Introduction

Iran's interest in nuclear technology dates back to the U.S. Atoms for Peace program. In the 1950s, the Shah initiated Iran's nuclear research program and developed an ambitious plan to produce 23,000MW from nuclear power by the end of the century. Early progress was not steady, and the nuclear program was stalled by the Islamic revolution in 1979, then the eight-year war with Iraq through most of the 1980s. The program was revived later in the decade, when strategic interests began to drive the nuclear program. Under the Khomeini regime, Iran's nuclear program steadily grew on all fronts and stages of the nuclear fuel cycle, with a particular emphasis on developing and strengthening indigenous capabilities.

Partly as a result of the shortcomings in the Nuclear Non-Proliferation Treaty (NPT) safeguards system—which allowed the rapid development of the Iraqi nuclear program in the 1970s and North Korea's in the 1990s to go largely undetected—and partly by assessing Iran's intentions, the international community and the International Atomic Energy Agency (IAEA) have increased their scrutiny of Iran's activities over the last several years. The most alarming developments were revealed in 2002-03, during which time Iran admitted to having construction plans for two enrichment facilities, a heavy water production plant, a fuel fabrication plant, and undertaken research into conversion and enrichment activities (including centrifuges and possibly lasers). On 19 August 2003, Iran began testing a ten-machine cascade at the Pilot Fuel Enrichment Plant at Natanz with uranium hexafluoride (UF6). (After announcing on 21 October 2003 that it would cooperate with the IAEA, Iran signed the Additional Protocol to the NPT on 18 December.) All Iran's research activities in the recent past undoubtedly contribute to the future development of a complete nuclear fuel cycle, which in turn would enable Iran to weaponize without relying on outside assistance.

Iran continued its voluntary suspension of enrichment until August of 2005, when nuclear activities resumed at the Isfahan Uranium Conversion Facility. Iran said resumption was due to the European Union's lack of inclusion of Iran's inalienable right to the nuclear fuel cycle, as guaranteed in the NPT, in the proposal for negotiations. The IAEA passed a resolution asking Iran to halt their nuclear program, but Tehran refused to, stating that the nuclear fuel cycle was its right as a member of the NPT. On 24 September 2005, the IAEA found Iran in non-compliance of the NPT. The resolution did not contain an explicit threat that Iran would be referred to the UN Security Council, but did leave the door open for future referral. Tehran does not believe there is any legal basis for referral to the UN Security council and believes the current drive by the United States as well as some European countries are political in nature.

History

Although Iran began developing its nuclear program in the 1950s, it was slow to progress until late in the 1960s, when the U.S.-supplied 5MW thermal research reactor (TRR) went online at the Tehran Nuclear Research Center (TNRC). In 1973, spurred by an influx of oil revenues, the Shah of Iran embarked on an ambitious goal of modernizing the country and building its image abroad. He did this by shifting the country's budgets toward the military and the newly established Atomic Energy Organization of Iran (AEOI). The Shah set his goal high: "...get, as soon as possible, 23,000MWe from nuclear power stations."[1] In 1968, Iran signed the NPT in an effort to speed up its negotiations for nuclear agreements, particularly with the United States. In 1970, the government ratified the NPT and its obligations went into force.

In the five years that followed, Iran concluded several contracts for the construction of nuclear plants and the supply of nuclear fuel: with the United States in 1974; Germany in 1976; and France in 1977. In 1976, Iran also purchased a stake in Eurodif's (the European consortium) Tricastin uranium enrichment plant in France and purchased a stake in the RTZ uranium mine in Rossing, Namibia. Also in 1976, the government signed a $700 million contract to purchase uranium yellowcake from South Africa and sent Iranian technicians abroad for training in nuclear sciences.

In addition to his grand plans for nuclear power, the Shah placed a great emphasis on establishing and developing a nuclear research program. Although the Shah had no specific plans to engage in research of uranium reprocessing or enrichment, the scientists at the AEOI's newly equipped TNRC were reportedly given great discretion regarding the nature and direction of experiments conducted. According to former head of AEOI, Akbar Etemad, the Shah's interest in nuclear technology did not involve military applications, in fact the Shah "considered it absurd, under the existing circumstances, to embark on anything else but a purely civilian program."[2]

However, according to recently revealed documents discovered in Tehran after the revolution, in the late 1970s Iran and Israel discussed a plan to modify Israel's surface-to-surface Jericho missiles for use by Iran—missiles that could be equipped with nuclear weapons. And, despite Akbar Etemad's beliefs, the Western intelligence community had long suspected that the Shah's nuclear scientists conducted research into military applications. Suspected activities at the TNRC include nuclear weapons design, plutonium extraction and laser-enrichment research. By the time of the Islamic Revolution in January 1979, Iran's nuclear program was considered one the most advanced in the Middle East.

In the immediate aftermath of the revolution, Iran's ambitious nuclear program fell apart due to the initial opposition by the Khomeini government to nuclear technology and because of the exodus of many of Iran's nuclear scientists. Additionally, the insufficiency of the existing electrical infrastructure and dwindling oil revenues contributed to the withdrawal of foreign suppliers from Iran and the abandonment of nuclear power agreements. Iran's only nuclear power plants in 1979 were the two plants under construction at Bushehr, under contract with Germany's Siemens. The weapons research side of Iran's nuclear activities seemed to have continued uninterrupted by the revolution, and received a major boost when a new nuclear research center opened at Isfahan in 1984.

From its inception, the revolutionary government was forced to face external challenges in addition to domestic instability. Invasion by Iraq and the loss of Iran's powerful ally, the United States, must have contributed to Iran's sense of political and military vulnerability. Eight years of war with Iraq, multiple bombings of the Bushehr reactor site, chemical attacks on its forces, missile strikes on its cities, and an overall drain on its resources would certainly have had a devastating effect on Iran. In addition to feeling threatened by Iraq's growing nuclear program, these attacks may explain why the Khomeini government ultimately resumed its efforts to continue Iran's nuclear power program and strengthen its existing nuclear research program—and ultimately to develop nuclear weapons.

As the Cold War ended, the strategic environment around Iran changed. After the 1979 hostage crisis at the U.S. embassy in Tehran, the United States withdrew its support from Iran, cut all nuclear cooperation agreements, and, in fact, supported Iraq during the war. China, North Korea, and, to a certain extent, Syria emerged as major suppliers of conventional arms to Iran. Help from China and North Korea, however, was not limited to conventional weaponry. By this time, Iran was shopping for a new bidder to complete the Bushehr project. The late 1980s saw a rise of several new potential exporters of nuclear assistance.

Pakistan and China signed long-term nuclear cooperation agreements with Iran in 1987 and 1990, respectively. Accords with both countries involved training personnel, and in the case of China, the accord included an agreement to provide Iran with a 27KW miniature neutron source reactor (MNSR) and two 300MW Qinshan power reactors. Western intelligence suspected that Pakistan, which many estimated had succeeded in manufacturing a nuclear bomb in 1986, provided Iran with nuclear assistance. Reports in Western press and leaks from Western government and intelligence sources indicated that Pakistan had trained Iranian scientists in plutonium extraction and possibly gas centrifuge enrichment research. Training was most likely carried out under the direction of Abdul Qadeer Khan, former director of the Engineering Research Laboratories, later renamed the Dr. A.Q. Khan Research Laboratories (Kahuta), where Pakistan's nuclear weapons research and enrichment takes place. A.Q. Khan is widely regarded as the father of Pakistan's nuclear bomb.

The Soviet Union, traditionally an ally of Iraq, had also indicated an interest in cooperating with Iran. In 1990, the Soviet Union and Iran began negotiating over the completion of the Bushehr reactors and the supply of additional nuclear plants. In January 1995, the Russian Federation formally announced that it would complete the construction of the Bushehr reactors and signed an agreement with Iran to build three additional reactors at the site. Since the signing of these agreements, the United States has continuously expressed its opposition to the Bushehr deal because of fears that the deal could provide Iran with knowledge and technology to support a nuclear weapons program. Despite many technical delays (misfit of original Siemens equipment with Russian technology) and efforts by the United States to stall the project, frequently by lobbying the Russia government for the cancellation of the deal, most notably during the Gore-Chernomyrdin Commission meetings, the facility is nearing completion.[3] Over the years, the United States has successfully blocked several of Iran's nuclear agreements, such as those with Argentina (uranium enrichment and heavy water production facilities), China (plutonium-producing research reactor, two power reactors and a uranium conversion plant), and Russia (heavy water production plant).

In 1995, it became evident that Iran may be pursuing nuclear weapons through another track: by procuring dual-use items from Western firms. The United States also learned that Iran and Russia concluded a secret protocol stipulating, among other things, construction of a gas centrifuge enrichment facility. The fear was that Iran might learn how to construct a similar clandestine facility and then produce weapons-grade uranium undetected. The United States then imposed extensive sanctions on Iran and successfully pressured Russia and other potential suppliers, mostly in Europe, to halt exports of sensitive dual-use nuclear technology to Iran, such as high-voltage switches that could trigger a nuclear weapon and specialized remote manipulators designed to handle heavy volumes of radioactive material and possibly intended for a uranium or plutonium reprocessing plant.

In mid-2002, a Paris-based opposition group, the National Council of Resistance of Iran (NCRI), revealed the existence of two previously unknown facilities—a uranium enrichment facility at Natanz and a heavy water production plant at Arak. Following the discovery of substantial reserves of uranium ore at Saghand, Yazd province, Iran announced that it was developing a nuclear power plan that would rely solely on indigenous resources. These two events greatly alarmed the Western intelligence community. An enrichment and heavy water production capability along with domestic resources of uranium would significantly contribute to the development of a closed nuclear fuel cycle in Iran.

Recent Developments and Current Status

Upon visiting suspected facilities in February 2003, and with new declarations by Iran, the International Atomic Energy Agency (IAEA) concluded that several sensitive technology facilities are either operational, under construction, or planned. The IAEA raised questions regarding possible enrichment activities at the workshops of the Kalaye Electric Company relating to production of centrifuge components. Additionally, Iran admitted to having imported from China 1.8 tons of nuclear material (UF6, UF4 and UO2) used to manufacture uranium metal, which is essential in weapons production. During its meetings with IAEA officials in August 2003, Iran for the first time provided evidence of its technical violations of the NPT by revealing that in the 1990s, it had carried out 113 uranium conversion experiments involving the production of uranium metal from imported UF4 and the production of UF4 from imported UO2, as well as laboratory-scale experiments in the 1980s involving the production of heavy water.

During the IAEA inspection in June 2003, environmental samples that were taken from chemical traps of the Pilot Fuel Enrichment Plant at Natanz revealed the presence of highly enriched uranium (HEU). Short of declaring Iran in violation of the NPT, the IAEA Director-General Mohamed El-Baradei stated, "Iran has failed to meet its obligations under its Safeguards Agreement"[4] and criticized Iran for not being transparent with the construction of its nuclear-related facilities and import of nuclear material. The IAEA Board of Governors has imposed on Iran a 31 October 2003 deadline to resolve all outstanding issues and to provide full and complete declaration of its nuclear material and nuclear activities, specifically Iran's enrichment program and past conversion experiments. It further called on Iran to suspend all enrichment activities and sign an Additional Protocol.[5]

In an effort to diffuse the tense relations between Iran and the IAEA and to preserve the sanctity of the nonproliferation regime, foreign ministers of Britain, France and Germany secured Iran's consent to cooperation with the IAEA ahead of the 31 October deadline. Faced with probability of sanctions and international isolation in case of noncompliance with the IAEA's demands, Iran announced on 21 October 2003 that it will cooperate with the IAEA with full transparency and disclosure, sign the Additional Protocol and commence its ratification procedures, and suspend all enrichment and reprocessing activities, albeit for an "interim period." And finally, on 18 December 2003, Iran signed the Additional Protocol to the NPT, thus allowing snap inspections of its nuclear facilities by the IAEA experts. Ali Akbar Salehi, the outgoing Iranian representative to the IAEA, signed on behalf of Iran, and Director-General El-Baradei signed for the IAEA.[6]

Iran appears to be dangerously close to developing an indigenous nuclear fuel cycle, which would in turn enable it to develop a nuclear bomb without much reliance on outside help. Comparison with the other nuclear axis member North Korea is tempting, but inappropriate. Iran is motivated by its aspirations for political, religious, and military leadership in the region, unlike North Korea, for whom mere survival appears to be the priority. Iran has traditionally felt insecure among its neighbors, first vis-à-vis Iraq, whom it considered its most immediate physical and ideological threat, and now that the Hussein regime is gone, the growing presence and influence of the United States. Additionally, the constant threat of Israel's nuclear arsenal, mostly perpetuated by Iran's technocrats, government officials and the pro-nuclear lobby, adds to Iran's perceived concerns and justifies it to the domestic audience the need to develop nuclear weapons.

Iran's progress toward nuclear weapons, though irreversible, might be hampered by a combined effort on three fronts. First, an unlikely but not impossible development would be an emergence of a domestic opposition to nuclear weapons, potentially within President Khatami's reformist government. A second front would come in the form of intense international pressure on states that are still in the position to help Iran perfect its knowledge and infrastructure—Russia, Pakistan, China, and North Korea. A third approach might be a regional effort on the part of Arab states to pressure Iran to abandon sensitive technology and questionable activities in favor of a weapons-free zone in the Middle East.

Since Iran signed the Additional Protocol on Nuclear Safeguards on 18 December 2003, the Protocol provided inspectors from the IAEA with greater access within Iran and the option to carry out intrusive inspections at Iran's nuclear facilities.[7] Subsequent IAEA inspections in Iran revealed a wealth of new information related to the development and scale of Iran's nuclear program. Iran is generally viewed as having been forthcoming and helpful to these IAEA efforts, although this cooperation has clearly not been absolute. Indeed, on 18 June 2004, IAEA board members voted to reprimand Iran for not providing the agency with more timely and comprehensive support. Specifically, Iran was rebuked for postponing IAEA visits to a number of locations related to Iran's P-2 centrifuge enrichment program, which had been scheduled to take place in March 2004.[8] The IAEA also criticized Iran's lack of forthrightness about its possession of P-2 design drawings and other related research, and information regarding its manufacturing and mechanical testing activities, all of which was omitted from Iran's 21 October 2003 declaration to the agency.[9] The IAEA called on Iran to "be proactive in taking all necessary steps on an urgent basis to resolve all outstanding issues", including those related to contamination by low-enriched uranium (LEU) and HEU, as well as the limited production of polonium-210 and plutonium.[10]

Concurrently, the United States along with some other IAEA board members has continued to maintain that Iran is pursuing an underground nuclear weapons program. And while this claim has not yet been substantiated by IAEA inspectors, proponents argue that Iran has violated the NPT and that the country's nuclear file should, in turn, be referred to the United Nations Security Council (UNSC) for its review. El-Baradei is, however, weary of pursuing such a hard line against Iran, as he fears that exerting too much pressure may cause Iran to opt out of the NPT altogether.[11] Responding to the barrage of critics who insist that Iran's illicit intentions are obvious, El-Baradei has pointed to the continued absence of a "smoking gun" and the fundamental shortcomings of attempts to concretely assess Iran's programmatic goals without such evidence. As he stated in July 2004, "We are not God. We cannot read intentions."[12] For its part, Iran continues to assert that it pursues a nuclear program with only peaceful applications, while El-Baradei is steadfast in his belief that the situation may be resolved diplomatically.[13] In addition, Rustnrcsia remains unequivocally opposed to United Nations' sanctions against Iran, especially given the absence of evidence to bolster claims about illicit activities. Russia has also supported Iran's disclosure efforts, despite Russian President Vladimir Putin's November 2003 charge that Iran acted in bad faith by failing to fully comply with IAEA inspections.[14]

In an effort to bring Iran into compliance with its international obligations, European representatives from Britain, France, and Germany, in cooperation with the IAEA, offered Iran nuclear and trade incentives in exchange for Iran's abandonment of nuclear aspirations. In mid-November, all parties agreed to an agreement reaffirming Iran's commitment to uphold its obligations under the NPT, yet recognizing its right to pursue nuclear technologies for peaceful purposes.

U.S. officials, dissatisfied with the agreement, continued to pressure the international community to pursue more stringent investigations of Iran's nuclear program. In late November, a CIA report revealed Iranian involvement with Pakistani nuclear scientist A.Q. Khan, and details regarding the nuclear assistance and technology he shared.

On 29 November 2004, the IAEA Board of Governors adopted a resolution regarding Iran, putting into effect the NPT Safeguards Agreement and forcing Iran to suspend all nuclear-related activities until an investigation takes place. Iranian government officials voluntarily agreed to the resolution, but repeatedly declared that Iran has no intention of completely abandoning its nuclear program as the agreement is temporary.

On 2 December 2004, IAEA inspectors sought access to two secret Iranian military sites where the main Iranian opposition group alleged nuclear activities have taken place: Parchin and Lavizan II. Intelligence data indicates explosives testing and the purchase of equipment that may be used for uranium enrichment.

In March 2005, Iran refused IAEA inspectors a second visit to Parchin, a military site suspected of nuclear activity, stating that another visit was not justified. This has hindered the atomic agency's ability to complete its investigation into Iran's centrifuge equipment and the source of nuclear contamination detected during earlier visits. Results of January inspections to five other nuclear sites revealed nothing suspicious.

Amid rising concerns about Iran's insistence on its right to enrich uranium and inwardly revised estimates of its ability to build a nuclear bomb, the possibility of Israeli and/or American plans to mount an attack on Iranian nuclear sites "a la Osirak" received extensive treatment in the press in the first few months of 2005. Officials from both nations denied the charges.

Concurrent with Iran's ongoing EU trio nuclear negotiations, Iranian nuclear official Ali Akbar Salehi asserted on 22 April 2005 that Iran's plan to achieve full mastery of the nuclear fuel cycle is "completely clear and irreversible." This ambition has elicited widespread international criticism. In a "message" to Iran, on 26 April the United States approved the sale to Israel of "bunker buster" bombs capable of penetrating Iran's underground nuclear facilities.

On 1 August 2005, Iran notified the IAEA of its decision to resume uranium conversion activities at its conversion facility at Esfahan. This decision to resume uranium conversion was seen as a breach of the November 2004 Paris Agreement that viewed Iran’s suspension of all uranium-related activities as a prerequisite for dialogue. This notification by Iran was followed by the IAEA Director General’s report to the Board of Governors in September 2005, confirming Iran’s resumption of uranium activities and describing new findings. The findings were in two major areas, one related to the origin of the low enriched uranium and highly-enriched uranium contamination found at various locations in Iran and the second, related to the issue of the P-1 and P-2 centrifuge program. The Director General’s report in September 2005 also used strong language, urging Iran to adopt greater transparency measures vis-à-vis their nuclear program. On 24 September 2005, the IAEA passed a resolution finding Iran in non-compliance as opposed to previous resolutions that merely affirmed a breach in obligations. The resolution passed with 21 votes of approval, 12 abstentions, and one opposing vote. Russia and China were among those that abstained from voting and Venezuela was the only country to vote against the resolution. The resolution stated that Iran's non-compliance due to "many failures and breaches" over nuclear safeguards of the NPT were grounds for referral to the UN Security Council.

The resolution passed on 24 September 2005, leaving the door open for future referral of Iran to the Security Council and was finally adopted in February 2006. On 4 February 2006, the 35-nation board of the IAEA voted to “report” Iran to the Security Council over its decision announced in January, to restart nuclear research. The above resolution passed with 27 votes of approval, 5 abstentions, and 3 opposing votes. This was the first time that Russia and China agreed to go along with the position of the EU-3 and the United States over Iran. However, Russia and China insisted on using the word “report” instead of “refer” in the text of the most recent IAEA resolution.  Iran has rejected the above resolution calling it, “illegal, illogical and politically motivated.” As a response to the most recent resolution, Iran has decided to scrap the “containment and surveillance measures” as defined under the 1997 Additional Protocol, limiting the intrusive powers of the inspectors and putting a halt to snap inspections as well. Iran has also resumed small scale enrichment activities at its Natanz facility as of February 16. In a parallel diplomatic process vis-à-vis a deal backed by the United States and the European Union, Russia continues to pursue negotiations with Iran that would allow Russia to host Iran’s uranium enrichment program leaving only the uranium conversion to be carried out on Iranian soil.

	Updated November 2006