Narcotics Control Strategy Report

2005 Volume I: Drug and Chemical Control

I. Summary

The Islamic Republic of Iran is a major transit route for opiates smuggled from Afghanistan and through Pakistan to the Persian Gulf, Turkey, Russia, and Europe. There is no evidence that narcotics transiting Iran reach the United States in an amount sufficient to have a significant effect. Iran is no longer a major drug producing country. Trafficking routes for opiates from Afghanistan to Russia and beyond, by way of Central Asia, have grown in importance, but the largest single share of opiates leaving Afghanistan still passes through Iran to consumers in Russia and Europe. There are also an estimated 2 million opiate abusers in Iran, with 60 percent reported as addicted to various opiates and 40 percent reported as casual users.

There is overwhelming evidence of Iran’s strong commitment to keep drugs leaving Afghanistan from reaching its citizens. As Iran strives to achieve this goal, it also prevents drugs from reaching markets in the West. Three thousand two hundred Iranian law enforcement personnel have died in clashes with heavily armed drug traffickers over the last two decades, and Iran reports that another 25 died in the first half of 2004. Iran spends a significant amount on drug-related expenses, including interdiction efforts and treatment/prevention education. Estimates range from $250-$300 million to as much as $800 million each year, depending on whether treatment and other social costs are included. Traffickers from Afghanistan continue to cause major disruption along Iran’s eastern border, but Iranian security forces seem to be having increased success by concentrating their interdiction efforts in the eastern provinces.

Iran has ratified the 1988 UN Drug Convention, but its laws do not bring it completely into compliance with the Convention. The United Nations Office of Drug Control (UNODC) is working with Iran to modify its laws, train the judiciary, and improve the court system.

II. Status of Country

Iran is a transit country and a major consumer country of opiates and hashish. Entering from Afghanistan and Pakistan into eastern Iran, heroin, opium, and morphine are smuggled overland, usually to Turkey. Another route to Europe and Turkey passes by way of Turkmenistan, Armenia, and Azerbaijan. Drugs are also smuggled by sea across the Persian Gulf. Iran is also a major opiate consuming country, with the highest share of population abusing opiates in the world. The UNODC estimates that 2.8 percent of the Iranian population over age 15 used opiates in 2001 (latest data available).

III. Country Actions Against Drugs in 2004

Policy Initiatives. Iran is spending at least 50 percent of its budgeted counter drug expenditures on demand reduction activities, a significant shift from recent expenditure patterns where most funds went for enforcement-related supply reduction. The shift seems to be a clear response to the growing social and health impact of more dangerous drug abuse (e.g., heroin vice opium) and the trend towards more intravenous heroin abuse, with certain addict populations sharing needles. Police forces engaged in narcotics suppression activities have begun to complain publicly that their budgets are inadequate for their interdiction responsibilities.

Law Enforcement Efforts. The Drug Control Headquarters coordinates the drug-related activities of the police, the Islamic Revolutionary Guard Corps, and the Ministries of Intelligence and Security, Health, and Islamic Guidance and Education.

Iran pursues an aggressive border interdiction effort. A senior Iranian official told the UNODC that Iran had invested as much as $800 million in a system of mud walls, moats, concrete dams, sentry points, and observation towers, as well as a road along its entire eastern border with Pakistan and Afghanistan. According to an official GOI Internet site, Iran has installed 212 border posts, 205 observation posts, 22 concrete barriers, 290 km of canals (depth-4m, width-5m), 659 km of soil embankments, a 78 km barbed wire fence, and 2645 km of asphalt and gravel roads. It also has relocated numerous border villages to newly constructed sites, so that their inhabitants are less subject to harassment by narcotics traffickers.

Thirty thousand law enforcement personnel are regularly deployed along Iran’s border with Afghanistan and Pakistan. Interdiction efforts by the police and the Revolutionary Guards have resulted in numerous drug seizures. Iranian officials seized 181 metric tons (MT) of opiates (opium equivalent) just during the first six months of 2004. Opiate seizures in 2004 (projected) were on track to exceed those in 2003 by 48 percent. These increases are likely to continue as Afghanistan’s largest opium harvest ever moves towards markets in Iran itself, and in the West. Iran is likely to remain the country with the highest volume of opiate seizures in the world.

Iranian opiate seizures in the first six months of 2004 display some interesting trends:

• Unrefined (raw) opium seizures increased sharply;
• Heroin was only 14 percent of all opiates seized, a surprisingly small share of the total;
• The morphine base share of seized drugs was also down from recent years to 39 percent of the total.

One possible explanation for these seizure trends is a return of Iranian addicts to traditional raw opium abuse, after a period when disruptions in supply from Afghanistan forced a switch to heroin. A large share of heroin and almost all of the morphine base transiting Iran is headed for markets in Europe (heroin) or for further refining in Turkey (morphine base).

Hashish seizures in Iran in the first six months of 2004 were on track to exceed seizures registered last year by a wide margin. At slightly more than 49.5 metric tons, only raw, unrefined opium seizures at 85 metric tons exceed hashish seizures in volume.

Drug offenses are under the jurisdiction of the Revolutionary Courts. Punishment for narcotics offenses is severe, with death sentences possible for possession of more than 30 grams of heroin or five kilograms (kg) of opium. Those convicted of lesser offenses may be punished with imprisonment, fines, or lashings, although it is believed that lashings have been used less frequently in recent years. Offenders between the ages of 16 and 18 are afforded some leniency. More than 60 percent of the inmates in Iranian prisons are incarcerated for drug offenses, ranging from use to trafficking. Narcotics-related arrests in Iran during the first six months of 2004 continued a sharp upward trend, mounting to 196,555. Almost three times more drug abusers were detained than drug traffickers. Iran has executed more than 10,000 narcotics traffickers in the last decade.

Corruption. Although there is no indication that senior government officials aid or abet narcotics traffickers, there are reports of corruption among lower/mid-level law enforcement, which is consistent with the transit of multiple-ton drug shipments across Iran. Punishment of corruption is harsh, and the evidence of Iran’s commitment to keep drugs from its people is compelling. Iran points to its drug interdiction efforts as benefiting countries in Western Europe and beyond.

Agreements and Treaties. Iran is a party to the 1988 UN Drug Convention; however, its legislation does not bring it completely into compliance with the Convention, particularly in the areas of money laundering and controlled deliveries. The UNODC is working with Iran through the NOROUZ Program to modify its laws, train the judiciary, and improve the court system. Iran is also a party to the 1971 UN Convention on Psychotropic Substance, the 1961 UN Single Convention and the 1972 Protocol. Iran has signed, but has not yet ratified, the UN Convention on Transnational Organized Crime, and is a signatory to the UN Convention Against Corruption. Iran has shown an increasing desire to cooperate with the international community on counternarcotics matters. Iran is an active participant in the Paris Pact, a group of countries that actively seeks to coordinate efforts to counter opiate smuggling in Southwest Asia, and Iran is scheduled to host an expert round table of this group in 2005.

Cultivation/Production. A 1998 U.S. survey of opium poppy cultivation in Iran and a detailed U.S. multi-agency assessment concluded that the amount of poppy being grown in Iran was negligible. The survey studied more than 1.25 million acres in Iran’s traditional poppy-growing areas, and found no poppy crops growing there, although the survey could not rule out the possibility of some cultivation in remote areas. A follow-up survey in 1999 reached the same conclusion. Iran is now generally viewed as a transit country for drugs produced elsewhere, but there are some reports of opium refining near the Turkish/Iranian border. Most refining of the opiates moving through Iran is done elsewhere, either in Afghanistan or in Turkey.

Drug Flow/Transit. Shipments of opiates enter Iran overland from Pakistan and Afghanistan by camel, donkey, or truck caravans, often organized and protected by heavily armed ethnic Baloch tribesmen from either side of the frontier. Once inside Iran, large shipments are either concealed within ordinary commercial truck cargoes or broken down into smaller sub-shipments. The Iranian town of Zahedan is reportedly a center for the opiate trade as it first enters Iran, and then moves westward. Foreign embassy observers report that Iranian interdiction efforts have disrupted smuggling convoys sufficiently to force smugglers to change tactics and emphasize concealment more than they have in the past. The use of human "mules" is on the rise. Individuals and small groups also attempt to cross the border with two to ten kilograms of drugs, in many cases ingested for concealment. Trafficking through Iran’s airports also appears to be on the rise. Still, many traffickers move drugs in large armed convoys, and are ready for a fight if challenged.

Most of the opiates smuggled into Iran from Afghanistan are smuggled to neighboring countries for further processing and transportation to Europe. Turkey is the main processing destination for these opiates, most of which are bound for consumption in Russia and Europe. Essentially all of the morphine base, which represents almost 40 percent of all opiates seized in the first six months of 2004, in Iran, is likely moving towards Turkey, as is some share of the much diminished 14 percent, or so, of opiates moving as heroin. Significant quantities of raw opium are consumed in Iran itself, but some share also moves on to the west to be refined and consumed as heroin in Europe and elsewhere. There is a northern smuggling route through Iran’s Khorasan Province, to Turkmenistan, to Tehran, and then on to Turkey. The mountains, desert, sparse population along this route make it hard to police. Traffickers are frequently well armed and dangerous.

The southern route also passes through sparsely settled desert terrain on its way to Tehran en route to Turkey; some opiates moving along the southern route detour to Bandar Abbas and move by sea to the Persian Gulf states. Bandar Abbas also appears to be an entry point for precursor chemicals moving to refineries in Afghanistan. Iran does not specifically control precursor chemicals used for producing illicit drugs, but has made a number of important seizures, mostly at Bandar, of acetic anhydride, used in the refining of heroin. All precursor chemicals seized were consigned to Afghanistan. Trafficking through Iran is facilitated by wide spread smuggling to provide necessities, and to escape high taxation. There are reports that enforcement authorities accept bribes to pass shipments, and fail to enforce laws against street sales inside of Iran.

Azerbaijan and Armenia provide alternative routes to Russia and Europe that bypass Turkish interdiction efforts. Additionally, despite the risk of severe punishment, marine transport is used through the Persian Gulf to the nations of the Arabian Peninsula, taking advantage of modern transportation and communication facilities and a laissez-faire commercial attitude in that area. Hashish moves extensively along this route, as well. Oman and Dubai appear to be important destinations, but some Iranian hashish even finds its way to Iraq. Iranian enforcement officials have estimated that as much as 50 percent of the opium produced in Afghanistan in past years entered Iran, with as much as 700-800 metric tons of opium consumed in Iran itself by its ca. 2 million users.

Domestic Programs (Demand Reduction). Smoked opium is the traditional drug of abuse in Iran, but opium is also drunk, dissolved in tea. Opium and its residue are also injected, dissolved in water, by a small number of addicts. Iranians have clearly been using more heroin during the past several years. Heroin has not replaced opium, the traditional drug of choice in Iran, but lower street prices for heroin, and temporary shortages of opium, after the Taliban successfully prohibited opium production in Afghanistan for one year (2000/01), plus higher prices for opium, have encouraged some addicts to switch from opium to heroin. Some heroin is smoked or sniffed, but a growing share is injected.

Ninety-three percent of opiate addicts are male, with a mean age of 33.6 years (plus or minus 10.5 years), and 1.4 percent (about 21,000) are HIV positive. In the past, the Islamic Republic attacked illegal alcohol use with more fervor than drug abuse, and was reluctant to discuss drug problems openly. Since 1995, public awareness campaigns and attention by two successive Iranian presidents as well as cabinet ministers and the Parliament have given demand reduction a significant boost. Under the UNODC’s NOROUZ narcotics assistance project, the GOI spent more than $68 million dollars in the first year for demand reduction and community awareness. The Prevention Department of Iran’s Social Welfare Association runs 12 treatment and rehabilitation centers, as well as 39 out-patient treatment programs in all major cities. Eighty-eight out-patient treatment centers are now operational. Some 30,000 people are treated per year, and some programs have three-month waiting lists. Narcotics Anonymous and other self-help programs can be found in almost all districts, as well, and several NGOs focus on drug demand reduction. There are no methadone treatment or HIV prevention programs, although HIV infection in the prison population is a serious concern.

IV. U.S. Policy Initiatives and Programs

Policy Initiatives. In the absence of direct diplomatic relations with Iran, the United States has no narcotics initiatives in Iran. The U.S. government continues to encourage regional cooperation against narcotics trafficking. Iran and the United States have expressed similar viewpoints on illicit drugs and the regional impact of the Afghan drug trade. In the context of multilateral settings such as the UN’s Paris Pact group, the United States and Iran have worked together productively. Iran nominated the United States to be coordinator of an earlier UN-sponsored coordination effort on narcotics called the "Six Plus Two" counternarcotics initiative.

The Road Ahead. The GOI has demonstrated sustained national political will and taken strong measures against illicit narcotics, including cooperation with the international community. Iran’s actions support the global effort against international drug trafficking. Iran stands to be one of the major benefactors of any long-term reduction in drug production/trafficking from Afghanistan, as it is one of the biggest victims of the short term increase in opium/heroin production there now. The United States anticipates that Iran will continue to pursue policies and actions in support of efforts to combat drug production and trafficking.

The U.S. Department of State has designated Iran as a State Sponsor of Terrorism. Iran is not a regional financial center. Iran has a robust underground economy and the use of alternative remittance systems to launder money is widespread. The underground economy is spurred—in part—by attempts to avoid restrictive taxation. In 2003, a prominent Iranian banking official was quoted as estimating that money laundering encompasses 20 percent of Iran’s economy and that the under-development of financial institutions leads to an imbalance in financial markets causing underground financial activities to flourish. Further, Iran’s real estate market is used to launder money. Real estate transactions take place in Iran, but often no funds change hands there; rather, payment is made overseas. This is typically done because of the difficulty in transferring funds out of Iran and the weakness of Iran’s currency, the rial.

Hawala is also used to transfer value to and from Iran. Factors contributing to the widespread use of hawala are currency exchange restrictions and the large number of Iranian expatriates. The smuggling of goods into Afghanistan from Iran leads to a significant amount of trade-based money laundering. Goods purchased in Dubai are sent to one of many ports in southern Iran and then via land routes to other markets in Afghanistan and Pakistan. The goods imported into Iran and sent into Afghanistan are often part of the Afghan Transit Trade. Many of these goods are eventually found on the regional black markets. Iran is also a major transit route for opiates smuggled from Afghanistan.

In 2003, the Majlis (Parliament) passed an anti-money laundering act. The law includes customer identification requirements, mandatory record keeping for five years after the opening of accounts, and the reporting of suspicious activities. Iran is a party to the 1988 UN Drug Convention and has signed, but not yet ratified, the UN Convention against Transnational Organized Crime.

It does not have a law on terrorist financing. The Government of Iran should construct a viable anti-money laundering and terrorist financing regime that adheres to international standards. It should ratify the UN Convention against Transnational Organized Crime. It should also become a party to the UN International Convention for the Suppression of the Financing of Terrorism. It should not support terrorism or the funding of terrorism.