US-Iran MoU.
The U.S.-Iran Memorandum of Understanding has been hailed as a breakthrough in a region exhausted by conflict. The agreement establishes a 60-day ceasefire, reopens the Strait of Hormuz, provides interim sanctions relief for Iranian oil exports, enables the release of up to US$25 billion in frozen Iranian assets and outlines a reconstruction framework that could mobilize as much as US$300 billion for Iran's recovery.
For many observers, these measures represent a meaningful step toward de-escalation. However, the agreement raises a more fundamental question - can lasting stability be achieved by addressing Iran's nuclear programme while leaving its missile capabilities and regional proxy network largely untouched?
To understand what the deep state within Iran truly desires, it is essential to grasp the grand strategy crafted by both Khomeini and Khamenei for the long-term survival of the Islamic Republic. Their evolving strategy rests on four main pillars: expanding power through the promotion of Islam and opposition to the United States, establishing a covert regional network, forging enduring alliances with states like Russia, and building a relatively self-sufficient military-industrial complex. It is clear that the first and third pillars have been severely weakened by the joint US-Israeli air strikes. However, the second and fourth pillars remain intact, sustaining the regime's threat to the region. As the late Hezbollah leader Hassan Nasrallah noted, it was General Soleimani who shaped Iran's policy toward Hamas, integrating it into the Axis of Resistance. The proxy network built by Soleimani continues to operate, despite its diminished capacity.
Most importantly, Tehran's indigenous military industry is another key factor that underscores the seriousness of the Iranian threat. Therefore, any attempt to reach a peace deal will be futile if the issues of proxies and the weapons industry are not addressed
The memorandum focuses primarily on the nuclear file while deferring discussions on Iran's ballistic missile programme, its support for regional armed groups and the long-term status of its enriched uranium stockpiles. While these issues may appear separate in diplomatic negotiations, Israel has long viewed them as components of a single security architecture.
On October 7, 2023, Hamas led militants crossed into southern Israel, killing at least 1,200 people and abducting 251 hostages. The attack was the deadliest day for Jews since the Holocaust. The final hostage was not returned until January 2026, 843 days after the assault. The conflict that followed transformed the region and reshaped Israeli perceptions of security for a generation. Yet Gaza was only one front.
Between October 2023 and September 2024, Hezbollah launched more than 8,000 rockets into Israel, forcing over 60,000 residents to evacuate northern communities. At the height of the campaign, approximately 1,300 rockets were fired in a single month. Israel's subsequent military operations significantly weakened Hezbollah's command structure and capabilities but the conflict reinforced a belief deeply embedded within Israel's security establishment regional threats cannot be viewed in isolation. The impact extended beyond Israel's borders.
Beginning in November 2023, Houthi attacks on commercial shipping disrupted one of the world's most important maritime trade routes. Around 100 vessels were attacked or hijacked during the campaign. At one point, container traffic through the Red Sea reportedly fell by as much as 90 percent, forcing shipping companies to reroute vessels around the Cape of Good Hope. The detour added roughly 11,000 nautical miles, ten additional days of travel and approximately US$1 million in fuel costs per voyage.
These events form part of the same strategic picture. The October 7 attacks, Hezbollah's sustained rocket campaign and the disruption of global shipping were carried out by different actors across different geographies. They demonstrated the reach of a broader Iranian led network capable of exerting military, economic and political pressure across the region. This is why the economic provisions of the new agreement attract as much attention in Israel as its nuclear provisions.
The release of up to US$25 billion in frozen assets, combined with sanctions relief and a reconstruction framework valued at up to US$300 billion, is viewed by many analysts through a strategic lens. Their concern is not merely about economic recovery inside Iran but about whether new financial resources could eventually contribute to rebuilding the regional influence that years of conflict have sought to weaken.
Equally important is the issue of operational freedom. The memorandum's call for military de-escalation across all fronts, including Lebanon, has triggered debate within Israel about whether future efforts to counter Hezbollah or other Iranian backed groups could become constrained by the political imperative of preserving the agreement. Israeli leaders have repeatedly signalled that they reserve the right to act independently if they believe national security is at stake. It reflects a different assessment of the challenge.
Washington appears to view the nuclear issue as the most urgent problem and the logical starting point for broader negotiations. Israel sees nuclear capability, missile development, financial resources and proxy networks as interconnected elements of a single threat ecosystem.
The ultimate test of the agreement, therefore, will not be whether it delivers a temporary pause in hostilities. It will be whether a framework that leaves missiles, proxies and regional influence largely outside its scope can deliver security that endures beyond the next crisis.
Until that question is answered, caution is likely to remain.
Author Bio
Punsara Amarasinghe is a lecturer at Faculty of Law, General Sir John Kotelawala Defence University, Sri Lanka. He is a leading academic voice on defence and foreign policy in Sri Lanka. Previously, he was a Post-Doctoral Researcher at Scuola Superiroe Sant Anna, Italy and has also been a Fellow at HSE Moscow and University of Wisconsin, USA.
