By Michael Jasinski
Russian assistance for the Iranian nuclear program has long been an irritant in the U.S.-Russian relations. The revelations concerning Iran's hitherto unknown uranium enrichment efforts, which propelled Iran's nuclear ambitions to the center of the world's attention, added a new dimension to the controversy. In a report released on June 18, 2003, the International Atomic Energy Agency (IAEA) criticized Iran for failing to report a number of nuclear activities. Nevertheless, the IAEA did not impose sanctions on Iran, though it did enjoin it to sign an additional protocol pursuant to its nuclear Non-Proliferation Treaty (NPT) obligations, which would enable the IAEA to inspect any suspected nuclear site in Iran, rather than just declared nuclear sites. These developments have signaled a new phase in the long U.S.-Russian dispute over Russia's nuclear projects in Iran.
Russia's most significant nuclear project in Iran is the construction of a nuclear power plant (NPP) at Bushehr. The project was started by the German company Siemens in the 1970s, which abandoned it during early stages of construction following the Islamic Revolution. Russia undertook to complete this project, after signing an agreement with Iran in January 1995. Although both Iran and Russia have issued numerous assurances that the reactor would be placed under IAEA safeguards and therefore it could not be used in the interests of a nuclear weapons program, the project has caused considerable concern about its proliferation risk. The concerns center on the possibility that the nuclear energy program might serve as a cover under which nuclear materials, technology, and equipment could be imported for use in a nuclear weapons program. There are also concerns that Iran might divert the spent fuel from the reactor into a weapons program.
The U.S. government has consistently called for the termination of Russian nuclear assistance to Iran. However, in spite of the pressure, which included both sanctions against institutions aiding Iran and offers of greater cooperation between Russia's Ministry of Atomic Energy (Minatom) and the U.S. Department of Energy (DOE), Russia has not stopped the construction of the reactor. Nevertheless, the scope of the Russian-Iranian cooperation has narrowed. Although so far the United States has not been successful in stopping the Bushehr project, U.S. efforts to dissuade Russia from assisting Iran in developing its nuclear industry in other areas appear to have had greater success. Although Iran reportedly did receive blueprints for a heavy-water research reactor, plans to construct a gas centrifuge in Iran have been cancelled. This fate was apparently also shared by projects to construct a light-water research reactor and a nuclear-power desalination plant. Furthermore, in March 2001, Minatom cancelled the sale of laser enrichment equipment to Iran, after the deal was criticized by the United States. While Minatom appears to be determined to see the Bushehr reactor completed, it is showing much less interest in assisting Iran in its fuel cycle development. Although the 1995 agreement on the Bushehr reactor also obligated Russia to deliver two thousand tons of natural uranium, that part of the agreement was probably cancelled. While there have been reports (denied by Minatom) that Iran obtained uranium mining and milling technology from Russia, these transfers (if they took place) most likely did not have official approval.  In March 2003, Minister of Atomic Energy Aleksandr Rumyantsev expressed concern about the reports of enrichment facilities in Iran. According to Rumyantsev, such facilities could endanger the Russia-Iran commercial partnership by enabling Iran to become independent of Russian nuclear fuel supplies.
Iran may also be interested in signing contracts with Minatom for the construction of additional power reactors, and even construction of more nuclear power stations. The construction of a second power unit at Bushehr may be a possibility. The second unit has already been the subject of discussions between Iranian and Russian officials, although it appears that no contracts will be issued prior to the completion of the first unit, at the earliest. 
Less clear are the prospects for the construction of additional reactors at sites other than Bushehr. Iran asked Minatom in 1998 to submit bids for the construction of three more power reactors. It is not clear whether the bids were ever submitted, however, and no contract was signed. The issue was raised once again in March 2001, when Iranian President Khatami mentioned the possibility of a second NPP, with two reactors. In July 2002, Minatom presented a 10-year assistance plan to Iran, which contained references to constructing five additional reactors in Iran, including three at Bushehr and two at the as-yet unbuilt Ahwaz NPP. However, Minatom representatives later characterized these plans as representing possible courses of action, and acknowledged that Iran had not requested the construction of additional reactors. Nevertheless, this announcement was in stark contrast with earlier Minatom statements that Russia's nuclear assistance to Iran would cease upon the completion of the Bushehr NPP.
One of the concerns about the Bushehr reactor has been the possibility that the spent fuel from the reactor could be used for extracting weapons-grade materials. Russia and Iran signed an agreement in August 1995 to supply nuclear fuel for the Bushehr plant. However, the original agreement apparently did not contain provisions for the return of spent fuel to Russia. Active negotiations on the spent fuel issue began in earnest in 2002, with Iran reportedly resisting Russia's insistence that spent fuel be returned. Although a preliminary agreement on spent fuel return was signed in December 2002, no final agreement was signed as of June 2003. In the meantime, and possibly as a result of the delay in negotiating the spent fuel return agreement, the first shipment of fuel for the Bushehr reactor, which was expected to take place in May 2003, has been postponed until 2004.
Missile Technology Assistance
Russian assistance to Iran in the area of missile technology has been less extensive than in the nuclear area. The Russian government has consistently insisted that no significant transfers of missile technology to Iran ever took place, and that it is adhering to its Missile Technology Control Regime (MTCR) obligations. It does acknowledge Iranian attempts to acquire such technologies, and that some Russian individuals may have been involved in Iranian missile projects. The greatest proliferation threat may be posed not by state-sanctioned transfers, but rather by activity by individual firms or scientists, possibly acting in concert with corrupt officials. The grave financial status of most Russian missile industry enterprises, combined with insufficiently vigilant enforcement of export control regulations, exacerbates the risk.
Rather than complete missile systems, most alleged leaks of technology involve guidance and propulsion systems and their components, high-strength steels and special alloys, as well as manufacturing and testing equipment. Specialists from two Russian defense firms are also known to have visited Iran, and Iranian students received training in missile technologies at Russian institutes. Seven Russian companies suffered U.S. government sanctions as a result of their ties to Iran.
Conclusion It is clear that although Russia continues to discount U.S. allegations of Iranian pursuit of nuclear weapons, its policy toward Iran has undergone some change. Whereas in the past Minatom officials expressed skepticism toward claims that Iran was attempting a domestic nuclear fuel cycle, the recently revealed information about Iranian enrichment activities forced a reevaluation of Iran's capabilities in that area. Russia, which in the past has been satisfied with the level of IAEA safeguards at Iranian nuclear facilities, has called on Iran to sign an additional protocol with the IAEA. After an apparent period of indecision and policy debate, Minister of Atomic Energy Rumyantsev said on June 20, 2003, that Russia would provide nuclear fuel for the Bushehr reactor only after Iran signed an additional protocol, a clear concession to the United States. Rumyantsev also stated that Russia would supply nuclear fuel only after Iran put under IAEA safeguards all of its nuclear facilities and fully satisfied all of IAEA's concerns. Although Russia continues to regard with skepticism claims of an Iranian nuclear weapons program and has framed its concerns about Iranian nuclear facilities in terms of harm that might be done to Russia's commercial interests, Rumyantsev's statement suggests that there exists a possibility for narrowing the gap between Russia and the United States. Although there are no signs Russia has become more willing to abandon the Bushehr project, its support for more stringent IAEA safeguards is a welcome development.
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I’m aware of all this ETL.