PHOTO: Iranian President Hassan Rouhani

Continuing his political battle with hardliners within Iran’s regime, President Rouhani has used a televised press conference to make a careful response to the Supreme Leader.

Rouhani covered a wide range of topics on State TV on Saturday, with nuanced comments on the economy and the July 14 nuclear deal.

The President again staked out his authority to lead Iran to economic recovery, defending the Government’s pursuit of foreign investment as part of the strategy:

During my meetings with (foreign) officials, I have clearly said that our policy is that they should bring capital and technology and partner in joint ventures with Iranians so that a part of the markets of Iran, region, and the world will be available to both of us.

Then jobs will be created for our youth.

Some elements within the regime have questioned the extent of foreign involvement in Iran’s economy. In particular, the Revolutionary Guards have indicated their concern about the challenge to their extensive holdings, including large shares of major Iranian companies in areas from engineering to telecommunications.

The Supreme Leader has added his worry that Iran will be “flooded” with foreign goods, squeezing out Iranian producers.

Rouhani responded on Saturday:

I have said many times in the Cabinet meetings that after sanctions if the foreign companies and governments see Iran as an multi-million market, they would be making a mistake.

We should not allow such a thing to happen.

The President also issued a riposte to the Supreme Leader’s repeated declarations that Iran cannot cooperate with the US “enemy” after the July 14 nuclear deal.

Rouhani said Iran will develop its under-construction Arak heavy-water reactor, which was preserved under the deal provided design changes were made to reduce plutonium by-product. He said that the changes would be made with China’s help — and probably that of the US.

In the past week, hardliners have stepped up their attacks on the Government’s foreign policy of “engagement”, especially of Western states. They have used the Supreme Leader’s warning that the US will use the nuclear deal to spread “sedition” within Iran and challenge the Islamic Republic in the Middle East.