By Arjun Goswami
Suez Crisis of 1956
The twentieth century Spanish-American philosopher and Harvard Professor George Santayana famously said, “Those who do not learn from history are doomed to repeat it.” As the current conflict around Iran rages, what lessons can be drawn from a Middle Eastern conflict of 70 years?
In 1956 the then British Prime Minister Anthony Eden conspired with the French and Israeli governments to manufacture a false narrative to invade Egypt and take over the Suez Canal – which Egypt’s President Nasser had decided to nationalize. The backdrop to this incident originated in President Nasser’s desire to obtain World Bank funding for building the Aswan dam, which in turn was contingent on US and UK providing their promised shares.
However, the UK Government’s denial of funds had a domino effect – both the US Government and the World Bank refused to provide funds. Faced with this, Nasser’s government decided to charge a passage fee at the Suez Canal to raise funds for what he viewed as a critical development project for Egypt.
Notably, the United States had played no part in the false narrative and invasion. The Republican President Eisenhower had publicly censured the Anglo-French-Israeli invasion and demanded an immediate withdrawal. His administration went well beyond a verbal condemnation – blocking IMF assistance to the UK and threatening to sell off British sterling bonds.
His administration also backed a UN General Assembly resolution for the deployment of UN peacekeeping forces. This resulted in an ignominious withdrawal of Western troops from Egypt in the last gasp of British imperialism.
What are the lessons from the history of Suez?
First, it is that the United Nations and public international law can curtail even major powers. UN General Assembly resolutions backed by the willpower of nation states led to the deployment of UN Emergency Force in Suez, due in part to the neutrality principles entrenched in its charter which were cleverly drafted to overcome the structural handicap of Security Council powers.
It was also in part due to the US’ support for multilateral solutions, which is absent today. To remain relevant, multilateral institutions like the UNGA are in dire need of steadfast support from middle powers.
Second, it appears that successful negotiations require adequate return for concessions. A big reason for the success of Camp David Accords between Egypt and Israel was the substantial military and economic assistance from the US. In the case of Iran, the signing of the Joint Comprehensive Plan of Action (JCPOA) in 2015, did not require lifting of the US’ primary sanctions which cover most bilateral trade in both goods and services.
The US had also ramped up its sanctions from 2016, and its ultimate withdrawal may have only made a case about the JCPOA’s lopsidedness, from Iran’s viewpoint. All of this resulted in a continued build up of ballistic missiles and regional proxies by Iran.
Third, current events might be the biggest test for NATO’s continued existence. The 1956 Suez Crisis was the first major schism which resulted in the passing of the torch from a declining imperial power, namely the UK, to the dominant superpower, namely the US. Consequently, it was not a deep rupture.
Seventy years later, the unity of the Western alliance has been shaken over Greenland, driven by the dominant Western power, namely the US. Not all Western countries are now willing to rally to the call of the US on the Iran conflict.
What should be India’s approach?
One, India has ties with Israel, the Gulf states as well Iran. It could be an effective mediator and galvanize the paralyzed UN system into action. As a strong contributor to UN peacekeeping missions, India could act as a truly honest broker for promoting stability in West Asia.
Two, India’s middle power ambitions above need to be supported by a strong economic presence internationally, by continuing to attract credible foreign investment and not losing out on account of any regional instabilities – for instance the spillover of conflict into the UAE.
India must also begin work to provide political risk insurance (PRI) to its significant outbound investments which are currently exposed, as such insurance is designed specifically to protect against losses arising from war and disruptive sovereign actions.
Collaborating with private and multilateral agencies like Multilateral Investment Guarantee Agency and increasing the financial capabilities of its Export Credit and Guarantee Corporation, to keep market engagement with the Middle East intact, are obvious first steps. It has already been reported that PRI cover will be needed for oil cargo shipments headed through the Strait of Hormuz towards India.
Last, US military prowess has been on clear display in the Iran crisis. But what of global leadership? The US disavowed the UK 70 years ago during the illegal actions in Suez and emerged as a stronger global leader. Today the UK, one of the US’ closest allies, is refusing the call to be Churchillian, referring to international law and perhaps considering the long-lasting consequences of Churchill’s sponsorship of the 1953 coup against the then democratic Iranian government.
This could be India’s moment to take steps to grow its economic power to underpin its work on reinvigorating a reformed, rules-based multilateral word order.
The writer is Director of Public Policy at Cyril Amarchand Mangaldas
Disclaimer: The views expressed are the author’s own and do not reflect the official policy or position of Financial Express.