Tuesday, July 19, 2011

DTN News - MIDDLE EAST DEFENSE NEWS: The U.S.-Saudi Dilemma: Iran's Reshaping Of Persian Gulf Politics

Asian Defense News: DTN News - MIDDLE EAST DEFENSE NEWS: The U.S.-Saudi Dilemma: Iran's Reshaping Of Persian Gulf Politics
(NSI News Source Info) Toronto, Canada - July 19, 2011: Something extraordinary, albeit not unexpected, is happening in the Persian Gulf region. The United States, lacking a coherent strategy to deal with Iran and too distracted to develop one, is struggling to navigate Iraq’s fractious political landscape in search of a deal that would allow Washington to keep a meaningful military presence in the country beyond the end-of-2011 deadline stipulated by the current Status of Forces Agreement. At the same time, Saudi Arabia, dubious of U.S. capabilities and intentions toward Iran, appears to be inching reluctantly toward an accommodation with its Persian adversary.

Iran clearly stands to gain from this dynamic in the short term as it seeks to reshape the balance of power in the world's most active energy arteries

But Iranian power is neither deep nor absolute. Instead, Tehran finds itself racing against a timetable that hinges not only on the U.S. ability to shift its attention from its ongoing wars in the Middle East but also on Turkey’s ability to grow into its historic regional role.

The Iranian Position

Iranian Defense Minister Ahmad Vahidi said something last week that caught our attention. Speaking at Iran’s first Strategic Naval Conference in Tehran on July 13, Vahidi said the United States is “making endeavors to drive a wedge between regional countries with the aim of preventing the establishment of an indigenized security arrangement in the region, but those attempts are rooted in misanalyses and will not succeed.” The effect Vahidi spoke of refers to the Iranian redefinition of Persian Gulf power dynamics, one that in Iran’s ideal world ultimately would transform the local political, business, military and religious affairs of the Gulf states to favor the Shia and their patrons in Iran.

From Iran’s point of view, this is a natural evolution, and one worth waiting centuries for. It would see power concentrated among the Shia in Mesopotamia, eastern Arabia and the Levant at the expense of the Sunnis who have dominated this land since the 16th century, when the Safavid Empire lost Iraq to the Ottomans. Ironically, Iran owes its thanks for this historic opportunity to its two main adversaries — the Wahhabi Sunnis of al Qaeda who carried out the 9/11 attacks and the “Great Satan” that brought down Saddam Hussein. Should Iran succeed in filling a major power void in Iraq, a country that touches six Middle Eastern powers and demographically favors the Shia, Iran would theoretically have its western flank secured as well as an oil-rich outlet with which to further project its influence.

So far, Iran’s plan is on track. Unless the United States permanently can station substantial military forces in the region, Iran replaces the United States as the most powerful military force in the Persian Gulf region. In particular, Iran has the military ability to threaten the Strait of Hormuz and has a clandestine network of operatives spread across the region. Through its deep penetration of the Iraqi government, Iran is also in the best position to influence Iraqi decision-making. Washington’s obvious struggle in trying to negotiate an extension of the U.S. deployment in Iraq is perhaps one of the clearest illustrations of Iranian resolve to secure its western flank. The Iranian nuclear issue, as we have long argued, is largely a sideshow; a nuclear deterrent, if actually achieved, would certainly enhance Iranian security, but themost immediate imperative for Iran is to consolidate its position in Iraq. And as this weekend’s Iranian incursion into northern Iraq — ostensibly to fight Kurdish militants — shows, Iran is willing to make measured, periodic shows of force to convey that message.

While Iran already is well on its way to accomplishing its goals in Iraq, it needs two other key pieces to complete Tehran’s picture of a regional “indigenized security arrangement” that Vahidi spoke of. The first is an understanding with its main military challenger in the region, the United States. Such an understanding would entail everything from ensuring Iraqi Sunni military impotence to expanding Iranian energy rights beyond its borders to placing limits on U.S. military activity in the region, all in return for the guaranteed flow of oil through the Strait of Hormuz and an Iranian pledge to stay clear of Saudi oil fields.

The second piece is an understanding with its main regional adversary, Saudi Arabia. Iran’s reshaping of Persian Gulf politics entails convincing its Sunni neighbors that resisting Iran is not worth the cost, especially when the United States does not seem to have the time or the resources to come to their aid at present. No matter how much money the Saudis throw at Western defense contractors, any military threat by the Saudi-led Gulf Cooperation Council states against Iran will be hollow without an active U.S. military commitment. Iran’s goal, therefore, is to coerce the major Sunni powers into recognizing an expanded Iranian sphere of influence at a time when U.S. security guarantees in the region are starting to erode.

Of course, there is always a gap between intent and capability, especially in the Iranian case. Both negotiating tracks are charged with distrust, and meaningful progress is by no means guaranteed. That said, a number of signals have surfaced in recent weeks leading us to examine the potential for a Saudi-Iranian accommodation, however brief that may be.

The Saudi Position

Not surprisingly, Saudi Arabia is greatly unnerved by the political evolution in Iraq. The Saudis increasingly will rely on regional powers such as Turkey in trying to maintain a Sunni bulwark against Iran in Iraq, but Riyadh has largely resigned itself to the idea that Iraq, for now, is in Tehran’s hands. This is an uncomfortable reality for the Saudi royals to cope with, but what is amplifying Saudi Arabia’s concerns in the region right now — and apparently nudging Riyadh toward the negotiating table with Tehran — is the current situation in Bahrain.

When Shiite-led protests erupted in Bahrain in the spring, we did not view the demonstrations simply as a natural outgrowth of the so-called Arab Spring. There were certainly overlapping factors, but there was little hiding the fact that Iran had seized an opportunity to pose a nightmare scenario for the Saudi royals: an Iranian-backed Shiite uprising spreading from the isles of Bahrain to the Shiite-concentrated, oil-rich Eastern Province of the Saudi kingdom.

This explains Saudi Arabia’s hasty response to the Bahraini unrest, during which it led a rare military intervention of GCC forces in Bahrain at the invitation of Manama to stymie a broader Iranian destabilization campaign. The demonstrations in Bahrain are far calmer now than they were in mid-March at the peak of the crisis, but the concerns of the GCC states have not subsided, and for good reason. Halfhearted attempts at national dialogues aside, Shiite dissent in this part of the region is likely to endure, and this is a reality that Iran can exploit in the long term through its developing covert capabilities.

When we saw in late June that Saudi Arabia was willingly drawing down its military presence in Bahrain at the same time the Iranians were putting out feelers in the local press on an almost daily basis regarding negotiations with Riyadh, we discovered through our sources that the pieces were beginning to fall into place for Saudi-Iranian negotiations. To understand why, we have to examine the Saudi perception of the current U.S. position in the region.

The Saudis cannot fully trust U.S. intentions at this point. The U.S. position in Iraq is tenuous at best, and Riyadh cannot rule out the possibility of Washington entering its own accommodation with Iran and thus leaving Saudi Arabia in the lurch. The United States has three basic interests: to maintain the flow of oil through the Strait of Hormuz, to reduce drastically the number of forces it has devoted to fighting wars with Sunni Islamist militants (who are also by definition at war with Iran), and to try to reconstruct a balance of power in the region that ultimately prevents any one state — whether Arab or Persian — from controlling all the oil in the Persian Gulf. The U.S. position in this regard is flexible, and while developing an understanding with Iran is a trying process, nothing fundamentally binds the United States to Saudi Arabia. If the United States comes to the conclusion that it does not have any good options in the near term for dealing with Iran, a U.S.-Iranian accommodation — however jarring on the surface — is not out of the question.

More immediately, the main point of negotiation between the United States and Iran is the status of U.S. forces in Iraq. Iran would prefer to see U.S. troops completely removed from its western flank, but it has already seen dramatic reductions. The question for both sides moving forward concerns not only the size but also the disposition and orientation of those remaining forces and the question of how rapidly they can be reoriented from a more vulnerable residual advisory and assistance role to a blocking force against Iran. It also must take into account how inherently vulnerable a U.S. military presence in Iraq (not to mention the remaining diplomatic presence) is to Iranian conventional and unconventional means.

The United States may be willing to recognize Iranian demands when it comes to Iran’s designs for the Iraqi government or oil concessions in the Shiite south, but it also wants to ensure that Iran does not try to overstep its bounds and threaten Saudi Arabia’s oil wealth. To reinforce a potential accommodation with Iran, the United States needs to maintain a blocking force against Iran, and this is where the U.S.-Iranian negotiation appears to be deadlocked.

The threat of a double-cross is a real one for all sides to this conflict. Iran cannot trust that the United States, once freed up, will not engage in military action against Iran down the line. The Americans cannot trust that the Iranians will not make a bid for Saudi Arabia’s oil wealth (though the military logistics required for such a move are likely beyond Iran’s capabilities at this point). Finally, the Saudis can’t trust that the United States will defend it in a time of need, especially if the United States is preoccupied with other matters and/or has developed a relationship with Iran that it feels the need to maintain.

When all this is taken together — the threat illustrated by Shiite unrest in Bahrain, the tenuous U.S. position in Iraq and the potential for Washington to strike its own deal with Tehran — Riyadh may be seeing little choice but to search out a truce with Iran, at least until it can get a clearer sense of U.S. intentions. This does not mean that the Saudis would place more trust in a relationship with their historical rivals, the Persians, than they would in a relationship with the United States. Saudi-Iranian animosity is embedded in a deep history of political, religious and economic competition between the two main powerhouses of the Persian Gulf, and it is not going to vanish with the scratch of a pen and a handshake. Instead, this would be a truce driven by short-term, tactical constraints. Such a truce would primarily aim to arrest Iranian covert activity linked to Shiite dissidents in the GCC states, giving the Sunni monarchist regimes a temporary sense of relief while they continue their efforts in trying to build up an Arab resistance to Iran.

But Iran would view such a preliminary understanding as the path toward a broader accommodation, one that would bestow recognition on Iran as the pre-eminent power of the Persian Gulf. Iran can thus be expected to make a variety of demands, all revolving around the idea of Sunni recognition of an expanded Iranian sphere of influence — a very difficult idea for Saudi Arabia to swallow.

This is where things get especially complicated. The United States theoretically might strike an accommodation with Iran, but it would do so only with the knowledge that it could rely on the traditional Sunni heavyweights in the region eventually to rebuild a relative balance of power. If the major Sunni powers reach their own accommodation with Iran, independent of the United States, the U.S. position in the region becomes all the more questionable. What would be the limits of a Saudi-Iranian negotiation? Could the United States ensure, for example, that Saudi Arabia would not bargain away U.S. military installations in a negotiation with Iran?

The Iranian defense minister broached this very idea during his speech last week when he said, “the United States has failed to establish a sustainable security system in the Persian Gulf region, and it is not possible that many vessels will maintain a permanent presence in the region.” Vahidi was seeking to convey to fellow Iranians and trying to convince the Sunni Arab powers that a U.S. security guarantee in the region does not hold as much weight as it used to, and that with Iran now filling the void, the United States may well face a much more difficult time trying to maintain its existing military installations.

The question that naturally arises from Vahidi’s statement is the future status of the U.S. Navy’s 5th Fleet in Bahrain, and whether Iran can instill just the right amount of fear in the minds of its Arab neighbors to shake the foundations of the U.S. military presence in the region. For now, Iran does not appear to have the military clout to threaten the GCC states to the point of forcing them to negotiate away their U.S. security guarantees in exchange for Iranian restraint. This is a threat, however, that Iran will continue to let slip and even one that Saudi Arabia quietly could use to capture Washington’s attention in the hopes of reinforcing U.S. support for the Sunni Arabs against Iran.

The Long-Term Scenario

The current dynamic places Iran in a prime position. Its political investment is paying off in Iraq, and it is positioning itself for negotiation with both the Saudis and the Americans that it hopes will fill out the contours of Iran’s regional sphere of influence. But Iranian power is not that durable in the long term.

Iran is well endowed with energy resources, but it is populous and mountainous. The cost of internal development means that while Iran can get by economically, it cannot prosper like many of its Arab competitors. Add to that a troubling demographic profile in which ethnic Persians constitute only a little more than half of the country’s population and developing challenges to the clerical establishment, and Iran clearly has a great deal going on internally distracting it from opportunities abroad.

The long-term regional picture also is not in Iran’s favor. Unlike Iran, Turkey is an ascendant country with the deep military, economic and political power to influence events in the Middle East — all under a Sunni banner that fits more naturally with the region’s religious landscape. Turkey also is the historical, indigenous check on Persian power. Though it will take time for Turkey to return to this role, strong hints of this dynamic already are coming to light.

In Iraq, Turkish influence can be felt across the political, business, security and cultural spheres as Ankara is working quietly and fastidiously to maintain a Sunni bulwark in the country and steep Turkish influence in the Arab world. And in Syria, though the Alawite regime led by the al Assads is not at a breakpoint, there is no doubt a confrontation building between Iran and Turkey over the future of the Syrian state. Turkey has an interest in building up a viable Sunni political force in Syria that can eventually displace the Alawites, while Iran has every interest in preserving the current regime so as to maintain a strategic foothold in the Levant.

For now, the Turks are not looking for a confrontation with Iran, nor are they necessarily ready for one. Regional forces are accelerating Turkey’s rise, but it will take experience and additional pressures for Turkey to translate rhetoric into action when it comes to meaningful power projection. This is yet another factor that is likely driving the Saudis to enter their own dialogue with Iran at this time.

The Iranians are thus in a race against time. It may be a matter of a few short years before the United States frees up its attention span and is able to re-examine the power dynamics in the Persian Gulf with fresh vigor. Within that time, we would also expect Turkey to come into its own and assume its role as the region’s natural counterbalance to Iran. By then, the Iranians hope to have the structures and agreements in place to hold their ground against the prevailing regional forces, but that level of long-term security depends on Tehran’s ability to cut its way through two very thorny sets of negotiations with the Saudis and the Americans while it still has the upper hand.



Read more: The U.S.-Saudi Dilemma: Iran's Reshaping of Persian Gulf Politics | STRATFOR



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DTN News - ISRAELI DEFENSE NEWS: IDF Doesn’t View Rocket Attacks As Real Escalation

Asian Defense News: DTN News - ISRAELI DEFENSE NEWS: IDF Doesn’t View Rocket Attacks As Real Escalation
**Analysis: Intelligence estimates that Hamas, Islamic Jihad have more than 10,000 rockets, missiles, a large stockpile that can reach Tel Aviv.
(NSI News Source Info) TORONTO, Canada - July 19, 2011: Despite the continued rocket fire from the Gaza Strip, the IDF does not appear to be preparing for a large-scale operation, such as Operation Cast Lead in 2009.

The understanding in the defense establishment is that the approximately 20 rockets that landed in Israel since last week have been fired by radical Islamic groups affiliated with al-Qaida and global jihad, made up of former Hamas operatives.

“The groups are blowing off steam,” one defense official said on Sunday after three more rockets hit Israel on Saturday night. “We are not viewing this as a real escalation.”

This can be understood by reviewing the IDF’s response so far to the rocket fire. While 20 rockets in a week is definitely a significant increase compared to the usual drizzle – in June for example four were fired into Israel and in May just one - the IDF is not responding the way it did during the last escalation in April.

There are three main reasons.

First, Hamas is not directly involved in the rocket fire like it was in April, when in one weekend it fired more than 120 rockets into Israel. This, however, does not clear Hamas of responsibility since Israel believes that if the terror group wanted to, it could stop the other factions from firing.

The second reason is that no one has been hurt from the rocket attacks, unlike the escalation in April, which started with the anti-tank missile attack on a school bus that killed 16-year-old Daniel Viflic.

The third reason is that, for the time being, neither Israel nor Hamas appear to be interested in a new large-scale operation. Hamas prefers the quiet so it can continue its unprecedented military buildup, and Israel, like in previous cases, is doing what it can to postpone the conflict for as long as possible and until there is no longer an alternative.

One of the main problems with Gaza today is that any future Israeli operation would likely have to be dramatically different than it was in 2009.

Then, the main strategy was to separate the southern part of the Gaza Strip from the North, to cut off arms supplies to northern Gaza – the location of most of the rocket launchers – and to hit Hamas infrastructure hard from the air throughout the Strip.

Today, Military Intelligence estimates Hamas and Islamic Jihad have obtained more than 10,000 rockets and missiles – including a large stockpile of Iranian Fajr-5 rockets that can reach Tel Aviv – close to what Hezbollah had on the eve of the Second Lebanon War in 2006. A year ago, the terror groups were believed to have just a few thousands rockets, but the revolution in Egypt has completely altered the balance of power between Israel and Gaza.

Practically speaking, this buildup has major operational ramifications for the IDF and means Palestinian terror groups now store their rockets and launchers throughout the region. In order to effectively stop rocket fire into Beersheba, Ashdod, Ashkelon and Tel Aviv, the IDF will have to operate throughout the entire Strip.

Israel is extremely concerned by the major increase in weapons and explosives smuggling into Gaza since Hosni Mubarak’s downfall in February. Already in April, The Jerusalem Post reported one of the first results of the revolution was the interim government’s decision to stop construction of a steel barrier that Egypt had been building along its border with Gaza in an effort to curb smuggling.

Instead, since the revolution, the IDF believes Hamas has smuggled in three times the amount of explosives it brought into Gaza in all of 2010. This is in addition to unprecedented amounts of anti-aircraft missiles and guided anti-tank missiles, like the Russian-made Kornet that hit the school bus three months ago.

Israel understands Egypt’s relationship with Hamas has changed since Mubarak’s departure and that the military rule is turning a blind eye to the increase in smuggling, and at the same time has also lost control over Sinai and the Beduin tribes there. The closer ties between Egypt and Hamas are understood by Israel as possibly connected to the upcoming elections in Egypt and a desire by the current leadership to align itself with the Muslim Brotherhood, which it understands will gain power in the vote.




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DTN News - NAVISTAR DEFENSE NEWS: Navistar Defense To Produce Second Round Of MRAP Recovery Vehicle

Asian Defense News: DTN News - NAVISTAR DEFENSE NEWS: Navistar Defense To Produce Second Round Of MRAP Recovery Vehicle
(NSI News Source Info) TORONTO, Canada / WARRENVILLE, Ill. - July 18, 2011: Navistar Defense, LLC today announced that it received a delivery order for 140 International® MaxxPro® Recovery vehicles with rocket-propelled grenade (RPG) nets from the U.S. Marine Corps Systems Command. The order for $142 million also includes parts and support for the Mine Resistant Ambush Protected (MRAP) vehicles. Navistar received its first MaxxPro Recovery vehicle order in November 2010.

"Many mission types require MRAP survivability protection and that includes warfighters running vehicle recovery and support missions," said Archie Massicotte, president, Navistar Defense. "To meet urgent needs, we completed delivery of the last MaxxPro Recovery vehicle order two months ahead of schedule. We are proud that these vehicles are performing well and we will work swiftly again to deliver these additional trucks."

The MaxxPro Recovery vehicle is based on the same International® WorkStar® platform that lends its flexibility to the company's growing family of vehicles. MRAP ballistic, mine and improvised explosive device (IED) protection aids two- to three-man crews as they retrieve damaged or mission-disabled vehicles and carry out other support missions.

The company will produce the vehicles at its West Point, Miss., facility where assembly of the recent MaxxPro Dash and Dash ambulance orders is currently being conducted. Recovery vehicles will be integrated into the running assembly line and will be delivered in October and November 2011.

"Today's orders are within our $1.9 billion guidance for fiscal year 2011 and add to our total vehicle fleet of more than 32,000 vehicles," said Massicotte. "Our vehicles are in use in 26 different countries, and as we move forward, we will continue to provide fleet support whenever and wherever they may be operating."

Navistar International Corporation (NYSE: NAV) is a holding company whose subsidiaries and affiliates produce International® brand commercial and military trucks, MaxxForce® brand diesel engines, IC Bus™ brand school and commercial buses, Monaco® RV brands of recreational vehicles, and Workhorse® brand chassis for motor homes and step vans. It also is a private-label designer and manufacturer of diesel engines for the pickup truck, van and SUV markets. The company also provides truck and diesel engine service parts. Another affiliate offers financing services. Additional information is available at www.Navistar.com/newsroom.

Forward-Looking Statement
Information provided and statements contained in this report that are not purely historical are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. Such forward-looking statements only speak as of the date of this report and the company assumes no obligation to update the information included in this report. Such forward-looking statements include information concerning our possible or assumed future results of operations, including descriptions of our business strategy. These statements often include words such as "believe," "expect," "anticipate," "intend," "plan," "estimate," or similar expressions. These statements are not guarantees of performance or results and they involve risks, uncertainties, and assumptions. For a further description of these factors, see Item 1A, Risk Factors of our Form 10-K for the fiscal year ended October 31, 2010, which was filed on December 21, 2010. Although we believe that these forward-looking statements are based on reasonable assumptions, there are many factors that could affect our actual financial results or results of operations and could cause actual results to differ materially from those in the forward-looking statements. All future written and oral forward-looking statements by us or persons acting on our behalf are expressly qualified in their entirety by the cautionary statements contained or referred to above. Except for our ongoing obligations to disclose material information as required by the federal securities laws, we do not have any obligations or intention to release publicly any revisions to any forward-looking statements to reflect events or circumstances in the future or to reflect the occurrence of unanticipated events.



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