New freight train connections usually only have a limited potential to make global headlines, but a new service launched from China on Thursday could be different. Its cargo - 1,150 tons of sunflower seeds - may appears unremarkable, but its destination, however, is far more interesting: Tehran, the capital of Iran.
- US has been urging foreign companies to wind down operations in Iran
- But China appears to be doing the opposite
- The freight train connection launch is only the latest measure by Beijing
The launch of a new rail connection between Bayannur in China's Inner Mongolia Autonomous Region and Iran was announced by the official news agency Xinhua on Thursday. Its exact path was not described in the dispatch, but travel times will apparently be shortened by at least 20 days in comparison to cargo shipping. The sunflower seeds are now expected to arrive in Tehran in about two weeks.
While the seeds are making their steady progress across Asia, there's a growing risk of Iran and Israel breaking into open conflict in the meantime. French President Emmanuel Macron has already predicted that the U.S. decision to pull out of the Iran deal would lead to war, especially after Iranian Foreign Minister Mohammad Javad Zarif warned that the country may restart its nuclear program if U.S. sanctions are imposed. Iranian rocket attacks on Wednesday and the subsequent Israeli retaliatory attacks on Thursday indicated how quickly the situation could indeed escalate.
While the United States is now urging foreign companies to wind down their operations in Iran, China appears to be doing the opposite. Thursday's freight train connection launch was only the latest measure Beijing has taken to intensify trade relations with Iran and there seem to be no plans so far to give in to U.S. demands.
During a press briefing on Wednesday, Chinese Foreign Ministry spokesman Geng Shuang said that Iran and China would "maintain normal economic ties and trade."
"We will continue with our normal and transparent practical cooperation with Iran on the basis of not violating our international obligations," he said. China faces the same problem U.S. allies in Europe are currently facing: Even if European governments are opposed to new sanctions on Iran, European companies would have to abide by those rules or risk severe fines by the United States.
Even though they have expressed their outrage, some high-ranking European officials have already acknowledged that they would have few options to rein in the United States if it decided to punish European companies for continuing to trade with Iran.
China, however, appears more defiant.
When asked whether China would order its companies to withdraw from Iran to avoid U.S. sanctions, the Chinese Foreign Ministry spokesman indicated that Beijing might defy the Trump administration. "I want to stress that the Chinese government is opposed to the imposition of unilateral sanctions and the so-called long-arm jurisdiction by any country in accordance with its domestic laws," he said.
China has to some extent managed to circumvent U.S. sanctions in the past and may be able to do the same again this time. Some analysts have even suggested that Chinese entities could act as intermediaries for European companies that want to continue trading with Iran, but fear violating U.S. sanctions. Such sanctions would be particularly damaging to European businesses operating in the United States, such as plane manufacturer Airbus.
Speaking to CNBC, former U.S. diplomat Carlos Pascual said that oil sales from Iran via China or Russia to the rest of the world could circumvent U.S. measures.
"It's those types of leakages from Russia and China that are the most obvious ones where the Iranians could still find outlets to be able to export their product," he said.
Iranian exports to the European Union increased by 375 percent from 2015 to 2016, and European companies have already invested a significant amount of money in Iran, raising the stakes of any decision that could result in the deal's collapse.
China also has an interest in upholding its trade ties with Iran. Tehran sells more to China than to any other country and celebrated a 25 percent increase in exports there last year. The value of Chinese exports to Iran also increased by over 20 percent.
With Europe potentially turning to Chinese know-how to circumvent U.S. sanctions, the United States might find that the country being isolated in this situation is not Iran after all, but itself.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)