DATE=2/8/99 TYPE=BACKGROUND REPORT NUMBER=5-42545 TITLE=IRANIAN REVOLUTION AT 20: RELATIONS WITH U-S BYLINE=ALI JALALI DATELINE=WASHINGTON CONTENT= NOT VOICED: INTRO: IRAN THIS MONTH (FEB 11) CELEBRATES THE TWENTIETH ANNIVERSARY OF THE ISLAMIC REVOLUTION THAT OVERTHREW THE PRO-AMERICAN REGIME OF MOHMMAD RAZA SHAH PAHLAVI. (IN THIS SECOND OF A THREE PART SERIES) V-O-A'S ALI JALALI LOOKS AT PROSPECTS FOR IMPROVEMENTS IN U-S-IRAN RELATIONS, WHICH HAVE BEEN FROZEN SINCE THE ESTABLISHMENT OF THE REVOLUTIONARY GOVERNMENT IN IRAN. TEXT: U-S RELATIONS WITH IRAN TURNED HOSTILE RIGHT AFTER THE VICTORY OF THE REVOLUTION. THE IRANIAN REVOLUTIONARIES, WHO WERE MILITANTLY ISLAMIC AND ANTI-WESTERN, BLAMED THE UNITED STATES FOR SUPPORTING THE SHAH'S AUTHORITARIAN REGIME, AS WELL AS WASHINGTON'S ROLE IN THE REMOVAL IN 1953 OF THE COUNTRY'S POPULAR NATIONALIST PRIME MINISTER, MOHAMMAD MOSADEQ. IN NOVEMBER 1979, IRANIAN STUDENTS, WITH THE APPROVAL OF THE REVOLUTIONARY LEADER AYATOLLAH KHOMEINI, SEIZED THE U-S EMBASSY IN TEHRAN AND HELD 52 AMERICAN HOSTAGES FOR 444 DAYS. THE HOSTAGE CRISIS LEFT A LASTING IMPACT ON RELATIONS BETWEEN THE TWO NATIONS. WASHINGTON OPPOSED IRAN DURING ITS DEVASTATING WAR WITH IRAQ (1980-88), FROZE IRANIAN ASSETS IN U-S BANKS AND IMPOSED ECONOMIC SANCTIONS ON THE ISLAMIC REPUBLIC. THE UNITED STATES JUSTIFIED ITS ACTIONS BY CITING WHAT IT SAID WERE IRAN'S THREATS TO AMERICAN INTERESTS AND U-S ALLIES, INCLUDING IRAN'S SPONSORING OF TERRORISM, ITS OPPOSITION TO THE MIDDLE EAST PEACE PROCESS AND ITS EFFORTS TO DEVELOP WEAPONS OF MASS DESTRUCTION. AFTER YEARS OF COOLNESS, HOPES FOR A THAW IN U-S-IRAN RELATIONS WERE AROUSED LAST YEAR WHEN IRAN'S NEW MODERATE PRESIDENT, MOHAMMAD KHATAMI, CALLED FOR AN UNOFFICIAL DIALOGUE BETWEEN THE TWO NATIONS. A POSITIVE RESPONSE FROM WASHINGTON AND A SERIES OF ACADEMIC AND ATHLETIC EXCHANGES BETWEEN THE TWO COUNTRIES FOLLOWED. LAST JUNE, U-S SECRETARY OF STATE MADELEINE ALBRIGHT ANNOUNCED U-S READINESS TO WORK OUT WITH IRAN WHAT SHE CALLED A "ROAD MAP" TO NORMAL RELATIONS. BUT, AS FORMER ASSISTANT SECRETARY OF STATE ROBERT PELLETREAU SAYS, PARTISAN DIFFERENCES IN BOTH COUNTRIES FRUSTRATED PROSPECTS FOR BETTER TIES. // PELLETREAU ACT // THESE POSITIVE GESTURES WERE NOT UNIVERSALLY WELCOMED IN EITHER SOCIETY AND IN PARTICULAR IN IRAN THEY PROVOKED A SHREWD AND WELL-TIMED CONSERVATIVE REACTION. AND IN THE UNITED STATES TOO, EVIDENCE OF CONTINUING IRANIAN INVOLVEMENT IN TERRORISM AND NEW EXPRESSION OF ANIMOSITY TOWARD ISRAEL AND THE (MIDDLE EAST) PEACE PROCESS, CONTINUING INTEREST IN NUCLEAR TECHNOLOGY, PERHAPS NUCLEAR WEAPONS, SHOWED THAT THE MOMENTUM TOWARD BETTER RELATIONS WAS NOT FULLY SHARED AND GAVE CONSERVATIVES FORCES IN (U-S) CONGRESS AND ELSEWHERE SOME SOLID REASON TO CONTINUE A MORE RESTRICTIVE POLICY. // END ACT // ONE OF THE MAIN ELEMENTS OF THIS RESTRICTIVE POLICY TOWARD IRAN HAS BEEN U-S SANCTIONS AGAINST THE ISLAMIC REPUBLIC. THE CLINTON ADMINISTRATION BANNED TRADE WITH IRAN IN 1995 AND CONGRESS ADOPTED LEGISLATION IN 1996 (KNOWN AS IRAN-LIBYA SANCTIONS ACT) THAT PUNISHES FOREIGN COMPANIES INVESTING MORE THAN 20 MILLION DOLLARS IN IRAN'S ENERGY SECTOR. IRAN HAS STRONGLY CRITICIZED THE SANCTIONS, WHICH IT VIEWS AS THE MAJOR OBSTACLE IN NORMAL RELATIONS WITH THE UNITED STATES. THE U-S BUSINESS COMMUNITY HAS ALSO EXPRESSED DOUBTS ABOUT THE EFFECTIVENESS OF THE SANCTIONS, SAYING THERE IS NO EVIDENCE THAT SANCTIONS HAVE OR CAN SUCCEED IN CHANGING IRAN'S BEHAVIOR. HOWEVER, THE SANCTIONS AGAINST IRAN ARE STRONGLY SUPPORTED BY CONGRESS, WHICH BELIEVES THAT WHILE THE UNITED STATES CANNOT INFLUENCE IRANIAN INTENTIONS, IT SHOULD USE SANCTIONS TO LIMIT WHAT IRAN IS CAPABLE OF DOING. PUNEET TALWAR, A STAFF MEMBER OF THE SENATE FOREIGN RELATION COMMITTEE, SAYS THE RECENT CHANGES IN THE IRANIAN GOVERNMENT, HAVE NOT YET LED TO AND SIGNIFICANT CHANGES IN IRANIAN POLICIES. // TALWAR ACT // MANY IN CONGRESS ARE AWARE OF POLITICAL CHANGES THAT HAVE OCCURRED IN IRAN ESPECIALLY SINCE THE ELECTION OF PRESIDENT KHATAMI. THEY WOULD LIKE TO SEE A MODERATE IRAN AND IMPROVED RELATIONS UNDER THE RIGHT CIRCUMSTANCES. BUT THEY STILL REGARD IRAN AS HOSTILE TO AMERICAN INTERESTS. I BELIEVE THAT IN THE ABSENCE OF SIGNIFICANT CHANGES IN IRANIAN BEHAVIOR IN THE FAMILIAR THREE AREAS OF U-S CONCERNS -- WEAPONS OF MASS DESTRUCTION, TERRORISM AND VIOLENT OPPOSITION TO ARAB-ISREAELI PEACE -- CONGRESS IS NOT LIKELY TO UNILATERALLY REMOVE SANCTIONS THAT IT HAS LEGISLATED. // END ACT // BUT CONGRESSIONAL SOURCES SAY THE LAWMAKERS DO SUPPORT, IN PRINCIPLE, THE OPENING OF AN OFFICIAL DIALOGUE WITH IRAN. THIS HAS DRAWN SUPPORT FROM OTHER QUARTERS. LAST MONTH, IN A SPEECH TO THE ASIA SOCIETY IN NEW YORK, FORMER SECRETARY OF STATE CYRUS VANCE ISSUED A CALL FOR MORE FREQUENT OFFICIAL CONTACT BETWEEN WASHINGTON AND TEHRAN. MR. VANCE WHO PARTICIPATED IN THE U-S DECISION TO BREAK DIPLOMATIC RELATIONS WITH IRAN SOME 19 YEARS AGO, SAYS IT IS TIME TO LOOK TO THE FUTURE. // VANCE ACT // I BELIEVE IT IS TIME FOR IRAN AND THE UNITED STATES TO RE-ESTABLISH DIPLOMATIC TIES. LEADERSHIP OF PRESIDENT KHATAMI OFFERS AN OPPORTUNITY FOR IRAN AND THE UNITED STATES TO AMELIORATE THEIR TENSE AND ESTRANGED RELATIONSHIP. ONCE DIPLOMATIC RELATIONS ARE ESTABLISHED, EVEN AT LESS THAN THE AMBASSADORIAL LEVEL, OTHER LEGITIMATE GRIEVANCES, INCLUDING OUR CONCERNS ABOUT TERRORISM, THE PEACE PROCESS AND WEAPONS OF MASS DESTRUCTION CAN BEGIN TO BE ADDRESSED. // END ACT // INDEPENDENT OBSERVERS IN BOTH COUNTRIES NOTE THAT A SERIOUS ENGAGEMENT CAN OFFER BOTH SIDES SIGNIFICANT POLITICAL AND ECONOMIC BENEFITS. THEY SAY MENDING RELATIONS WITH THE UNITED STATES MAY BOOST IRAN'S TROUBLED ECONOMY AND ATTRACT FOREIGN INVESTMENT, WHILE FOR THE UNITED STATES, IRAN CAN BE A POWERFUL PARTNER IN STRENGTHENING AMERICA'S MIDDLE EAST AND CENTRAL ASIAN POLICIES. BUT ANALYSTS SAY IT IS UNREALISTIC TO EXPECT ANY DRAMATIC CHANGES IN U-S / IRANIAN RELATIONS UNTIL SUPPORTERS OF A SERIOUS DIALOGUE WITH THE UNITED STATES WIELD GREATER POLITICAL POWER IN IRAN. ONLY THEN, THE ANALYSTS SAY, WILL A TEHRAN GOVERNMENT HAVE THE STRENGTH TO MAKE BOLD DECISIONS. (SIGNED) NEB/AJ/KL 08-Feb-99 1:51 PM EST (1851 UTC) NNNN Source: Voice of America .