Iran says Syrian government not behind possible chemical attack

DUBAI |(Reuters) - Iranian Foreign Minister Mohammad Javad Zarif said on Thursday the Syrian government could not have been behind a possible chemical weapon attack on the outskirts of Damascus as President Bashar al-Assad's forces had the upper hand in the fighting.

"If the use of chemical weapons is true, it has definitely been carried out by terrorist ... groups, because they have proved in action that they refrain from no crime," Iran's Press TV quoted Zarif as telling his Turkish counterpart, Ahmet Davutoglu, in a telephone conversation.
(Reporting by Jon Hemming; Editing by John Stonestreet)

Cornered Hamas looks back at Iran, Hezbollah

By Nidal al-Mughrabi

GAZA |(Reuters) - Stunned by turmoil in neighboring Egypt and starved of funds, the Palestinian Islamist group Hamas is looking to repair damaged ties with its traditional Middle East allies, Iran and the Lebanese Hezbollah party.

An off-shoot of the Muslim Brotherhood, Hamas celebrated when the Sunni movement's Mohamed Mursi was elected president of Egypt in 2012, believing the vote would boost its own international standing and its grip on the isolated Gaza Strip.

Insight: Iran's Arab minority drawn into Middle East unrest

By Isabel Coles

(Reuters) - Arab insurgents blew up a gas pipeline in Iran last week and dedicated the attack to their brothers in arms in Syria, highlighting how the Syrian civil war is spreading into a region-wide proxy conflict that could blow back onto Iran.
The blast, two days after new President Hassan Rohani took office, hit a pipeline feeding a petrochemicals plant in the city of Mahshahr in Iran's southwest, home to most of its oil reserves and to a population of ethnic Arabs, known as Ahwazis for the main town in the area.

New Iranian president vows support for Assad

By BASSEM MROUE
Associated Press

BEIRUT (AP) -- Iran's new president expressed his country's support to Syria's embattled leader Bashar Assad's regime Sunday, saying no force in the world will be able to shake their decades-old alliance.

Hasan Rouhani's comments came as Syrian troops and rebels fought some of the fiercest battles in the mountains of the coastal province of Latakia, an Assad stronghold.

Rouhani made the comments during a meeting in the Iranian capital of Tehran on Sunday with Syrian Prime Minister Wael al-Halqi, Syria's state news agency SANA said.

Syria has been Tehran's strongest ally in the Arab world since Iran's 1979 Islamic Revolution.

Iran has been one of Assad's strongest backers since Syria's crisis began. Tehran is believed to have supplied Assad's government with billions of dollars since the country's crisis began in March 2011. Iran-supported Hezbollah also has sent fighters into Syria to bolster an offensive by Assad forces.

"The Islamic Republic of Iran aims to strengthen its relations with Syria and will stand by it in facing all challenges," SANA quoted Rouhani as saying in a report from Tehran. "The deep, strategic and historic relations between the people of Syria and Iran ... will not be shaken by any force in the world."

Rouhani was elected in June and was endorsed by the country's supreme leader on Saturday, allowing him to begin acting as president. He was sworn in Sunday.

Rouhani condemned foreign intervention in Syria, saying that the Arab country is passing through a "failed attempt" to strike at the "axis of resistance and rejection to Zionist-American plans in the region," SANA quoted him as saying.

Damascus and Tehran reject the idea that there is an uprising in Syria and say the country is being subjected to an Israeli-American conspiracy because of its support to militant groups such as Lebanon's Hezbollah.

SANA quoted Rouhani as saying that Syria will come out of this war "victorious."

Al-Halqi said the Syrian people will "not forget friends who stood by their side during times of difficulties," SANA reported.

Later Sunday, Assad took part in an iftar, the meal that breaks the dawn-to-dusk fast during the Muslim holy month of Ramadan. The iftar was attended by government officials, religious leaders and members of the country's unions and political parties, SANA said. It added that Assad gave a speech.

"The president spoke about the latest developments of the Syrian crisis and heroic acts and victories of the Syrian army in defending the country," SANA said, publishing a picture of Assad giving a speech in front of dozens of people. It was Assad's second public appearance this week after he visited troops in the Damascus suburb of Daraya on Thursday to mark Army Day.

More than 100,000 people have been killed since the uprising against the Assad family's four-decade rule began in March 2011. The revolt later escalated into a civil war, which has uprooted millions of people from their homes.

Also Sunday, the Britain-based Syrian Observatory for Human Rights said the clashes in the Jabal al-Akrad region in Latakia province began around dawn when rebels attacked government forces' posts. It said both sides used tanks, artilleries and mortars in the fighting, while government warplanes took part in the battles.

Although much of Latakia has been under the firm control of Assad's forces, some mountainous regions such as Jabal al-Akrad and Jabal al-Turkomen have witnessed fighting because they are close to rebel-held areas.

The observatory said 12 rebels, including foreign fighters, were killed in the fighting, as well as 19 troops and pro-government gunmen. Dozens were wounded as well, it said.

The Local Coordination Committees, another activist group, said at least eight people were killed in the fighting in Latakia province. It added that rebels fired Russian-made Grad rockets at government positions.

Iran grants Syria $3.6 billion credit to buy oil products

 

By Suleiman Al-Khalidi

AMMAN | Wed Jul 31, 2013 12:47pm EDT

(Reuters) - Syria and Iran signed a deal this week to activate a $3.6 billion credit facility to buy oil products to shore up President Bashar al-Assad's war battered economy, officials and bankers said on Wednesday.
The deal, which was agreed in May and will allow Iran to acquire equity stakes in investments in Syria, is part of Shi'ite Iran's broader support for Assad in his battle against a two-year insurgency by mainly Sunni rebels.
Tehran has already provided military assistance to Assad, training his forces and advising on military strategy. Iranian-backed Hezbollah fighters have also bolstered counter-offensives against rebels around Homs and Damascus.
"This will help Syria to import petroleum products that the country needs," said a Syrian trade official, referring to the credit facility. Underlining the acute nature of Syria's financial problems, he said authorities had tried to set a ceiling of $4 billion on the deal.
Syria is short of diesel for its army and fuel to keep the economy running, partly because of U.S. and European Union financial sanctions imposed after the crackdown on protests at the start of the crisis. Its main supplier of petroleum products by sea has been Iran.
Another $1 billion credit line to Damascus has already been extended to buy Iranian power generating products and other goods in a barter arrangement that has helped Syria export textiles, phosphates and some agricultural produce such as olive oil and citrus products, trade officials say.
"This will allow Syria to import Iranian products up to this ceiling, with almost half to buy electricity equipment for the sector," the trade official, speaking by phone from Damascus, told Reuters.
Alongside the favorable deferred payment terms of those financing facilities, Damascus has been in talks for months to secure a loan of up to $2 billion with low interest and a long grace period, the official said.
STRONG SIGNAL OF SUPPORT
Syria's economy has been hurt by depletion of foreign reserves that were estimated at around $16-18 billion before the crisis. The country had been earning some $2.5 billion a year from oil exports before the crisis.
With the economy on a war footing and military costs spiraling, Syria has been forced to rely increasingly on new credit lines from its main allies. Russia, Iraq and China have provided support - sometimes in the form of barter deals - but not on the scale of this week's deal with Tehran.
Syria's Deputy Prime Minister Qadri Jamil held talks in Moscow last week about a possible Russian loan to Damascus but no agreement has been announced yet.
The latest deal should also ease financial demands on an economy whose $60 billion GDP is estimated to have shrunk by around 30 percent since the conflict began two years ago.
"It's a strong psychological and political message of support from Iran. They are not just giving you a specific loan but they are giving you funds over a long period and (you can) draw as much as you want on items you choose," said Samir Aita, a prominent Syrian economist living abroad.
"The credit facility will allow Syria to spend much needed funds now tied up on other areas," he added.
Although the financing deal provides short-term relief for Syria, it will push up the long-term debt of a country that once prided itself on a low national debt, bankers say.
Bankers say the credit facilities, that will be channeled through the state-owned Commercial Bank of Syria and Iran's Bank Saderat, could also reduce the mounting pressure on the Syrian pound by limiting the need to pay for imported products and foodstuffs with scarce foreign currency.
The pound has crashed as low as one-sixth of its pre-crisis value against the dollar, leading to rampant inflation. Currency traders say the pound plunged to 300 to the dollar earlier this month before recovering to around 200.
"There will be less demand on the dollar when the state gets oil products and flour from Iran and we export to them textiles and some foodstuffs," said Essam Zamrick, deputy head of the Damascus chamber of industry.
Last year Iran and Syria arranged a gasoline-for-diesel swap, but the loss of Syria's main oil producing areas in the east meant that Damascus no longer has the light crude it produced nor the extra gasoline and naphtha it used to export.
Nevertheless, Iran has steadily expanded longstanding economic ties with Syria to help it withstand Western economic sanctions and sealed a free trade deal that granted Syrian exports a low 4 percent customs tariff.
Tehran used to supply Damascus with up to a $1 billion worth of oil products on similar credit terms in the early 1980s before Syria became an oil producer.
BANK VAULTS
Last January, Tehran agreed during a visit by Syrian Prime Minister Wael al-Halki to deposit $500 million in Syria's central bank vaults to prop up the local currency, banking sources say.
The latest credit facility deal was welcomed by a cash-starved business community that has little access to Western financial systems under sanctions.
"These credit facilities will help exporters and businessmen who are suffering from lack of credit and loans that have raised costs and led to a capital flight," said Zamrick.
The deal will also open the door to wider Iranian investments in infrastructure projects such as power plants and heavy industry.
Officials say Iran's strong political support will ensure it gets a lion's share of reconstruction projects, assuming Assad remains in power. Iran and Syria already have an existing car assembly plant, one of several multi-million dollar joint projects that began before the 2011 troubles.
Iranian firms have also been awarded more contracts in the power sector and have signed deals to construct several grain silos which will be financed through the expanded credit lines, one banking source said.
Under that credit financing deal, Syria has also received 250,000 tons of Iranian flour, easing bread shortages in government-held areas caused by the loss to rebels of almost half the northern city of Aleppo, where most of the country's milling capacity existed
(Editing by Dominic Evans and Giles Elgood)

Syria Update.

Iran has agreed to supply Damascus with $3.6bn in oil in exchange for the right to invest in the country, Syria's state news agency SANA said on Tuesday.
"An agreement was signed on Monday in Tehran... by the Iranian and Syrian central banks, granting Syria a credit line worth $3.6bn," it reported. The deal stipulates that Syria will pay back the cost of the oil loan "through Iranian investments of various kinds in Syria", said SANA.
[SANA]

.................
Syrian army retakes another district of Homs says state television after taking most of the Khaldieh neighbourhood in recent days.
Syrian state television showed pictures of Homs on Tuesday saying that that the government army had regained control of the Al Matahen district of the devastated city. The Syrian army made gains in the Khaldieh after launching an offensive in the area on July 27. Rebels had held Khaldieh for more than a year.
[Syria State Television]

Insight: By relying on Iran, Syria's Assad risks irrelevance

 
(Reuters) - Military support from Iran and its Shi'ite ally Hezbollah has given Syrian President Bashar al-Assad new impetus in his fight against the insurgents intent on ousting him, but at a price.
Assad now risks losing much of his autonomy to Tehran and becoming a pawn in a wider sectarian war between Sunni Muslims and Shi'ites that may not end even if he is forced to step down, military experts and diplomats in the region say.
Having lost thousands of troops and militiamen from his Alawite sect as the war grinds through its third year, and anxious to preserve his elite loyalist units, Assad is now relying on Hezbollah from Lebanon and other Shi'ite militias allied with Iran to turn the tide of battle.
Alawite army units with their vast arsenal of artillery and missiles have been taking a back seat in combat, using these weapons supported by the air force to obliterate rebellious neighborhoods and blow holes in rebel lines for Iranian-and Hezbollah-trained local militias.
In some cases men from Hezbollah, an Iranian-backed group that is one of Lebanon's most powerful military and political forces, have been doing the street fighting, according to rebel commanders and other opposition sources.
Under this new arrangement, Hezbollah and Iran have become directly involved in the command structures of Assad's forces, eroding his authority and the Alawite power base that has underpinned four decades of family rule by him and his father.
The Alawites, to which Assad belongs, are an offshoot of Islam that has controlled Syria since the 1960s.
Unlike the Shi'ites in Iraq, Iran and Lebanon, Syria's Alawites tend to be secular and lack the religious zeal that has helped motivate thousands of Shi'ite militia to come to Syria.
Security sources in the region estimate there are about 15,000 Shi'ite fighters from Lebanon and Iraq in Syria, and they have helped produce success on the battlefield, reversing gains made by rebels in two years of fighting.
When rebel fighters have held confined areas, such as the border town of Qusair, which was overrun by Hezbollah and Assad loyalists two months ago, they have put themselves at a serious disadvantage, the sources said.
Rebellious Sunni districts in Homs to the south are being hit hard and Damascus suburbs, a main concentration of the Arab- and Western-backed Free Syrian Army, are under siege as the war's death toll climbs above 90,000.
But Assad's newfound military advantage may prove short lived, despite the increasing pressure on the rebels, military experts and diplomats believe.
The fall of Qusair, and Hezbollah's triumphant rhetoric, spurred regional heavyweight Saudi Arabia into action. The kingdom, diplomats say, has assumed the main role in backing the opposition in coordination with the United States.
TRAINED MILITIAS
Signs of renewed support for the opposition are showing in the northern city of Aleppo, where a government counterattack backed by Hezbollah, which trained Shi'ite militia in the area, has stalled, according to the opposition.
Even if Assad can capture Homs, hold Damascus and overrun neighborhoods that had fallen to rebels, such as Jobar, Barzeh and Qaboun, he would preside over a much reduced country.
Kurdish fighters are consolidating their hold on a de facto autonomous region in the grain- and oil-producing northeastern province of Hasakah that came to being after Assad's forces withdrew to concentrate on defending areas in the interior.
Hardline Islamist brigades are ruling much of two provinces east of Hasakah and they are strongly present in Aleppo. Assad is mainly left with Damascus and a corridor running through Homs to his Alawite heartland and army bases on the coast and to Hezbollah's strongholds in Lebanon.
Andrew Terrill, research professor of national security affairs at the U.S. Army War college, said the rebels will "hang on" because Assad has lost too much of the country.
"Winning battles is very different than winning wars because people who are under assault are going to recoup at some point. The rebels remain armed and remain able to strike at him," Terrill told Reuters.
"Assad may be able to win in the sense that he may stay in power and he is not overthrown directly, but I cannot imagine him pacifying the country because I just think there are too many rebels and too much resistance," he said.
Terrill said new weapons expected from Saudi Arabia are bound to redress the balance of power as well as promised U.S. arms. Salim Idriss, head of the Free Syrian Army's command, is due to visit the United States this week to press for speedy U.S. arms shipments.
Iran meanwhile, continues to supply Assad with military assistance and financing estimated at $500 million a month, according to opposition sources.
"The Iranians and Hezbollah go in and train people and if they can whip these militias into shape then Assad could increasingly rely on them and spare his crack troops," Terrill said.
Hezbollah has openly acknowledged its involvement in Syria, but Assad and Iran have not commented.
PRAETORIAN GUARD
Faced with losing large areas of Syria to mainly Sunni rebel fighters, Assad has adjusted tactics in the last few months to preserve his mostly Alawite Praetorian guard units -- the Republican Guards, the Fourth Division and the Special Forces -- and started relying on Hezbollah, especially to capture the central region of Homs, the sources said
Mohammad Mroueh, a member of the Syrian National Council, said Hezbollah and Iran have been training the militias Assad is using for street fighting in Homs and have established, together with Iranian officials, operations rooms in the city.
"When there is an area where the army and the militia encounter stiff resistance, they're calling Hezbollah to do the fighting," said Mroueh.
Abu Imad Abdallah, a rebel commander in southern Damascus, said Hezbollah fighters and Iraqi Shi'ite militia were key to capturing two areas on the south-eastern approaches to the capital -- Bahdaliyeh and Hay al Shamalneh -- in recent weeks.
"They went in after saturation bombing by the regime. They are disciplined and well trained and are fighting as religious zealots believing in a cause. If it was the army we would not be worried," he said.
But veteran opposition activist Fawaz Tello said that using Hezbollah was a sign of Assad's weakness, pointing to his inability to rely on Sunnis who form the bulk of the army.
"Remember that Assad started this conflict with about a million men under arms between conscripts and the army and the security apparatus. Now more and more he is relying on foreign troops and without them he will lose, especially if the rebels begin to receive advanced weapons," Tello said.
Assad was now becoming an Iranian proxy, Tello said, while Mamoun Abu Nawar, a Jordanian military analyst, said the Syrian leader was forced to bow to the will of Tehran.
"He can no longer call a division head and tell him to bomb the hell out of this neighborhood or that. His command has been eroded and the command structure is now multinational," Abu Nawar said.
A diplomat in the region put it more bluntly: "Whether Assad stays or goes is becoming irrelevant. The conflict is now bigger than him, and it will continue without him. Iran is calling the shots."
(Editing by Giles Elgood)

Syria war widens rift between Shi'ite clergy in Iraq, Iran

(Reuters) - The civil war in Syria is widening a rift between top Shi'ite Muslim clergy in Iraq and Iran who have taken opposing stands on whether or not to send followers into combat on President Bashar al-Assad's side.
Competition for leadership of the Shi'ite community has intensified since the U.S.-led invasion of 2003 toppled Saddam Hussein, empowering majority Shi'ites through the ballot box and restoring the Iraqi holy city of Najaf to prominence.
In Iran's holy city of Qom, senior Shi'ite clerics, or Marjiiya, have issued fatwas (edicts) enjoining their followers to fight in Syria, where mainly Sunni rebels are fighting to overthrow Assad, whose Alawite sect derives from Shi'ite Islam.
Shi'ite militant leaders fighting in Syria and those in charge of recruitment in Iraq say the number of volunteers has increased significantly since the fatwas were pronounced.
Tehran, Assad's staunchest defender in the region, has drawn on other Shi'ite allies, including Lebanese militia Hezbollah.
Hezbollah's open intervention earlier this year hardened the sectarian tone of a conflict that grew out of a peaceful street uprising against four decades of Assad family rule, and shifted the battlefield tide in the Syrian government's favor.
The Syrian war has polarized Sunnis and Shi'ites across the Middle East - but has also spotlighted divisions within each of Islam's two main denominations, putting Qom and Najaf at odds and complicating intra-Shi'ite relations in Iraq.
In Najaf, Grand Ayatollah Ali al-Sistani, who commands unswerving loyalty from most Iraqi Shi'ites and many more worldwide, has refused to sanction fighting in a war he views as political rather than religious.
Despite Sistani's stance, some of Iraq's most influential Shi'ite political parties and militia, who swear allegiance to Iranian Supreme Leader Ayatollah Ali Khamenei, have answered his call to arms and sent their disciples into battle in Syria.
"Those who went to fight in Syria are disobedient," said a senior Shi'ite cleric who runs the office of one of the top four Marjiya in Najaf.
"SHI'ITE CRESCENT"
The split is rooted in a fundamental difference of opinion over the nature and scope of clerical authority.
Najaf Marjiiya see the role of the cleric in public affairs as limited, whereas in Iran, the cleric is the Supreme Leader and holds ultimate spiritual and political authority in the "Velayet e-Faqih" system ("guardianship of the jurist").
"The tension between the two Marjiiya already existed a long time ago, but now it has an impact on the Iraqi position towards the Syria crisis," a senior Shi'ite cleric with links to Marjiiya in Najaf said on condition of anonymity.
"If both Marjiiya had a unified position (toward Syria), we would witness a position of (Iraqi) government support for the Syrian regime".
The Shi'ite-led government in Baghdad says it takes no sides in the civil war, but the flow of Iraqi militiamen across the border into Syria has compromised that official position.
Khamenei and his faithful in Iraq and Iran regard Syria as a important link in a "Shi'ite Crescent" stretching from Tehran to Beirut through Baghdad and Damascus, according to senior clerics and politicians.
Answering a question posted on his website by one of his followers regarding the legitimacy of fighting in Syria, senior Iraq Shi'ite cleric Kadhim al-Haeari, who is based in Iran, described fighting in Syria as a "duty" to defend Islam.
Militants say that around 50 Iraqi Shi'ites fly to Damascus every week to fight, often alongside Assad's troops, or to protect the Sayyida Zeinab shrine on the outskirts of the capital, an especially sacred place for Shi'ites.
"I am following my Marjiiya. My spiritual leader has said fighting in Syria is a legitimate duty. I do not pay attention to what others say," said Ali, a former Mehdi army militant who was packing his bag to travel from Iraq to Syria.
"No one has the right to stop me. I am defending my religion, my Imam's daughter Sayyida Zeinab's shrine."
A high-ranking Shi'ite cleric who runs the office of one of the four top Marjiiya in Najaf said the protection of Shi'ite shrines in Syria was used as a pretext by Iran to galvanize Shi'ites into action.
"SHI'ITE PROJECT"
In the 10 years since Saddam's fall, Iran's influence in Iraq has grown and it has sought to gain a foothold in Najaf in particular.
Senior Iranian clerics have opened offices in Najaf, as well as non-governmental organizations, charities and cultural institutions, most of which are funded directly by Marjiiya in Iran, or the Iranian Embassy in Baghdad, local officials said.
The Iranian flag flies over a two-storey building in an upscale neighborhood of Najaf, which houses the "Imam Khomeini Institution", named after the Islamic Republic's founder, Ayatollah Ruhollah Khomeini.
The Imam Khomeini Institution is one of many Iranian entities that have engaged in social activities in Iraq, focusing on young men, helping them get married, and paying regular stipends to widows, orphans and students of religion.
Some institutions also support young clerics and fund free trips for university students to visit Shi'ite shrines in Iran, including a formal visit to Khamenei's office in Tehran, Shi'ite politicians with knowledge of the activities say.
"We have a big project in Iraq aimed at spreading the principles of Velayet e-Faqih and the young are our target," a high-ranking Shi'ite leader who works under Khamenei's auspices said on condition of anonymity.
"We are not looking to establish an Islamic State in Iraq, but at least we want to create revolutionary entities that would be ready to fight to save the Shi'ite project".
(Editing by Isabel Coles and Mark Heinrich)