Iran

Baroness Afshar Excerpts

Thursday 24th October 2013 Grand Committee

Asked by

[Baroness Afshar]

To ask Her Majesty’s Government, in the light of the recent elections in Iran, what steps they are taking to facilitate closer commercial and educational ties with that country.

[Baroness Afshar (CB)]

My Lords, I am grateful for this opportunity to speak about the country where I was born, and I thank noble Lords who are participating in this debate and speaking. I would like to raise a few points before the negotiations between the countries start again, in the hope that they might be used as relevant points by the negotiators.

Negotiations between Iran and the six powers in Geneva seem to have been very optimistically received. The noble Baroness, Lady Ashton, the EU’s top foreign policy official, has described them as “substantive and forward-looking”. Iran’s top nuclear negotiator, Mohammad Javad Zarif, has spoken of the possibility of achieving a satisfactory outcome in the next six months. I add my voice to those of the educationalists and economists in the UK who have also welcomed this rapprochement. The UK in general, and the education sector in particular, would benefit from the easing of sanctions. This could be a win-win for all concerned, provided that there is understanding and appreciation of the difficulties on the way.

Education is one of the most effective means of building long-term trust among nations and individuals. It is hardly surprising that it is Ayatollah Rouhani, a graduate of Glasgow Caledonian University, who started the negotiations and secured a level of agreement from the spiritual leader of Iran. Students make a significant contribution economically, academically and intellectually, in terms of building understanding across divides that sometimes prove difficult to cross otherwise.

However, there is a real problem in the banking system as it stands and as it has operated in the decades since the imposition of sanctions. It has been a serious impediment. Students who have been offered places—who are more than willing to pay the fees and health taxes that might be imposed in the future and have the money ready—cannot find a bank in the UK willing to open an account for them. I know of students who have lived in Canada for more than 10 years but who, because they are Iranian, cannot even transmit money from Canada to the UK to start discussions. That seems to result in universities saying that their hands are tied because they cannot proceed with the processes. The University of Sheffield, for example, has been working in Iran and has offices there offering scholarships to Iranian students with exceptional academic potential. Many Iranians, particularly women, have such potential aplenty.

The difficulty is not only that the students cannot open accounts; a further problem is when those students who are already in this country and have accounts here go on fieldwork trips and come back, they find that they have to reopen the same accounts and provide the same information all over again. In the case of one of my students, who made two field trips, this had to be done twice.

These kinds of obstacles make students less willing to apply to British universities. The measures are highly counterproductive and the Government should come to the rescue of these students because, as we all know, most if not all British universities are heavily dependent on foreign student fees in order to bridge the gap created by the cuts. Last year, banking restrictions also resulted in Iran abandoning its conversion rate for foreign students, which gave favourable rates to students studying abroad, particularly in the UK. Now, it is much more expensive for Iranian students to raise the same fees in Iran.

Banking restrictions have also resulted in very serious medical problems in Iran because pharmaceutical companies cannot import the necessary ingredients for producing medication at affordable prices. This has resulted in the deaths of hundreds of people. Political prisoners have even written an open letter asking for the lifting of sanctions. They point out what I have pointed out in the House before: namely, that sanctions only make the rich richer and the poor poorer. It is not the rich who suffer from the sanctions—they get their medication, they come abroad for treatment—but those who are living in Iran. The situation is dire, which is another reason that Iranians are extremely keen to enter negotiations and for them to be successful.

The prospect of detente has already resulted in the freeing of a number of political prisoners: 11 were freed a month ago. They included Nasrin Sotoudeh, the campaigning human rights lawyer and winner of the European Parliament’s 2012 Sakharov Prize for Freedom of Thought, and the reformist politician Mohsen Aminzadeh. A week later, on the eve of President Rouhani’s visit to the USA, 80 more political prisoners were freed, some of whom had been jailed after the mass protests triggered by the fraud- tainted re-election of former President Ahmadinejad in 2009. Last week, more political prisoners were pardoned. The hope is that this process will continue and accelerate.

A rapprochement would be extremely beneficial to the UK. The Iranian economy has not died during this period. In fact, many projects have been set up, including mining, construction, chemical production, car manufacturing and packaging, and are thriving. But the sanctions have resulted in trade relations moving towards Russia and the East, rather than the West. In 2010 China became Iran’s largest trading partner. In 2011 trade between Dubai and Iran was valued at $13.6 billion. Last year Iran’s largest car maker agreed to send 10,000 cars per annum to Russia.

To circumvent the banking restriction, trading partners use hawala, a system of exchanging money without the money ever leaving the country. It is a system completely dependent on trust, in which the bank uses a country that trades favourably with both trading partners. The current favourite is Japan. The Iranian bank leaves money in a bank in Iran and Japan uses its debts to Iran to provide money in any currency to a trading partner on the other side. So trade has continued; it has not diminished. This could be a profit that the UK is missing.

I shall end by mentioning nuclear power and chemical weapons. I am no expert in these matters, but the facts that the Iranians are offering to keep only two nuclear programmes in Natanz and argue that they have no chemical weapons are worth considering. Iran was attacked with chemical weapons. The havoc that caused means that no Iranian would allow them to be used against anyone, not even their enemy.