Tension in the Asia-Pacific: Iranian-Malaysian Relations and the West

Iran’s geopolitical relationships within the Middle East have been a constant feature of recent political analysis. However, as the Asia-Pacific becomes a region of increasing strategic importance for the West and China, attention should be paid to the possible implications of Iran’s relationships in Southeast Asia.

The Iranian-Malaysian relationship, in particular, is significant in terms of its implications for the West, because of fears that the increasing scale of migration from Iran to Malaysia and the growing economic ties between these two countries could lay the foundations for a clandestine base for Iran to pursue its goals in Southeast Asia. Indeed, despite unrelenting foreign condemnation, Malaysia has consistently fostered a co-operative relationship with the Islamic Republic in areas such as energy development, economic relations and security. Its support even stretches to one of the biggest taboos of international politics: Iran’s nuclear weapons programme, with the Secretary General of Malaysia’s Ministry of Foreign Affairs Mohd Radzi bin Abdul Rahman reaffirming the country’s support for Iran’s right to use nuclear energy for peaceful purposes in May.

However, Western concerns about the potential implications of such close ties may be premature, with cracks already beginning to show in the relationship between Iran and its Southeast Asian ally.

There are two reasons for this deterioration: first, the weight of the omnipresent pressure of the international community calling for Iran to strictly adhere to the Nuclear Non- Proliferation Treaty; and secondly, the growing insecurity of the Malaysian regime regarding its own Sunni population, which it fears could be corrupted by the Shia beliefs of Iranian immigrants. While the former, as shown, has not deterred Malaysia from officially reiterating its support for Iran’s nuclear rights, the latter – religious insecurity – has had a greater impact on the two countries’ relations.

The basis of this religious insecurity is both historical and contemporary. The codification, since the country gained independence in 1957, of Islamic practice and racial identity within the constitution provides an intriguing example of the incorporation of identity politics into constitutional law, with the inclusion of a racial element resulting from the multicultural character of the country. While Malaysia’s mixture of ethnic Malays, Chinese and Indians has its benefits, it also creates an environment of organisational insecurity for the largest political party in the ruling coalition – the United Malays National Organization (UMNO) – which, in a bid to maintain dominance, has pursued the dual goals of preserving ethnic Malay culture and protecting and expanding Islam.

The latter has been achieved through the consolidation of Article 160 of the Malaysian constitution, which states that, without exception, all ethnic Malays – also known as Bumiputras – are Muslims, and that any Malay choosing not to be a Muslim would automatically surrender his or her ethnic status. This would in turn strip them of the economic benefits of their nationality under the New Economic Policy (1971) and the National Development Policy (1991) – policies aimed at increasing the ratio of economic ownership in favour of Malays; for example, by setting aside 30 per cent of initial public offerings (IPOs) for Bumiputras. Although these formal advantages have waned over the years, the preference for Malay investment has become engrained in Malaysia’s domestic economics. It is thus unsurprising that the Sunni Islamic majority in Malaysia continues to represent a steady 61 per cent of the population.

The UMNO’s broad goal of preserving Sunni Islam in tandem with strict racially based legislation on religion has resulted in an approach to Iranian immigration that attempts to align two contradictory strands: the government permits the immigration of predominantly Shia Iranians into the country but, at the same time, insists that Malays do not stray from their Sunni roots. The effects of this tension between the two policies goes some way towards explaining Malaysia’s changing stance on Iran, especially given the scale upon which Iranian immigration has pervaded Malaysian society.

In 2011, the Iranian Embassy in Malaysia stated that 70,000 Iranians were studying or working in, or waiting for visas to, Malaysia. According to Malaysia’s Ministry of Tourism, 130,000 Iranian tourists visited in the same year, with Iranians also representing the biggest group of participants in the ‘My Second Home’ programme – a government-promoted initiative that allows foreigners to stay in Malaysia for as long as possible on a social visit pass, provided they fulfil certain criteria.

Significantly, and largely as a result of this, Iranian economic ties to Malaysia have also grown. Within Malaysia, Iranians now hold shares in more than 2,000 companies and bilateral trade is blossoming: in an interview in June, Iran’s attaché stated that Iran exported products worth $500 million to Malaysia in 2011.

It is the presence of this influential Iranian diaspora that marks the difference between Iran’s relationship with Malaysia and the latter’s neighbour Indonesia, which has the largest Muslim (predominantly Sunni) population in the world and Southeast Asia’s largest economy. In terms of political relations, Indonesia’s approach to Iran is similar to that of Malaysia: the government supports Iran’s right to develop a nuclear programme, bilateral trade between the two states is well-established, and they have acknowledged each other as key players within the Islamic world. However, in terms of being a detination for Iranian emigration Indonesia falls behind Malaysia. Although Iranian tourists are easily granted visas to Indonesia, many Iranians immigrants attempt to enter Indonesia illegally via its ports; as a result, the deportation of Iranians by the Indonesian government has routinely made headlines.

Malaysia has traditionally been more welcoming of Iranian immigration and its attendant economic benefits than its larger neighbour. However, it is primarily this remarkable scale of Iranian immigration that underpins the unprecedented volatility that has come to characterise Iran’s relationship with Malaysia in recent years. While the practice of Shia Islam has for some time been illegal in Malaysia, the UMNO’s increasing concern about the Shia threat has manifested itself in the growing oppression of both Iranian immigrants and Malaysians sympathetic to Shia Islam. Despite the presentation of petitions by the Shia community to the government-backed Human Rights Commission regarding its right to practice its religion, Shia Islam is still considered an illegal sect, denied an official place of worship.

It is possible that the animosity towards Shias by the Malaysian government has been exacerbated by the current political situation in Malaysia, which has reached a critical point during the election year of 2012. In the last elections, the ruling coalition Barisan Nasional – which has ruled Malaysia since independence – did uncharacteristically badly, as it did not win a two-thirds supermajority in the Malaysian parliament for the first time since 1969. This has made UMNO increasingly uncertain of its position as the dominant party in Malaysia, as the success of Barisan Nasional also reflects the popularity of UMNO which, together with the Malaysian Chinese Association and the Malaysian Indian Congress, makes up a majority of the coalition’s seats – while every single chairman of Barisan Nasional, and thus prime minister of Malaysia, has been an UMNO member. The decreasing popularity of UMNO among its voters, who are mainly Sunni Malays, may help to explain the increased governmental persecution of Shia Muslims, spawned from a fear that UMNO is losing control over its traditional voting pool.

Another source of UMNO’s insecurity has been the Bersih (‘clean’) protests that have plagued Malaysia for the past year. Widespread public dissent is rare in Malaysia, but the protests by an estimated 20,000 people on 7 July 2011 gained international attention and highlighted the public’s opposition to the habitual corruption tainting Malaysian elections – an effect reinforced by the repetition of the protests, with another rally taking place in March 2012, in which 25,000 people marched against the government despite a police clampdown in 2011. In combination with decreasing electoral clout, the Bersih protests have made the Malaysian government unsure of its core Sunni Malay supporters, heightening concern about the impact of the corrupting presence of Shia Islam on its already waning support. 

Yet probably the most significant factor underlying the uncomfortable reaction of the Malay government to Iranian immigration is the hostile nature of the relationship itself between Sunni and Shia Islam. The UMNO’s long-standing insistence upon the legality of Sunni Islam alone, combined with the party’s growing sense of insecurity in the run-up to elections, is creating an environment in which this historic religious split takes on greater significance and is likely to weaken Iran’s long-term influence in Southeast Asia. A narrative of fear of the destabilising ‘other’, long a characteristic of the Sunni-Shia schism in Iran’s immediate neighbourhood of the Middle East, has, therefore, become a feature of the underlying organisational insecurity of the Malaysian government.

The implications for the West of such strains in the relationship between these two countries, and the factors underlying them, are significant: from a strategic security perspective, it is in Western interests that the alliance between Iran and Malaysia deteriorates. If Iran is able to transform Malaysia into a base for its activities in Southeast Asia, it will be able to influence to a greater degree the conflict and insurgency in southern Thailand, the situation affecting the persecuted Muslim Rohingyas in Myanmar and the Christian-Muslim conflict in Indonesia. In short, Malaysia has the potential to act as the perfect base for Iran to engage in proxy conflicts in pursuit of its aim to become the de facto defender of the Islamic world, and to establish itself as a potent force in an area of growing significance to international power politics.

At present, Malaysia’s internal politics and the Sunni-Shia split have contributed to the mitigation of such a possibility, a fact that favours Western interests insofar as it helps to contain Iranian influence in the region. On top of this, two particularly significant developments this year have further served to benefit the West’s attempts to isolate Iran. First, in March, Malaysia took the decision to halt oil imports from Iran in order to avoid US sanctions. Secondly, in June, a Malaysian court approved the extradition of an Iranian to Thailand over his alleged involvement in a bomb plot targeting Israeli officials. This act was particularly significant because Malaysia does not maintain formal diplomatic relations with Israel, thus it was uncharacteristic of the Malaysian judicial system to make a decision that entailed some degree of co-operation with Israeli officials. This act should not, however, be seen as warmth to Israel; rather, it is a move away from protecting Iran by increasing Malaysia’s adherence to international norms.

However, if the West wants to rely less heavily upon the Malaysian government’s aggressive defence of its Sunni population and the diplomatic problems that have historically curtailed Sunni-Shia co-operation, then the Iranian threat in Southeast Asia must be countered through more direct means. Thus far, efforts by Western governments have focused predominantly on attempting to redress China’s dominance in the region – Britain through increasing its diplomatic relations within the region, and America through the adoption of a more militaristic stance. Yet the potential for an expanded Iranian presence in Southeast Asia can no longer be ignored and must now become a strategic consideration, informing Western engagement and defensive strategy in the region in its own right.

Zuleika Sedgley
Journalist and author for the New Straits Times, South China Morning Post and Monocle magazine.