NEW DELHI: With most of the sanctions against Iran lifted, are we witnessing the making of a new power in West Asia? To start with, China has signed a decade-long deal with Tehran worth $600 million. China has relied on Iranian oil and views the country as a vital link in China’s president, Xi Jinping’s so-called Silk Road strategy, an ambitious agenda that seeks to extend China’s economic influence westward.

Now Europe is right behind — eagerly offering billions more for Iran’s business. Also, Melli Bank and Persia International Bank will be able to operate in the UK once they have met Bank of England criteria for financial firms.

Iranian-American author and activist Mazda Majidi stated ‘the impact (from lifting sanctions) will be huge. For decades Iran was locked out of the international trade and banking system and ostracized by many countries, including the US and parts of Europe.’

Currently, Iranian President Hassan Rouhani along with his 120-strong entourage of business leaders and ministers began their entourage of Europe. Rome was the first stop, and already multibillion-dollar deals worth up to 17 billion euros ($18.4 billion) have been signed. Italian Prime Minister Matteo Renzi and Rouhani had held “held friendly and constructive talks geared towards enhancing bilateral cooperation and deepening consultation on the main regional and international issues,” the Italian government statement said.

Along with it, Rouhani also met the Pope, the first of its kind visit after 16 years, since Mohammad Khatami visited Pope John Paul II in 1999. On a lighter side, nude statues in Campidoglio museum were covered, wine pulled from state dinner menu, to avoid offending Iran.

The decision of Rouhani to start his tour from Italy is not a coincidence but a geopolitically strategic move. The identity of Italy being a neutral observer in terms of relations with Muslim countries has played a pivotal role behind its selection.

Meanwhile, France declined to pull wine from the menu in Paris, so there will be no formal state dinner during Rouhani’s two-day visit to that country. Though, Mr Rouhani hopes to agree several deals, including with European aircraft manufacturer Airbus for 100 planes. French carmaker Peugeot said it had agreed a joint venture in Iran worth €400m ($436m; £304m). Patrick Pouyanne, the chief executive of French energy firm Total, said following a meeting with Rouhani on Thursday that the company will sign a deal to buy crude oil from Iran.

However, Mr Rouhani’s visit also sparked protests from activists over Iran’s human rights record, and use of the death penalty. One woman suspended herself from a bridge near the Eiffel Tower, with a banner reading: “Welcome Rouhani, executioner of freedom”.

Nevertheless in West Asia, this recent change in Iran’s behavior, and the restoration of diplomatic relations with Western countries including the United States has further alienated the Saudi Arabia, which seems to be completely detached from the waves of change that are taking place in the Middle East. Iran is here to stay, and the United States as well as Western Europe realized ― with cunning perception and diplomacy ― that the Mullahs are not interested in a continuous confrontation, thus a deal was made that guarantees Iran's compliance with international law, and dismantling of its nuclear program.

Meanwhile, Saudi Arabia is coming under financial pressure. With oil prices drifting towards $20, the wars in Yemen and Syria, and an economy that is 99 percent dependent on oil, foreign reserves will be depleted within three years. Taking tis into account. Iran which had already been ravaged due to sanctions is literally leaving no stone unturned when it comes to ‘liberalizing’ with the Western government and seeking new innovation geopolitical partnerships.

However, change and integration in the world economy, freedom of expression, democracy and the rule of law are the only guarantors for the future of Saudi Arabia and Iran, and which ever succeeds in their implementation would possibly become a dominant force in the region. So far Iran seems to be winning.

(The writer is a PhD scholar in Jawaharlal Nehru University, New Delhi).