Speculation Mounts on Thaw in Israeli-Iranian Relations

By Patrick Goodenough | July 7, 2008 | 8:06 PM EDT

Jerusalem (CNS) - Iran has vociferously denied a report saying President Mohammed Khatami was seeking ways to improve relations with archenemy Israel, but some analysts believe the report to be true, and leaked purposely by the Israelis to send a warning to extremists in Tehran.

Jamshid Hassani, an exiled Iranian-born lawyer specializing in Iranian affairs, told CNSNews.com that there have been some signs of easing of tensions, and even collaboration, between the two countries, citing unconfirmed reports that Israeli engineers were involved in agricultural projects in Iran. However, Hassani was unable to confirm reports of back channel negotiations between the two nations.

Hassani also noted that several months ago, outgoing Foreign Minster Ariel Sharon had made an unprecedented offer to negotiate the repayment of a $750 million debt to Iran, outstanding since before the 1979 Islamic revolution. In return, Sharon said Israel would expect Iran to suspend its non-conventional weapons program and its support for terrorists fighting Israel.

Israel's respected Hebrew-language daily Ha'aretz, quoted senior British official this week as saying the Khatami administration had relayed proposed confidence-building steps to Israel, via the British, aimed at breaking "the current circle of distrust and suspicion."

They said Iran was anxious to quell Israeli fears about Iran's nonconventional weapons program, and that Tehran wanted Israel to know the weaponry was directed not at the Jewish state but at other regional countries perceived as threats, such as Iraq and Afghanistan.

Britain and Iran were quick to deny the report, which the Iranian foreign ministry called "futile efforts by the Zionist propaganda machinery" to undermine Khatami.

Deemed a "moderate," Khatami is understood to be engaged in a continuing power struggle with extremist clerics controlling parts of the state and security apparatus. Since his 1997 election, he has said he is seeking to improve relations with the West.

Israel and Iran are currently involved in a dispute over the fate of 13 Iranian Jews held on suspicion of spying for Israel and the United States. Some experts believe the arrests are part of a campaign by extremists to discredit Khatami.

The Texas-based intelligence firm Stratfor argued Tuesday that a decision to leak details of back channel negotiations may be intended to warn Iranian "hardliners" that Israel could if it wished disclose further and more embarrassing information about secret Israeli-Iranian dealings over the past two decades.

"The Ha'aretz article was a shot across the bow of any Iranian official who believed that Israel needs to conceal and maintain its secret links to Iran more than Iran needs to conceal and maintain those same links," Stratfor said. "Should Israel choose to publish a chronicle of back channel relations with Iran, there are a host of great Islamic revolutionaries who stand to lose a great deal."

The analysts conceded that leaking the alleged channel with Khatami effectively torpedoed it, but argued that "Khatami would only stand to gain should Israel choose to release a more complete expose, as it would not only sink his foes but also paint Iran historically in a more moderate light."

As early as the 1980s, Israel provided the weapons destined for Iran as part of the controversial "Iran-Contra" deal negotiated by U.S. officials to buy freedom for American hostages held by Iranian-backed terror groups in Lebanon.

Patrick Goodenough
Patrick Goodenough
Spencer Journalism Fellow