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Research Report


J. Matthew McInnis
Copyright Date: Apr. 1, 2017
Pages: 32
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Table of Contents

  1. (pp. 3-3)

    The Islamic Republic of Iran (IRI) is on the cusp of making significant decisions about what it wants to be as a state and what it wants its military to become following the implementation of the Joint Comprehensive Plan of Action (JCPOA). In my previous report, Iranian Concepts of Warfare, I laid out an argument that Tehran may have begun shifting its view on warfare and that it is appropriate and ideologically acceptable now for the IRI to seek offensive capabilities and doctrines in addition to defensive ones. This represents profound change in Tehran’s narrative since the 1979 Islamic Revolution,...

  2. (pp. 4-11)

    As previously discussed in Iranian Concepts of Warfare, the IRI approaches economic decision-making through a heavily statist approach. This reflects the Marxist influences of Ayatollah Khomeini and other revolutionary leaders eager to break Iran away from US economic dominance and Western imperialism. In subsequent decades, Iranian political elites readily admitted that the economic sphere—as opposed to the religious, political, security, or cultural spheres—is the one arena in which the revolution has not succeeded in bringing Khomeini’s original vision to fruition. Despite Iranian leaders’ economic diversification efforts, their approach maintains a statist approach.

    In this context, Iran still attempts...

  3. (pp. 12-17)

    With the possible exception of North Korea, no other medium-sized power is as focused on deepening the indigenization of its military production as the IRI. This is a near-impossible challenge without the resources of a world power such as the United States, China, or Russia. Iran chose this path partly out of an ideological desire to be independent from foreign influence. IRI’s drive toward self-sufficiency by way of procurement, research, and development is mostly a matter of necessity.

    Under the Shah’s rule, Iran’s military consisted almost entirely of US and other Western equipment. After 1979, the IRI was not only...

  4. (pp. 18-22)

    Based on historical patterns in Tehran’s military budget process and the structural dynamics within the Iranian defense industrial base, the following key characteristics and drivers of the Iranian defense acquisition and research and development decision-making processes become apparent.

    Iranian willingness to invest in conventional and unconventional military capabilities is significant by international standards but has limitations and lags behind regional rival Saudi Arabia. The IRI’s official defense expenditure as a percentage of GDP has been consistently between 2.5 and 3.0 percent since the end of Iran-Iraq War, and total spending is likely between 4.0 and 5.0 percent of GDP most...

  5. (pp. 23-24)

    As Iranian leaders debate exactly what their long-term threat environment and defense-spending priorities will be, robust increases in military spending are probable in the next five years, given GDP is likely to rise at 4 percent or more. For example, the budget Rouhani is proposing for 2017 represents an approximate 10 percent increase for the military with a more than 50 percent jump for the IRGC and an approximately 27 percent increase for the Artesh.126 With the UN conventional weapons restrictions remaining in place, those increased levels of funds will most likely follow the path of least resistance: toward systems...