Iran at the crossroads of history and theology

This article is authored by B Bala Bhaskar, former ambassador and specialist in West Asia and Gulf Affairs, New Delhi.

Iran is witnessing one of the most serious challenges to the Islamic Republic since 1979. Protests that began in late December 2025 as economic strikes—starting from Tehran’s Grand Bazaar, long considered a pillar of the revolutionary order—have spread to all 31 provinces. The immediate trigger is an unprecedented economic collapse: The rial has fallen to more than 1.4 million per dollar, inflation exceeds 50%, food prices have soared, and shortages are widespread. What distinguishes this moment is not merely economic distress, but the breadth of participation and the explicit political demands. Chants calling for regime change, the fall of Supreme Leader Ali Khamenei, and an end to clerical rule constitute a qualitative escalation. They are embedded in a centuries-long evolution of Shi‘a political theology and State power.

Iran protest(AP)

At the core of Iran’s political order lies Twelver Shi‘ism, which traditionally held that legitimate political authority was suspended after the permanent occultation of the Twelfth Imam (since 911 CE), confining clerics to legal and moral guidance and political quietism. This doctrine was ruptured in 1501CE when Shah Ismail founded the Safavid State, declared Twelver Shi‘ism the State religion, and enforced the conversion of Persia’s predominantly Sunni population. Confronted by resistance from entrenched Sunni clerics, he imported Arab Shi‘a jurists, empowering mujtahids—authorised interpreters of the Qur’an and Prophetic tradition—and laying the foundations of the Usuli school. This marked a decisive politicisation of Shi‘a clerical authority, overturning centuries of doctrinal withdrawal from State power.

With the growing popularity of the Usuli school and the greater influence of the mujtahids, resentment toward the traditional school, the Akhbarites, steadily grew after 1530. The Akhbari school adhered to the tradition of political quietism preached by the early imams since the ninth century and rejected the interpretation (ijtihad) of the scriptures. They rejected the mujtahid's claim to represent the Hidden Imam and attacked them for applying reason in jurisprudence.

The Pahlavi dynasty (1925–1979) marked a sharp reversal in Iran’s historical balance between throne and clergy. Reza Shah, and later Mohammad Reza Shah, pursued rapid modernisation by systematically sidelining religion from public life. Clerical courts were abolished, religious endowments nationalised, veiling banned, and a pre-Islamic Persian identity promoted as the basis of nationalism. These measures helped build a centralised State, modern infrastructure, and new institutions, but they were imposed through authoritarian rule and deeply alienated traditional society—most critically the Shi‘a clergy.

This estrangement deepened as the monarchy grew dependent on foreign powers. The CIA–MI6–backed overthrow of democratically elected Prime Minister Mohammad Mossadegh in 1953 discredited the Shah in nationalist eyes and marked the regime as externally sustained. The US became the principal pillar of Pahlavi rule, providing military, intelligence, and political support in exchange for Cold War alignment and secure access to oil. Israel, though unofficial, emerged as a close partner, with Mossad–SAVAK cooperation shaping Iran’s repressive security apparatus. These alliances bolstered the Shah’s power but fuelled domestic resentment, uniting nationalist, Islamist, traditional bazaar, and Leftist opposition and paving the way for the 1979 revolution.

The 1979 Islamic Revolution resolved this historical oscillation by producing something unprecedented: The doctrine of wilayat al-faqih (Rule by the Jurist). Ayatollah Ruhollah Khomeini opposed the separation of religion and politics and argued that religion's purpose is to reorder society. He declared that in the Hidden Imam’s absence, a senior jurist must assume full political authority to ensure Islamic governance. The Supreme Leader became not merely a political head but also the Imam’s deputy, thereby establishing religious supremacy over political authority.

This fusion explains both the regime’s durability and its fragility. Dissent in Iran is not treated as a policy disagreement but as a challenge to divine order. Economic failure, corruption, and repression thus acquire existential significance. When some protesters today chant against clerical rule, they are not merely opposing a government—they are also rejecting a theological doctrine that has been built over five centuries.

At present, five distinct forces are at play in the demonstrations. First is the ruling establishment: a State anchored in a financially entrenched Usuli clerical hierarchy and the Islamic Revolutionary Guard Corps (IRGC), whose vast, legally sanctioned commercial interests confer exceptional economic and coercive power. Second are fragmented opposition currents seeking to dismantle clerical rule, including monarchist and secular groups in exile, symbolically represented at present by Reza Pahlavi, the son of the last Shah of Iran, some of whom are perceived to receive western backing. Third is the latent Akhbari–Usuli tension within Shi‘a thought: While politically marginal today, Akhbari critiques of clerical authority and ijtihad continue to form intellectual and theological dissent against the Usuli dominance that underpins the Islamic Republic. Fourth is a restless Generation Z, driven less by ideology than by frustration over unemployment, inflation, and blocked social mobility. Finally, the traditional bazaar class faces declining trade, sanctions, and growing commercial uncertainty, which weaken—but do not eliminate—its political relevance, which played a significant role in the 1979 revolution.

Since their expulsion from Iran after 1979, the US and Israel have consistently sought to weaken the Islamic Republic through pressure, sanctions, and covert operations. Yet history suggests that external intervention alone cannot resolve Iran’s crisis. Instead, it will create greater instability in Iran and in an already volatile region, and cause severe crises in energy and supply chain logistics. Unless the deeper ideological contest within Shi‘ism—particularly a fundamental challenge to the theological doctrine of the Usuli clerical order—is upended, perhaps by the banned Akhbari school, episodic upheavals are unlikely to produce durable political change.

This article is authored by B Bala Bhaskar, former ambassador and specialist in West Asia and Gulf Affairs, New Delhi.