Reuters reports: The article on Iran’s semi-official Fars news agency appeared routine: the minister of roads and urban development said the ministry does not have a contract with construction firm Khatam al Anbia to complete a major highway heading north from Tehran.

Two things made it stand out: Khatam al Anbia is one of the biggest companies controlled by the Islamic Revolutionary Guards Corps (IRGC) and company head Ebadollah Abdullahi had said just three days earlier that it did have the contract.

The December report was one of a series of signs that President Hassan Rouhani, who came into office last August, is using the political momentum from a thaw with the West over its nuclear program to roll back the Guard’s economic influence.

Existing government contracts with the Guards have been challenged by ministers and some, like the highway contract, that were left in limbo when Rouhani succeeded the more hardline Mahmoud Ahmadinejad, have been rebuffed.

Senior commanders in the Guards, established 35 years ago this week to defend the clerical religious system that replaced the Western-backed Shah, have criticized the nuclear talks but been more muted over the curbs on their economic interests.

Major General Mohammad Ali Jafari, said in December that Ahmadinejad’s government had insisted the Guards get involved in the economy.

“But we have told Mr. Rouhani that if he feels the private sector can fulfill these projects, the Guards are ready to pull aside and even cancel its contracts,” he said, according to the Iranian Students’ News Agency.

In the same speech, Jafari lashed out at the nuclear negotiations, saying Iran had lost much and gained little and took aim more directly at Rouhani. “The most important arena of threat against the Islamic revolution — and the Guards have a duty to protect the gains of the revolution — is in the political arena. And the Guards can’t remain silent in the face of that,” Fars quoted him as saying. [Continue reading…]