Iran’s missile work: A mere defense policy or an economic gain, too?

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December 28, 2019
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December 30, 2019

Iran’s missile work: A mere defense policy or an economic gain, too?


F rom the economic point of view, any commodity that rolls off the production line should be of economic value and maintain that value in the course of time. In addition, the associated costs — ranging from research and development to production, maintenance, and utilization — need to be reasonable, and it is economic wisdom that constitutes the basis for this logic. If the same approach is applied to arms production, it is easy to understand that none of the arms may ever be put to use — the more advanced the arms are and the more deterrent power they carry, the less possible it becomes to employ them, unless a government resorts to them for serious offensive purposes. In that case, the manufactured arms would be seen as consumer commodities. However, strategic military armaments such as ballistic missiles do not seem to be following the same logic. There is a much higher possibility of a battle tank being deployed during war with a foreign enemy or to safeguard borders during peacetime than a mid-range ballistic missile being fired, while both pieces of military hardware are worth the same amount — at least for Iran; therefore, mid-range or even short-range ballistic missiles fall in the category of rather expensive capital goods. But the question arises as to why Iran has been making notable investments in research and mass production of mid-range ballistic missiles in the years following the 1979 Islamic Revolution instead of making efforts to fulfill the country’s other pressing needs related to its Ground Forces, Navy, and Air Force, which are lagging far behind.

Aside from military logic or any other rationale independent of economy, it should be said that the expenditure on ballistic missiles compared to the funds allocated to battle tanks is much lower for Iran. That is firstly because the grave military threats facing the country, if materialized, could severely impact the country’s economy. So far, Iran’s missile capabilities have successfully deterred hostile acts against the Islamic Republic’s free trade in the neighborhood and other areas within range. Such belligerent measures could have been taken not only by terror groups but also by other states — either independently or in coalition with the United States.

Iran’s missiles have turned into some leverage in the adversaries’ equations and decision-making vis-à-vis the Islamic Republic, leading to the total elimination of a military option against the country’s economic infrastructure, international commerce, and shipping in the high seas. Such conditions have helped Iran preserve capital, positively influencing Iran’s economy not only practically but also existentially. Some are of the opinion that had it not been for Iran’s efforts to upgrade and boost its stockpile of missiles under harsh sanctions over the past 25 years, enemies and regional rivals would have been able to easily deal stinging military blows to the country’s economic infrastructure on the back of the vast combat capabilities that they currently have. Such a viewpoint is based on the doctrine of deterrence. It should be admitted that the deterrent power of the missiles has brought Iran big economic gains in the fields of investment security and commerce. This function of Iran’s missile program has come about while the country’s mid-range missiles have for years been used solely in tests meant to improve the technology. Exhausting efforts to enhance the armored equipment of the Army and the Islamic Revolution Guards Corps (IRGC) could result in the same economic-security gains, but would, instead, turn into a financial black hole, which would leave the Armed Forces in need of constant upgrades, necessitate the abandonment of older equipment and impose high costs on the country for maintenance and training. It should, however, be reaffirmed that such reasoning stems from a pure economic point of view, not military strategies.

Taking the country’s resources into account, Iran’s defense decision-makers have opted to pursue a comprehensive and consistent strategy and make use of the resources and the technology currently at the country’s disposal to meet the defense goals, instead of getting trapped in strategic myopia and go for extravagant purchases of costly potent weapons.

Contrary to the views commonly held by the countries with military industries, Iran’s defense decision-makers believe achieving goals has priority over possessing tools. Super-advanced defense systems are not necessarily needed to dissuade enemies from invasion or to swiftly destroy an enemy target. It would suffice to bring the enemy within range and disrupt its offensive-defensive capabilities, a tactic that should be based on a sustainable and routinely-used military model.

This may be the reason why Iran is not able — and has never sought — to follow in the footsteps of superpowers and get its hands on the latest military technology, which would require massive infrastructure projects. A range of factors — including Iran’s resource ecosystem, the available technology, and the type of pressure and threats facing the country — have persuaded the Islamic Republic to look for lasting peace outside its borders and base its security doctrine on politico-strategic equations involving regional and international powers. Such a choice is natural and cannot be viewed as ambitious; it is simply a path that any country with the size, geographic location, and territorial extent of Iran would take.

Financial concerns — in addition to the harshest of economic sanctions — provide Iran with a strong reason to further bolster its missile capabilities. Based on a simple math equation, Iran would have to pay at least $60 million — including costs on relevant arms, training, and maintenance — for a fighter jet with the characteristics of Russian Mig-35 or Sukhoi Su-30 — or Western models such F-16 and Dassault Mirage 2000 — in order to fulfill its combat needs, an amount that accounts for 12-30 ballistic missiles with ranges of 700 to 1,300 kilometers. A country the size of Iran would need to purchase at least 80 such warplanes — costing some $4.8 billion — in order to meet only about a fourth of its Air Force’s needs. The sum may sound modest when it comes to a strong economy like Iran’s, but the same sum could bring in 960 to 1,800 ballistic missiles capable of being launched from anywhere in the country with maximum security and speed and with minimal infrastructure needs and maintenance costs. Economic logic thus suggests that a share of the budget should be allocated to the promotion of domestic capabilities and production of military equipment at home — a policy that would both decrease the unemployment rate and boost the country’s missile technology in the future.

Buying warplanes from a foreign country would result in permanent dependence. In this case, there is a risk that the seller would, during wartime, refuse to supply the country with the required spare parts or the related arms or make the necessary upgrades. In a potentially fatal scenario, the provider may also betray the customer and sell the enemy all the sensitive data on the features and avionics of the aircraft.

Given the economic efficiency of stockpiling missiles instead of purchasing fighter jets as well as the job opportunities that would be created by such an agenda, it is not beyond expectation that Iran would achieve a huge arsenal of missiles in the future.

The Islamic Republic’s underground missile cities are proof of the country’s wise and vast investments in building and storing ballistic missiles while keeping the arms operational. For such a state as Iran, which faces serious threats from big regional and international powers, it is natural to possess some 5,000 to 10,000 ballistic missiles, especially when the arsenal is meant to cover the Air Force’s weaknesses.

A look at the lavish purchases of advanced warplanes by Persian Gulf littoral Arab states and their stockpiling of over 1,200 state-of-the-art mid-range cruise missiles made in Europe and the US makes it clear that Iran has an obligation to fortify its defenses by reaching the same levels.

The growth in the defense industry has helped Iran strengthen its capabilities to build missile defense systems. The country has also managed to acquire the technology to produce offensive military hardware — such as cruise missile, jet-powered drones, and smart bombs — and successfully paved the ground for the promotion of endogenous artificial intelligence. These achievements herald a hopeful future, in which infrastructure could be created to facilitate further advances in aerospace technology with the aim of decreasing the costs and increasing the quality of productions in this field in line with the country’s economic efficiency agenda. This path of progress could also set the stage for Iran’s Armed Forces to develop sixth-generation unmanned aerial vehicles (UAV).


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