August 24, 2006

Iran has replaced America as the most influential foreign power inside Iraq, seizing an opportunity created by the war against terrorism, a report says.

The turmoil unleashed by the invasion of Iraq gave Teheran the chance to fill the void left by Saddam Hussein's downfall, says the survey from the Royal Institute of International Affairs, in London.

It says that Iran has bought influence by sponsoring parties representing the Shia majority, about 60 per cent of the population. By manipulating these allies, it has "superseded the US as the most influential power there".

The report adds: "There is little doubt that Iran has been the chief beneficiary of the war on terrorism in the Middle East."

All the leading Shia politicians in Iraq, notably Moqtada al-Sadr, the radical cleric, have close links with Iran. The largest Shia militias - Sadr's Mahdi army and the Badr brigades attached to the Supreme Council of Islamic Revolution in Iraq - receive arms, cash and possibly volunteers from Iran.

The report says that, if President George W Bush sanctioned military strikes against Iran's nuclear facilities, Teheran would probably sow chaos inside Iraq, leaving British forces in the largely Shia south in a particularly "perilous" position.

It says that when America and Britain toppled Saddam after overthrowing the Taliban - Sunni Muslim extremists bitterly opposed to Teheran's Shia ayatollahs - in Afghanistan, they played into Iran's hands by destroying its two leading rivals. Instead of establishing itself firmly on each side of Iran, America became bogged down in Iraq.

The new confidence of the Islamic republic, symbolised by the rhetoric of President Mahmoud Ahmadinejad, has made reaching a compromise on its pursuit of nuclear technology far harder, the report says. Soaring international oil prices have also filled its coffers. The report says that all this makes Iran strong enough to ignore western blandishments and press ahead with its nuclear programme.

But it says the balance of power inside the regime is unstable. Ayatollah Ali Khamenei, the supreme leader, has ultimate control of the nuclear programme. Mr Ahmadinejad is thought to exercise little direct power over it and his relations with Khamenei are strained.