Literature Review

This paper’s puzzle sits at the intersection of four debates in international relations and international political economy: the weaponization of interdependence, the fragmented character of Chinese economic statecraft, the indirect forms of great-power competition, and foreign policy approaches. Each captures part of the China-Iran relationship, but each also leaves a residual puzzle that this paper addresses through the concept of indirect strategic enabling. These literatures tend to treat non-delivery as either coercive exclusion, implementation failure, or strategic caution. They are less equipped to explain how limited delivery itself can become a stable form of strategic engagement.

The first cluster of scholarships sits at the systemic level and concerns interdependence and economic coercion. Classical accounts of interdependence emphasized mutual vulnerability and sensitivity, but later work has shown that interdependence is rarely symmetrical. Hirschman (1945) established the foundational insight that trade dependence generates political influence when one side lacks outside options, because the dependent party cannot afford to exit regardless of the terms on offer. Keohane and Nye (1977) similarly distinguished between sensitivity and vulnerability, making clear that the distribution of alternatives matters more than the mere existence of exchange. More recent work on weaponized interdependence sharpens this insight. Farrell and Newman (2019) develop these insights into a theory of weaponized interdependence. They argue that states occupying central positions in global economic networks can exploit “panopticon” and “chokepoint” effects, using informational access or network exclusion as instruments of coercion. States that control central hubs in dollar-clearing, interbank messaging, or global shipping can therefore convert the architecture of economic integration into a tool of geopolitical pressure.

The strength of this literature is that it explains why some forms of exchange become politically unusable. Network power not only stops transactions; it also changes the relative risk of different channels. Activities routed through central financial, legal, or informational infrastructures become more visible and more punishable, while activities outside those infrastructures may become more attractive precisely because they are harder to monitor, enforce against, or attribute. This means that actors facing sanctions do not simply choose between normal exchange and isolation. They choose among channels with different degrees of visibility, legality, institutional protection, and political risk. However, what remains less developed is the process of substitution: how coercion through central hubs reorganizes exchange toward less formal and less transparent channels. Weaponized interdependence identifies the power of the hub; the question left open is how actors adapt around the hub once direct access becomes too costly.

A second cluster of scholarship shifts the level of analysis from global structure to the domestic organization of economic statecraft. Blackwill and Harris (2016) define geoeconomics as the use of economic instruments to pursue geopolitical goals. This perspective is valuable because it rejects a sharp separation between markets and strategy. Yet broad accounts of geoeconomics can imply a smoother conversion of economic capacity into foreign-policy output than is often warranted. Economic instruments are not deployed by “the state” in the abstract. They are mediated through firms, banks, bureaucracies, regulators, and market incentives. The organizational question is therefore central: under what conditions can political leaders convert economic resources into strategic instruments?

Norris (2016) places this problem at the center of Chinese economic statecraft. His principal-agent framework challenges the image of a unified “China Inc.” by showing that commercial actors possess their own interests, risk calculations, and institutional incentives. State-owned firms may be politically embedded, but they are not simply passive instruments of grand strategy. Jones and Zeng (2019) develop a related critique of overly coherent interpretations of the Belt and Road Initiative (BRI). Rather than treating BRI as a single master plan, they understand it as a loose policy framework interpreted and implemented by multiple actors. Ye (2020) similarly emphasizes mobilization, domestic political economy, and institutional fragmentation over simple top-down command. The contribution of this literature is to disaggregate the state. It explains why diplomatic language, memoranda of understanding, and strategic partnership labels do not automatically translate into project delivery.

This literature explains the formal delivery gap better than conventional geoeconomics. It is strongest when explaining implementation gaps: why announced projects stall, why firms avoid risk, and why political signals do not always discipline commercial behavior. Its next analytical step is less developed. If implementation is uneven, what follows politically? Non-delivery may weaken a relationship, but it may also preserve ambiguity by separating symbolic commitment from costly exposure. Fragmentation can be a constraint on state power, but it can also create distance between political signaling and commercial risk. This does not require assuming perfect strategic design. It only requires recognizing that uneven implementation can have effects beyond failure. It can structure expectations, distribute responsibility, and allow limited cooperation to persist without the stronger state fully absorbing the costs of commitment.

The third debate concerns indirect competition. Scholarship on cost-imposition and gray-zone competition argues that states often seek to impose burdens on rivals without triggering direct conflict. Mahnken (2014) conceptualizes cost imposition as a strategy of exploiting an adversary’s vulnerabilities, while Mazarr (2015) describes gray-zone competition as a form of rivalry that relies on ambiguity, incremental pressure, and limited escalation. This literature is valuable because it explains why a great power may benefit from another state’s capacity to distract, drain, or complicate a rival’s strategy without entering a formal conflict itself. It helps make sense of why a disruptive regional actor can be valuable even if it is economically weak or politically costly. The difficulty is that these frameworks often assume a relatively coherent competitive design. They tend to imagine a state orchestrating instruments toward a defined strategic effect. That is appropriate for many cases, but it leaves less room for looser arrangements in which indirect value emerges without comprehensive direction. Not every strategic effect requires command. A state may benefit from another actor’s ability to complicate a rival’s position without controlling that actor or coordinating its behavior. The analytical space between orchestration and indifference remains underdeveloped.

Proxy and surrogate warfare scholarship is useful here, but also limited. Mumford (2013) defines proxy warfare as indirect intervention through local actors, while Berman and Lake (2019), Groh (2019), and Krieg and Rickli (2019) examine how states use local agents, partners, or surrogates to reduce the costs of intervention. The strength of this literature is that it theorizes distance, deniability, and delegation. Its limitation is that the relationship between patron and proxy may be unstable or plagued by agency problems, but it still presumes some form of sponsorship. This leaves less hierarchical forms of support underspecified. A state may help sustain another actor’s capacity without commanding it, integrating it, or assuming responsibility for its conduct.

A fourth cluster concerns foreign-policy hedging and strategic ambiguity. Hedging scholarship explains how states manage uncertainty without entering firm alignments. Goh (2005) and Kuik (2008) show that states may preserve flexibility by cultivating multiple relationships, avoiding irreversible commitments, and combining elements of cooperation, distancing, and limited balancing. Hedging is a strategy of ambiguity under uncertainty, designed to preserve options when the future distribution of power, threat, or opportunity remains unclear. This literature is useful because it treats ambiguity as a deliberate posture rather than a sign of indecision or a failing relationship. It can explain why states deepen cooperation with partners while still avoiding binding commitments. Hedging tells us why actors avoid exclusive alignment, but it says less about how relationships short of alignment generate value in practice. A state may keep several doors open, but the literature does not always specify what passes through those doors. To explain shallow but durable cooperation, hedging must be paired with an account of the channels through which non-commitment becomes operationally meaningful.

South-South cooperation literature shows why China’s rhetoric matters: emerging powers often frame development cooperation as horizontal, sovereignty-respecting, infrastructure-oriented, and based on mutual benefit rather than Western-style conditionality (Mawdsley 2012; Chin and Quadir 2012). China draws heavily on this language, presenting itself as a developing-country partner committed to non-interference, equality, and mutual benefit rather than as a traditional donor (Murphy 2022; MFA PRC 2003). Importantly, however, this discourse does not necessarily promise patronage or delivery at scale. It legitimates political closeness while remaining largely agnostic about the pace, enforceability, and material depth of implementation. In the China-Iran case, the language of mutual benefit is therefore not simply contradicted by limited investment; it is well suited to a relationship in which symbolic partnership and material restraint coexist.

Finally, the Iranian-side foreign policy literature is also useful here. Zamirirad (2020) shows that the “East” in Iranian foreign policy is rather an ideological, anti-hegemonic, and at times anti-Western space. Yet she also argues that after the U.S. withdrawal from the JCPOA in 2018, an eastern orientation shifted from one foreign-policy option among others into something closer to a strategic necessity. Perletta (2025) provides the deeper historical frame for this claim. By tracing Iran’s movement from revolutionary non-alignment to “Look to the East,” she shows that ideology and pragmatism are not opposite logics in Iranian foreign policy but interwoven strategies of regime survival. Iran’s eastward turn is therefore not simply a reactive adjustment to sanctions, nor a pure expression of anti-Western ideology. It is a historically layered attempt to reconcile independence, resistance to Western domination, economic necessity, and survival. Jalilvand (2020) argues that Asia is a natural destination for Iranian energy, but sanctions have made Iran’s embrace of Asian markets more difficult and have allowed Asian firms to demand tougher commercial terms. Forough (2020), by contrast, emphasizes the ideational fit between Iran’s self-image as a Eurasian crossroads and China’s Belt and Road imaginary. Taken together, these works show that Look East is best understood as a hybrid orientation shaped by revolutionary identity, sanctions pressure, energy-market geography, and the search for diplomatic protection.

The causal problem, however, is more complicated than a linear movement from sanctions to eastward alignment. Sanctions are not merely an external constraint imposed on an otherwise neutral foreign policy field. They are also partly endogenous to Iran’s revolutionary identity, nuclear posture, regional strategy, and conflictual relationship with the West. This does not reduce sanctions to Iranian ideology or deny the independent role of U.S. policy. It means that “Look East” should not be treated only as an adaptation to constraint. It is also a way of sustaining a foreign-policy identity in which autonomy, resistance to Western dominance, and regime survival remain linked. Perletta’s formulation is especially useful here because it avoids the false choice between ideology and pragmatism: the eastward turn is pragmatic, but it is made intelligible through ideological narratives of independence and anti-domination.

From the Chinese side, Fulton (2022) shows this posture at work in China's Middle East policy: Iran is not its center, and Beijing maintains a wider Gulf portfolio of competing relationships rather than an exclusive partner in Tehran. Yet a portfolio reading accounts, at most, for what Beijing withholds. It does not explain why Iran-specific channels of oil purchases, diplomatic cover, and security-relevant access are actively sustained.

Theory: Indirect Strategic Enabling

None of these four literatures above explains how selective and limited delivery could become a durable feature of the relationship, sustained rather than resolved. I use indirect strategic enabling to describe a mode of great power statecraft in which a state sustains the resilience and strategic usefulness of a partner without assuming formal responsibility for that partner's conduct or survival. Each of its three components does the analytical work.

The support is indirect because it flows through small, replaceable, and commercially insulated actors rather than through state-owned enterprises, formal bilateral programs, or visible diplomatic commitments. The Chinese state neither commands nor openly funds these channels. It tolerates and shields them. This means the relationship cannot be tracked through the instruments that normally make engagement legible, such as FDI, bilateral loan records, SOE investments, or formal security agreements. The indirection is not incidental. It is what allows the arrangement to persist under conditions that would make direct engagement prohibitively costly.

The support is strategic because it serves systemic great power competition goals regardless of whether it is centrally coordinated. A partner that remains economically afloat, regionally active, and capable of complicating US strategy in the Middle East generates value for China whether or not Beijing actively directs that outcome. The mechanism does not require deliberate orchestration to be effective. It requires only that the enabling state be permissive toward channels that produce strategically useful effects, and that it does not absorb the costs those effects impose on the target.

The support is enabling rather than directing. China enables through oil purchases, diplomatic cover at the UN Security Council, and access to commercial and dual-use civilian-military networks and commodities that support Iranian capacity and regime survival without determining Iranian behavior. This distinguishes indirect strategic enabling from proxy warfare, which assumes an agency relationship in which the sponsor shapes a partner's conduct toward specific objectives. Iran is not directed by Beijing. It is kept capable and solvent by Beijing, which is a different and lower-cost commitment.

Together, these features produce a relationship that works on two levels. The formal architecture of the partnership, from the 25-year agreement to the language of comprehensive strategic cooperation, is largely symbolic: it legitimates the relationship at home and abroad without requiring material fulfillment. What actually sustains the relationship is quieter. Oil revenue keeps the Iranian economy running, diplomatic cover limits Iran's isolation, and commercial networks provide security-relevant access. This is also where the strategic payoff lies. An Iran kept solvent through these channels remains capable of occupying American attention and imposing costs on Washington, and Beijing pays almost nothing for it.

This logic represents a structural departure from the two dominant models of great-power competition that preceded it. Soviet patronage in the Cold War was defined by visible and costly burden-bearing: Moscow armed, trained, funded, and in several cases directly intervened to sustain partners in Angola, Cuba, Afghanistan, and Vietnam (Westad 2005; Gaiduk 1996; Gleijeses 2013; Kalinovsky 2011). The costs were constitutive, since Soviet credibility as a patron depended on its demonstrated willingness to absorb them. American alliance management follows a parallel, though institutionally distinct, logic. Article 5 commitments, forward basing, extended nuclear deterrence, and security guarantees derive much of their value from being costly, visible, and difficult to abandon (Schelling 1966; Jervis 1970; Huth 1988; Morrow 1994, 2000; Snyder 1997). In both models, influence is purchased through exposure. Indirect strategic enabling reconfigures this relationship. Beijing’s relationship with Iran generates strategic benefits through trade, diplomatic cover, sanctions circumvention, and selective technological or infrastructural cooperation, but without the binding security obligations or direct burden-bearing associated with Soviet patronage or American alliance management (Garver 2006; Alterman and Garver 2008; Harold and Nader 2012; Scobell and Nader 2016; Fulton 2019). Deniability is therefore not a limitation on Chinese influence. It is the condition that makes the arrangement sustainable.

Empirical Analysis: Structural Pattern of Indirect Strategic Enabling in China-Iran Relations, 2005-2026

This section reconstructs the macro-level architecture of the China–Iran relationship through systematic process tracing. Following established standards in qualitative causal inference, the analysis employs three diagnostic tests to adjudicate among competing explanations: a hoop test for the sanctions-only account (the JCPOA relief window), sequence and timing tests for principal-agent fragmentation (divergences between political signaling and commercially exposed actors), and a crisis probe for commitment boundaries (the 2026 Iran war). Evidence is drawn from investment trackers, trade data, project-level reporting, diplomatic records, UN Security Council documents, and sanctions designations.

The evidence reveals a consistent pattern: Beijing repeatedly strengthened the formal framework of partnership while keeping material commitments in high-risk areas limited. Lower-visibility channels (mainly oil purchases through independent refiners, diplomatic protection, and selective commercial networks) kept Iran economically viable and strategically useful. This combination fits indirect strategic enabling better than sanctions constraints, principal-agent fragmentation, or hedging alone.

Foundations and the Look East Period, 2005-2015

The empirical analysis begins in 2005 because this year marks the election of President Mahmoud Ahmadinejad and the explicit articulation and intensification of Iran’s “Look to the East” (Negah be Sharq) doctrine. While commercial and diplomatic contacts between Tehran and Beijing predated this period, 2005 represents the qualitative shift in which the relationship acquired its distinctive ideological, anti-hegemonic, and sanctions-adapted character that is the central object of this study. UN Security Council Resolutions 1737 (2006) and 1929 (2010) imposed the first major multilateral sanctions tied to the nuclear program, narrowing Iran’s access to Western finance and technology while creating the structural conditions under which channel selection would later become decisive (United Nations 2006, 2010). Chinese engagement combined diplomatic cover at the UN with selective commercial involvement (primarily CNPC contracts at South Pars and Yadavaran) without assuming the role of primary patron or development financier (MFA PRC 2016). Even in this relatively open period, announced Chinese commitments repeatedly underperformed: project timelines slipped, financing gaps emerged, and SOEs demonstrated persistent reluctance to absorb full contractual exposure. Even before explicit secondary sanctions, U.S. control of dollar-clearing and SWIFT systems already shaped Chinese risk calculations (Farrell and Newman 2019). This early phase sets the baseline for later divergence.

The JCPOA Window as Hoop Test, 2015-2018

The JCPOA years provide the decisive hoop test for sanctions-only explanations. Resolution 2231 (2015) lifted multilateral sanctions and opened space for European firms, which duly returned to Tehran (United Nations 2015). If sanctions were the sole barrier, Chinese investment and project delivery should have surged. They did not. Xi Jinping’s January 2016 visit to Tehran featured ambitious trade targets and a Belt and Road memorandum, a significant diplomatic push (MFA PRC 2016). Yet cumulative Chinese FDI and construction contracts showed no measurable increase. By 2025, total verified Chinese investment in Iran since 2007 stood at under $5 billion, covering the entire period including the relief window (Reuters 2025; AEI China Global Investment Tracker 2025). This outcome rules out sanctions as a sufficient explanation. SOE caution is consistent with principal-agent dynamics, but it cannot account for Beijing’s decision to expand the partnership framework precisely when large-scale delivery was most feasible.

Conclusion

The China-Iran relationship is a low-commitment, high-utility arrangement in which Beijing helps sustain Iran's economic resilience and strategic disruptiveness without assuming the visible costs or binding obligations of patronage or alliance. The gap between rhetorical partnership and material delivery is not merely an implementation failure. It is part of how indirect strategic enabling works: discounted oil purchases, diplomatic shielding, and commercially mediated security-relevant channels allow Iran to remain economically afloat and regionally active while China limits its exposure. The 2026 war clarified this logic. While refusing direct military involvement, Beijing continued its purchases of Iranian oil and tolerated the flow of dual-use technology and components, enabling Iran to sustain a conflict that strained US missile and interceptor inventories and diverted American attention from the Indo-Pacific, all without bearing significant costs (Cancian and Park 2026; AP 2026).

The China-Iran case thus reveals an important feature of contemporary great-power competition with Chinese characteristics. Unlike Soviet patronage, which often purchased influence through costly and visible burden-sharing, or American alliance management, which relies on expensive security guarantees, Beijing’s approach can operate through selective, deniable, and asymmetric enabling. Russia offers a plausible future comparative case as NATO has described China as a “decisive enabler” of Russia’s war effort, while Western support for Ukraine has strained weapons stocks and distracted U.S. strategic attention (NATO 2024; Guardian 2024). China’s broader pattern is leaning towards influence through distance, ambiguity, and functional support rather than institutionalized and risky obligations.