Toughened Iran defies Trump’s coercion

The profound shift in Iran’s diplomatic posture is striking. In the negotiations preceding both Operation Thunderstorm last June and Operation Epic Fury this February, Tehran appeared amenable to offering significantly greater nuclear concessions. However, since the temporary ceasefire took effect on April 8, Iran has considerably hardened its stance, insisting on a two-step process: first, ending the war with security guarantees, unfreezing assets, and reopening the Strait of Hormuz; and subsequently, discussing the nuclear issue.

Iran has also announced that it is coordinating with Oman to draft a protocol that will permit safe maritime passage through the Strait of Hormuz in exchange for compliance with Iranian conditions, including fees for special services. Interestingly, during the same period, the United States, in addition to abandoning its insistence on zero enrichment, appears to have dropped other long-standing priorities, such as dismantlement of Iran’s missile programme and cessation of its support for its West Asian proxies, from its current diplomatic discourse.

After visiting Beijing, where he failed to secure Chinese cooperation to pressure Tehran, and with his naval blockade failing to bring Tehran to the negotiating table, President Donald Trump has been actively considering another military assault alongside Israel. While this would have benefited Prime Minister Benjamin Netanyahu, particularly with Israel expected to hold early elections, Trump has been strongly dissuaded by Iran's Gulf neighbours, who bore the brunt of the Iranian strikes before the current ceasefire.

Last Monday, Iran transmitted its latest proposal to the US via Islamabad. While the specific details have not been made public, media reports indicate that Iran is no longer demanding that the issues be dealt with chronologically, which should pave the way to restart stalled negotiations.

On the financial front, the US has reportedly agreed to release a quarter of Iran’s frozen funds, though Tehran continues to demand the full release of all assets. Conflicting reports have emerged over whether Washington has agreed to temporarily waive oil sanctions while negotiations continue.

Under the Joint Comprehensive Plan of Action (JCPOA) – agreed to in 2015 by the Obama administration and from which Trump unilaterally withdrew in 2018 during his first term – Tehran transferred more than half of its 20% enriched uranium to Russia, retaining the remainder under the monitoring of the International Atomic Energy Agency (IAEA) to fuel its research reactor. As of now, Iran is resisting shipping its enriched uranium abroad, proposing domestic dilution instead. The two sides also remain divided over the timeline for an enrichment moratorium, with Tehran offering 10 years and Washington demanding 20 years.

However, for Trump, securing nuclear concessions from Iran that exceed the JCPOA terms is essential. Specifically, this would require Iran to agree to transfer its 60% enriched uranium stockpile to Russia, in addition to accepting an enrichment moratorium. Another red line for Trump remains Iran’s insistence on controlling the transit passage through the Strait of Hormuz. But, to accept Trump’s terms, Iran will demand in return a guaranteed end to hostilities, including in Lebanon, the unfreezing of its assets, the lifting of sanctions, and a financial mechanism to reconstruct its severely damaged infrastructure. Nevertheless, Iran will still retain the capability, if required in the future, to inflict severe pain on the global economy by disrupting transit through the strait.

The conclusion of a framework agreement, however, will require considerable patience and long-drawn-out discussions. There are indications that Washington and Tehran may sign a 'letter of intent' that would officially end the war and open 30 days of negotiations on key issues, including reopening the Strait of Hormuz and limiting Iran’s nuclear programme.

Iran is leveraging its 60% enriched uranium as a highly effective bargaining chip, knowing it would be virtually impossible for the US to neutralise this stockpile without substantial risk and boots on the ground. Given Tehran's frequently voiced distrust of Washington, Iran is expected to hold on to this uranium until all terms are finalised and at least partially implemented.

Resilience under pressure

Trump repeatedly relies on a pattern of extreme military and economic threats under the flawed assumption that America's asymmetrical power advantage will eventually force Iran to capitulate. However, this strategy has not succeeded, as the Iranian regime views total surrender to the US as a far greater existential threat than enduring sanctions or military strikes. Years of economic pressure have pushed Tehran to construct what it terms a “resistance economy” – one that is less dependent on Western financial systems, sustained by alternative trade networks, and increasingly anchored in domestic production. At the same time, the Iranian state has combined economic management with tight political control and a narrative of national endurance, enabling it to contain dissent and maintain legitimacy under strain.

With Trump losing patience, he could venture into another attack. A recent Congressional Research Service report said the US lost or had at least 42 aircraft heavily damaged during the 40-day air campaign against Iran. This heavy toll included advanced F-15E and F-35A fighter jets. However, Iran will be even more prepared this time and has warned that it will open new fronts and scale up the conflict. Furthermore, despite the Pentagon’s claims of having inflicted severe damage on Iran, leaked US intelligence reveals that Tehran's missile capabilities remain largely intact or have been successfully restored during the ceasefire.

Marking his second trip to Iran in less than a week, Pakistan's Interior Minister arrived in Tehran on Wednesday to convey a fresh US proposal offering improved incentives on sanctions relief. The Pakistan Army Chief has also landed in Tehran on Friday to help open a 30-day window for further negotiations.

A diplomatic solution remains possible, provided each side is willing to accommodate the other to some extent and can claim victory to satisfy their respective domestic audiences.

(The writer is a former Governor of India to the International Atomic Energy Agency [IAEA], Vienna, a former ambassador to Egypt, and a former permanent representative to the Arab League)