuclear device. It makes it hard to believe that Iran’s program is for civilian purposes.

But the information in the report is not new. Some national intelligence organisations have known about these activities for a while now, but the IAEA had been cautious to release their findings publically until they were verified.

Nowhere in the report does it say that Iran has a nuclear weapon, or is currently making one, which is why we must be cautious in calling for action immediately.

Q: What evidence in the IAEA report do you find most compelling regarding Iran’s nuclear capability?

A: The piece of information that has attracted the most attention is Iran’s R&D efforts in weaponizaton. But there are actually two other significant points in this report. Firstly, the fact that it was released under the auspices of the IAEA, giving the information contained extra credibility in the eyes of the international community. Secondly, it is the aggregate weight of the information rather than the individual parts that demonstrates Iranian intent. As previously mentioned, it is Iran’s R&D into weaponizaton coupled with its advancing missile program, continued enrichment and the secrecy surrounding its nuclear activities that provides compelling evidence of Iran’s intentions.

Q: The report also indicates that Iran has relied upon foreign materials to develop its program. Do you believe this is accurate?

A: This is one of the most interesting aspects of the report. In its report, the IAEA outlined that a former Soviet scientist and nuclear weapons expert spent some time in Iran and allegedly assisted them in their program. In addition, following an interview with a member of the AQ Khan network, the agency explained that Iran had received bomb designs from the network, including more advanced designs than those sold to Libya in the past. The report also outlines assistance received by other nuclear-weapon states. It is this kind of activity that the sanctions regimes target.

At the moment, Iran has a certain amount of technology, which it either developed by itself, or received outside assistance with. Given Iran’s technological limitations, it is reasonable to concur with the IAEA report. In addition, given the amount of political pressure it was under, the IAEA would not have released this information if it were not sure of its accuracy. According to the report, the intelligence came from multiple sources, and not just Western intelligence sources but information that the IAEA developed on its own, including the information about Iran’s procurement, and black market networks.

Q: The IAEA report states that Iran’s program is far more ambitious and advanced than was believed to be the case. Do you agree with this assessment? In what ways it is ambitious and advanced?

The IAEA report represents the most complete outline of Iran’s nuclear capabilities that government and UN agencies have been prepared to confirm publicly, but it is roughly in line with expectations in the nuclear-security community.

The latest IAEA report confirms that Iran’s program is ambitious and has progressed considerably. But it is important to highlight that up until now, Iran has not made the decision to go nuclear. Its progression has been relatively slow, especially when compared with Pakistan’s crash program. In addition, Iran’s program has been the target of sanctions and sabotage efforts (assassinations, Stuxnet, industrial sabotage) that have further prevented it from advancing as fast as regime heads may have wanted it to advance.

It is also important to highlight Iranian’s perseverance with its nuclear program. No matter what the international community has thrown their way, Iran has declared its commitment to continuing its “peaceful” program. In fact, just this week, in response to the release of the IAEA report, President Ahmadinejad stated that Iran would not “retreat one iota” from its nuclear ambitions.

Q: The IAEA says Iran is now significantly closer to weaponizaton and has nuclear capability. Should the regime decide to pursue this option? Do you agree with this assessment?

A: The fact that Iran is seeking nuclear latency has been well-known to the intelligence and non-proliferation communities for a long time. Both the 2007 U.S. National Intelligence Estimate and the 2009 IAEA report stated, “Iran has the scientific, technical and industrial capacity eventually to produce nuclear weapons, if it decides to do so.” For one thing, the new IAEA reports shows that Iran’s progress on nuclear arms experiments has been much milder than alarmists claim. The new IAEA report clearly demonstrates that since 2003 weaponization efforts have become dispersed and are pursued with diminished vigor.

The report contends that the information package Iran received from A.Q. Khan’s illicit nuclear network was more sophisticated than the starter kit that Libya obtained from the same supplier. Nevertheless, the agency does not claim that Iran has been able to master this technology. The IAEA simply highlights Iran’s research and development efforts, which does not readily translate to actual weaponization. Therefore, there is still time for diplomacy to resolving the Iranian nuclear issue. In 2003, the Europeans convinced Iran through diplomacy to admit to its past wrongdoings. The goal should now be to revitalize the diplomatic engagement process and provide Tehran with guarantees that it will not be penalized if it comes clean of its past activities and cooperates with the IAEA. The same approach was successfully employed in the case of Libya.

Q: What evidence in the IAEA report do you find most compelling regarding Iran’s nuclear capability?

A: I think, much like the hype and the fallout surrounding the release of iPhone 4S, the new IAEA report failed to surprise. The report is unprecedented in the scale and scope of the detailed information that it has revealed to the public eye, but contains no new information. Since the agency had pierced Iran’s cloak of nuclear secrecy numerous times in the past, most of the information in the 12-page annex of this report was referenced to previous IAEA publications. Moreover, the report has failed to scrap the word “possible” from the often-used construct “possible military dimension” of Iran’s nuclear program; at best it has rendered the word “probable,” more diplomatically relevant. Nonetheless, evidence on the possibility of ongoing nuclear arms experiments is extremely thin and mostly based on information received from one or two unnamed sources. The agency also does not make a compelling case when it gets to dual-use technologies that could be use for non-nuclear arm related experiments. This part of the report requires more scrutiny from the experts; as for example the exploding bridge-wire detonators have many civilian applications contrary to what the IAEA contends.

For more substance, see page 8 of the annex:

The information indicates that prior to the end of 2003 the above activities took place under a structured program. There are also some indications that some activities relevant to the development of a nuclear explosive device continued after 2003, and that some may still be ongoing.

Q: The report also indicates that Iran has relied upon foreign materials to develop its program. Do you believe this is accurate?

A: Almost all nuclear weapon states benefited from external assistance to develop their atomic arms. Israel enjoyed the US support, while India used American and Canadian technology to obtain the ultimate weapon. Soviet Union aided China in getting the atomic bomb, and in turn helped Pakistan to develop its nuclear weapons program. The fact that Iran has had extensive ties with Russia, Pakistan and North Korea to develop its nuclear program has been public knowledge for a long time. The exact nature of these relations, however, is still opaque, despite the IAEA’s effort to shed more light on it. The new IAEA report is thus not a game-changer.

Q: The IAEA report states that Iran’s program is far more ambitious and advanced than was believed to be the case. Do you agree with this assessment? In what ways it is ambitious and advanced?

A: The Iranian nuclear program is extensive, ambitious and advanced; but it is not a crash program towards nuclear weapons. In fact, the new IAEA report reveals that the pace of Iranian uranium refinement has continued to stagnate. Iran’s antiquated IR-1 machines continue to underperform and five years after Ahmadinejad promised to deploy a new generation of indigenous centrifuges, Iran has yet to set up a complete cascade of them. Yet, the fact that Iran has been willing to pay such a huge price for a program that has virtually no economic rational and energy benefits increases concerns about Iran’s true intentions. Iran’s only reactor in Bushehr merely provides less than two percent of the country’s energy needs, which pales in comparison to 18 percent waste in Iran’s electrical transmission lines.

The lack of factual evidence in the alleged assassination plot tied to Iran has resulted in a state of uncertainty among average Iranians. People in the streets, shopping centers, and taxi cabs are constantly talking about the assassination plot and based on their own knowledge of world affairs, they try to develop scenarios which would explain this accusation.

Three of the more popular and consistent scenarios presented by the people are the following:

First scenario: All this media frenzy is simply another lie constructed by the United States. Using the assassination plot, America is attempting to increase the speed in which Iran is further isolated from the world and the Middle East. It is also an attempt to make it that much more difficult for Iran to establish a relationship with Saudi Arabia.

Second scenario: Some individuals assume that the Israeli intelligence services are also involved in creating this fabrication in order to spark disputes in the region and distract the world from the Palestinian call for statehood.

Third scenario: Since Ahmadinejad’s recent trip to the United Nations, some unofficial sources indicate that members of his delegation held some meetings with intermediaries and U.S. lobbies in New York. The regime in Iran is very reluctant with the establishment of such a relationship and is after disturbing any potential connection between Ahmadinejad’s government and America. Therefore, by hatching this plot, it is trying to create a crisis situation and take the power out of the hands of Ahmadinejad’s camp.

Nevertheless, people are still questioning the validity of this accusation and there are alarming potential consequences.

First of all, the way this allegation was presented by the American media is perceived to be so rushed and unpolished that few people in Tehran’s streets believe the story. Accusing Iran of such charges, without presenting adequate proof to the public, reminds the average Iranian of the accusations carried out by the Iranian government towards its own critics.

The next issue is the United States’ bad history regarding the announcement of such news. Many individuals in Iran are reminded of fabrications of the Gulf of Tonkin incident with Vietnam, WMDs in Iraq, and other false intelligence accounts. The United States has paid a heavy price for its history of faulty intelligence, but it is one of the most important reasons behind the average Iranian’s doubt.

Also, Iran has a closer and more equipped playing field for creating any potential crisis. Iran can use its influence in Bahrain, Syria, Lebanon, and Palestine for opposing the United States, so the location of the alleged assassination plot has also been a cause for hesitation among Iranian analysts and average citizens. Iran’s ability to exert its influence in the countries of the region has been tested in the past, especially during the thirty-three war in Lebanon, when Iran showcased its power by supporting Hezbollah.

However, the main concern for the average Iranian is the consequences of this issue. Regardless of the country or individuals responsible for the assassination plot, the potential disaster that could be caused will not be small for the Iranian people.

Many people believe that this is a new excuse for imposing more sanctions on Iran. These sanctions will further impact people’s poor economic conditions. Iran is already faced with high unemployment and inflation rates and any additional sanctions will simply make the everyday lives of the Iranians harder.

Many Iranians still believe that after the military occupation of Iraq and Afghanistan, Iran is the next target. Iranians are very aware of individuals who are pushing for a military option inside the U.S. government. However, these hawks need an excuse to turn public opinion against Iran.

Either way, because of the presence of a foreign enemy, it is likely that the Iranian people will be forced to back their government. Perhaps the need for such unity is the reason that the Supreme Leader continuously warns the Iranian people about the threat of foreign adversaries.

A look at the past demonstrates that whenever the Iranian government is faced with challenges in the international arena, the Iranian people are the ones that pay the price. There are plenty of examples including the hundreds of thousands of Iranians killed during the Iran-Iraq War.

No matter what the nature of the alleged plot to assassinate the Saudi ambassador may be, what is obvious to the Iranian people is that it will bring them nothing more than new problems, tougher conditions, fear, and anxiety.

Residing in Tehran, Iran, Emad Peyvandi is a labor activist and journalist.

According to this piece of legislation, a committee comprised of representatives from security and propaganda agencies, such as the Ministry of Intelligence, the Organization of Islamic Propaganda, the Basij, and the Islamic Revolutionary Guards Corps will be responsible for monitoring and supervising civil society institutions and their activities. Therefore, the fates of NGOs and civil society in Iran will be entirely in the hands of the government’s coercive apparatus.

A number of international organizations such as Amnesty International have asked members of the Iranian parliament not to pass the bill. They warned that the new law would be the last nail in the coffin of Iranian civil society and NGOs.

A large portion of Iranian NGOs were established during the years of reformist President Mohammad Khatami. After the election of President Mahmoud Ahmadinejad in 2005, NGOs in Iran faced new challenges, and their existence was threatened. Some government officials claim that there are more than 3,000 NGOs in Iran, but independent observers and international organizations do not accept this estimate.

Hamid-Reza, who is active at an environmental NGO in Tehran, says, “Since Ahmadinejad came to power in 2005, independent civil society and NGOs went into coma. Many organizations ceased their operations because of increased harassment by the government. Activists in human rights and civic NGOs were threatened. It is not possible to provide accurate data on the number of NGOs destroyed since 2005, but the situation has become much worse.” According to this environmental activist, if the current bill becomes law, then talking about NGOs in Iran will be irrelevant in the future since there will be no NGOs left.

The government’s intentions for establishing an ideological committee led by security forces to monitor NGO activities in Iran is clear. Iranian officials accused NGOs of leading the way in the so-called “soft revolution” in Iran, especially after the demonstrations to protest the disputed 2009 presidential election. Since then, many activists were harassed, arrested, trialed, and incarcerated. For instance, the Center for Defenders of Human Rights, an organization founded by Nobel laureate Shirin Ebadi, and the Association for Defending Prisoners’ Rights, led by Emadeddin Baghi, can be mentioned as NGOs on the government’s black list. Ebadi was forced to leave Iran and Baghi is serving a six-year prison sentence.

According to observers, the current bill in the parliament is the result of government’s success in oppressing independent organizations in the past two years. A new analysis issued by an NGO in Amsterdam called, “Arseh Sevvom” concludes that: “The government is putting to use what it learned in crushing Iranian civil society and NGOs following the June 2009 election. The government wants to put security forces in charge of NGOs.”

In addition to putting security and intelligence forces in charge of NGOs, the aforementioned bill prohibits NGOs from criticizing political institutions in Iran or even from getting involved in political activities. The bill specifies that an NGO is only allowed to have a gathering once approved by the monitoring committee. The bill also specifies that interactions between Iranian NGOs and international organizations are strictly prohibited. Iranians are not even allowed to seek membership in foreign institutions. Participation in any international conference or event is only possible after the committee has run a thorough investigation and has granted its approval.

Stopping NGOs in Iran is not the only aim of the current bill. This bill is designed to replace NGOs with governmental organizations loyal to the current regime. The ideological committee in charge of monitoring NGOs in Iran will only grant permission of activity to those organizations that are aligned with the ideological goals of the government and the security forces. Government funding will only be provided to organizations that are approved by the committee and only members of sanctioned organizations are allowed to attend international conferences and events.

Alireza Afshar, Interior Ministry’s deputy minister for Social Affairs, told a number of NGOs last September that the basij forces and the IRGC have repeatedly stated that the root cause of the unrest in Iran were civil societies and NGOs. So this bill will allow the government and the security forces to do away with unwanted NGOs once and for all and create new NGOs, all of which will be linked to the government.

Fereshteh Farahmand, a member of a children’s rights organization in Tehran, says: “International organizations and bodies must react cleverly to the government’s move. Event organizers must do great research to find out who is invited to their conferences and events and to make sure that the invitees are really from NGOs and not sent by the government.” She believes that, “Inviting those linked to the government to participate in international events is a great insult to Iran’s civil society activists, especially at a time when so many activists are in jail.”

Ashkan Parsa is the pseudonym for an Iranian journalist who left Iran less than five months ago.