The U.S-led invasion of Iraq in 2003 significantly altered the regional dynamics. With the fall of Saddam Hussein’s regime, Iraq’s new Shia-dominated government found shared religious and ideological ties with Iran, leading to closer relations between the two countries. Iran’s influence in Iraq has increased significantly in the post-2003 era. Iranian support has been crucial in the fight against ISIS and in the formation of various Iraqi governments. This influence has been both political, through support for various Shia political parties and militias, and economic, with Iran becoming a major trade partner for Iraq. Economic relations between Iran and Iraq have grown significantly in the post-2003 era. Trade between the two countries has expanded, with Iran exporting a wide range of goods to Iraq, including food, construction materials, and electricity. In 2019, the trade volume between the two countries reached about$12 billion. However, these economic relations have been impacted by U.S. sanctions on Iran. Iraq has been granted waivers to continue trading with Iran, but these waivers have been periodically reviewed and their future remains uncertain. The U.S.sanctions has also impacted Iranian investments in Iraq. Diplomatically, Iran and Iraq have maintained relatively close relations since2003. High-level visits between the two countries are frequent, and both countries have cooperated on a range of regional issues. However, this closeness has also caused tension, particularly with Sunni Arab states and the U.S., who are wary of growing Iranian influence in Iraq. As of 2023, the relationship between Iran and Iraq continues to be multifaceted. While the two countries continue to maintain close economic and political ties, there are also tensions, particularly over Iran’s influence in Iraq. Iraq has been trying to balance its relations with Iran and its relations with the U.S. and other Arab states. This balancing act has become increasingly difficult as tensions between Iran and the U.S. have escalated, particularly in the wake of the U.S.withdrawal from the Iran nuclear deal in 2018 and the subsequent “maximum pressure” campaign against Iran. Despite these challenges, economic ties between the two countries remain strong.Iraq is heavily dependent on Iran for its energy needs, importing gas and electricity to meet demand, especially during summer months when power consumption is high. Additionally, Iraq serves as an important market for Iranian goods and services, which is crucial for Iran’s economy given the extensive sanctions it faces. The shared Shia religious identity also plays a significant role in the relationship between the two countries, with millions of Iraqi and Iranian pilgrims traveling to each other’s countries annually to visit holy sites. This not only boosts the economies of the two countries but also strengthens cultural and societal ties. However, Iran’s influence in Iraq is controversial. The presence of Iran-backed militias and political factions in Iraq has led to internal tensions and has been a source of concern for other regional and international powers. Many Iraqis, particularly among the Sunni and Kurdish populations, are wary of Iran’s influence in their country. Furthermore, the assassination of Qasem Soleimani, the head of Iran’s Quds Force, by a U.S. drone strike in Baghdad in January 2020, and the subsequent Iranian missile attack on U.S. military bases in Iraq highlighted the potential for Iraq to become a battleground for proxy conflicts. In conclusion, the relationship between Iraq and Iran is complex and multifaceted, shaped by a combination of historical, political, economic, and cultural factors. The two countries are deeply interconnected, but their relationship is also fraught with tensions and potential flashpoints. How this relationship will evolve in the future will depend on a range of factors, including internal political dynamics in both countries, the status of U.S.-Iran relations, and the broader geopolitical context in the Middle East.

By Cora Sulleyman