The government continues to announce new weapons, the latest being anti-aircraft missiles and cruise missiles. These weapons somehow never make it into the hands of the troops, and are something of a joke in the region. The decades of embargoes have reduced the Iranian armed forces to a threadbare condition. The infantry units are reasonably good (both in the regular army and the revolutionary guard), but the mechanized forces, the navy and air force are all largely equipped with press releases, broken promises and not much else.
The Arab world is angry at Iranian meddling and war-mongering throughout the region. Palestinians accuse Iran of preventing Palestinian unity by ordering its client in Gaza, Hamas, to sabotage any efforts at reconciliation with their West Bank rivals. Syrian protestors believe Iran has helped the Shia minority that runs the country to put down the current unrest. Iran has demonstrated considerable skill in defeating its own protestors, and is apparently exporting these skills to favored allies. Bahrain and Kuwait accuse Iran of establishing spy networks in foreign nations and fomenting unrest. Lebanese politicians also accuse Iran of supporting a local Shia minority in an attempt to overthrow the Sunni/Christian majority and turn the country into an Iranian puppet.
Bahrain has told Iran to keep out of Bahraini affairs. Iran says it has had nothing to do with the two months of unrest in Bahrain, and demands that the 1,500 soldiers and police sent in by Saudi Arabia and other Gulf states, be withdrawn. Bahrain says the 1,500 foreigners will stay as long as needed (apparently until sufficient Pakistani mercenaries can be recruited, something else Iran protests about.) Bahrain has contained the latest uprising by its Shia majority, and seems determined to find concrete evidence that Iran gave more than media support to the rebels. Saudi Arabia is now openly, and regularly, criticizing Iran for interfering in the internal affairs of Arab countries. The revival of the ancient war between Arabs and Iranians (or Persians) is becoming more acrimonious and violent. It could get catastrophic.
The government is trying to get sanctions lifted from dozens of its senior officials. These sanctions make it difficult for the officials to travel, and do family business, outside the country. That's what the sanctions are meant to do.
President Mahmoud Ahmadinejad has succeeded in eliminating the expensive fuel and food subsidies, but has failed to control inflation and his working-class base of support is seeing their cost-of-living spiral into decidedly uncomfortable territory. Unemployment is over 20 percent and there is no relief in sight. The government is trying to calm things down with sporadic cash handouts. But the recipients know these are temporary solutions that can be eliminated at the whim of the president.
April 18, 2011: A dozen Iranians, employees of a construction company, were kidnapped in western Afghanistan. In this part of the world, Iran is involved in dozens of economic development projects. But there are also lots of bandits looking to get a large ransom for foreigners.
April 17, 2011: Another internal dispute surfaced when the Intelligence Minister offered to resign, but was then ordered to stay at his job. The government is increasingly at odds with itself as various factions clash on tactics and key appointments.
April 16, 2011: In the northwest, two bombs went off in a Kurdish town, causing a few injuries.
April 14, 2011: For the first time in 30 years, Iran has appointed an ambassador to Egypt. It's unclear if Egypt will accept, but at least Iran is trying. Iran cut ties back then because Egypt had made peace with Israel. Apparently Iran believes it now has an opportunity to persuade the new Egyptian government to abandon its peace treaty with Israel.
April 13, 2011: In Bahrain, two Iranians and a local man have been accused of spying for Iran.
April 10, 2011: Iran has expelled three Kuwaiti diplomats, in retaliation for Kuwait expelling three Iranian diplomats (who were accused of spying.)
April 4, 2011: Kuwait accused Iran of establishing eight espionage cells in Kuwait, two of them equipped for violent terror operations. Kuwait says it has the evidence and is prosecuting. Iran denies everything.
April 1, 2011: In the Kurdish northwest, four policemen were killed and one wounded when someone threw a grenade at them. Kurdish separatists continue to be a problem, despite thousands of additional police and soldiers sent to the area.
March 30, 2011: Turkey told the UN that it had forced down an Iranian Il-76 cargo plane, and found it carried a cargo of illegal arms. International sanctions prohibit Iran from exporting weapons. The aircraft was headed for Syria.
March 29, 2011: In Kuwait, three Kuwaiti soldiers (two of them Iranians, the other a Kuwaiti) were sentenced to death for spying for Iran.