Iran’s shadow looms large over southeastern Iraqi Kurdistan

The recent bust of a major fraud and smuggling network at one of Iraqi Kurdistan's border crossings has drawn attention to the power wielded by Iran in that area, both on the local economy and on local water supplies due to dams built in recent years.

al-monitor Iraqi tourists walk past the Sherwana Citadel in the Kurdish city of Kalar, 126 kilometers (78 miles) south of Sulaimaniyah, Sept. 27, 2015. Photo by SAFIN HAMED/AFP via Getty Images.

Eyl 23, 2020

KALAR, Iraqi Kurdistan — In this southeastern corner of the Kurdistan Region of Iraq, Iranian influence is clear and of concern to many in the area amid reports of cross-border fraud and smuggling networks.

Dams built by Iran threatening to severely decrease water supplies available for local production may also negatively impact the future of the area.

The Finance Ministry of the Kurdistan Regional Government (KRG) announced earlier this month that a vast smuggling network had been discovered at a border crossing with Iran but did not specify which border crossing.

The crossing referred to was that of Parvizkhan, in the administrative area of Garmiyan in the far southeastern part of Iraqi Kurdistan, officials were quoted by local media outlet Rudaw as saying.

They noted that “hundreds of millions of dinars worth of goods” had been smuggled and that this had “damaged public finance.”

At a farm some miles from this border crossing point in mid-September, Al-Monitor could hear several lorries continuing to travel along the road running from Iran to Kalar late into the night. Locals claimed that many of the goods passing through the border crossing unofficially were brought in after dark.

The border is where the largest amount of goods pass into Iraq from Iran, which exported some 1.34 tons of commodities worth $562 million in the first four months of the Iranian year (March 20-July 21), marking a whopping rise of 78% in tonnage and 33% in value, Iranian media reported in August.

In 2017, the Parvizkhan border crossing accounted for over 54% of Iran’s exports to Iraq. A three-month closing of it, after a referendum was held on independence of Iraqi Kurdistan from the rest of Iraq, resulted in 3,000 jobs lost in the region on the Iranian side of the border, according to one Iranian media outlet, attesting to its importance.

Iraqi Kurdistan has three border crossings with Iran: Haji Omaran in Erbil province, Parvizkhan in the Garmiyan administration area and Bashmakh in Sulaimaniyah province.

Prime Minister Mustafa al-Kadhimi, who vowed to crack down on corruption as part of his efforts to improve rule of law and the economy in the country after being sworn in on May 7, visited the Mandali border crossing between Iraq and Iran in Diyala province south of Garmiyan on July 11, to kick off a campaign against corruption at customs points in the country.

He said that the government would go after “ghosts” that cross the border without paying customs duties.

The southeastern part of the Kurdistan Region of Iraq has long had closer ties to Iran than much of the rest of the region, and Iran-linked armed groups continue to operate south of it in Diyala province.

A security officer from the region told Al-Monitor, on condition of anonymity as he had not been authorized to speak to the media, that security in some of the disputed territory between Iraqi Kurdistan and Baghdad-controlled areas south of Garmiyan had improved since Kadhimi took office.

He added that “regular forces — the local police, federal police and the army” — were now in more control of some areas that had previous been under the sway only of a motley assortment of Popular Mobilization Units (PMU) linked to Iran in varying degrees.

However, he added that “there are so many factions inside Khanaquin” and “the [Iraqi] army is not performing its duties. You still see Hashid Shaabi [the PMU] controlling every section in that area.”

He stressed that this is a problem and claimed that “whenever there are Iranian borders, the Iranian government will make problems for the commander [in the area].”

The security officer said one tactic often used by Iran was saying that “there are daily delegations from Iran to Khanaquin,” and that “there are VIP people coming from Iran to Khanaquin or are on their way to Najaf and Karbala,” and that no security force except the Iran-linked PMU are capable of providing protection, thus justifying their continued presence.

“And the majority of people around Khanaquin and Jalawla — both Kurds and Arabs — are Shiite,” he added, noting that Iran exploits this fact for its own purposes.

Araz Muhamed, a local journalist, told Al-Monitor during an interview Sept. 15 in Kalar that as part of his reporting work he had found evidence of Iranian intelligence cells located in and monitoring the city.

When this journalist accompanied peshmerga forces then stationed in Khanaquin — in an area disputed between Baghdad and the KRG but currently under central government control — to the front line in Jalawla against the Islamic State in September 2014, she was told by one officer that Iranian forces were in the area in small numbers.

However, KRG forces are now stationed only as far south as the Garmiyan administrative region, which includes the Kalar, Kifir and Chamchamal districts.

The location of Garmiyan in a disputed area sometimes leads to issues with registering land deeds, locals told Al-Monitor during a visit to the area. Local residents who own land near the Iranian border said they had been sent back and forth between offices in Sulaimaniyah and Diyala for official paperwork, with public officials claiming on both sides that it was the responsibility of the other administration.

Another key issue that may irreparably damage the local economy near this border in addition to smuggling, if not curbed, are several dams built in recent years on the Iranian side of the border reducing water supply to the region.

Muhamed stressed that the dams and Iran’s ability to cut off water to the area would become an issue in the coming years and would be detrimental to the local economy on this side of the border, possibly forcing many to move elsewhere.

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