Mahmoud Ahmadinejad received a rare boost yesterday when his economy minister unexpectedly survived an impeachment vote in parliament over a US$2.8 billion (Dh10.4 bn) bank fraud scandal, the biggest in Iran's history.
Legislators in the house, which is dominated by the president's opponents, voted 141 to 93 to retain Shamseddin Hosseini, who was accused of lax oversight of the banking sector.
Even so, Mr Ahmadinejad remains under unprecedented pressure. He is threatened with the humiliating possibility of being hauled before parliament for questioning on a host of issues, including the banking scandal, after the required number of MPs issued a petition on Sunday to summon him. The process could ultimately lead to his impeachment.
Keen to avoid the spectacle of a deep rift in the regime, Iran's supreme leader, Ayatollah Ali Khamenei, once a champion of Mr Ahmadinejad, had blocked earlier moves to bring him before the chamber for a grilling on the government's performance.
But relations between Iran's two most powerful men have soured in recent months. The ayatollah now seems ready to let the threat of impeachment hang over the president as a means to keep him in check during his remaining 20 months in office.
The supreme leader previously had signalled that he wanted Mr Ahmadinejad to serve out his term - but not at any price. Analysts say for now, Ayatollah Khamenei sees Mr Ahmadinejad as a useful lightning rod, absorbing responsibility for Iran's economic and political malaise.
The president would have to do "something overly provocative in the coming year" to change that thinking, said Farideh Farhi, an Iran expert at the University of Hawaii.
That cannot be ruled out given Mr Ahmadinejad's ambition and proven appetite for confrontation.
The supreme leader had given the president a political shield until April when Mr Ahmadinejad recklessly challenged his absolute authority in a dispute over a cabinet posting.
That public spat emboldened the president's many conservative opponents. They once supported him against the marginalised reformist opposition but now accuse him of trying to amass power in ways that challenge parliament, the supreme leader and the clerical establishment. The power struggle between Iran's ruling hardliners is set to intensify as they jockey for position ahead of parliamentary elections in March that will set the stage for a presidential poll in mid-2013. Mr Ahmadinejad has made little secret of his desire to carve out a political future beyond the constitutionally mandated end of his second term. Many believe he hopes to make a Vladimir Putin-style comeback in 2017.
But the banking scandal, which came to light in September, has given his enemies fresh ammunition.
The $2.8bn fraud case involved the use of forged documents to obtain credit from at least seven Iranian state and private banks to purchase state-owned companies. An Iranian businessman, Mahafarid Amir Khosravi, has been accused of masterminding the scam.
Mr Ahmadinejad is not directly linked to the investigation and his government has vehemently denied any involvement. But the president's conservative opponents in parliament have tried to link some of his close associates, including his controversial chief of staff, Esfandiar Rahim Mashaie, to Mr Khosravi.
Even before the embezzlement scandal, Mr Mashaie was under ferocious attack by the president's opponents who accuse him of "bewitching" Mr Ahmadinejad and of leading a "perverted", anticlerical current in the government.
The deputy governor of Iran's Central Bank, Hamid Pour-Mohammadi, another presidential ally, was reportedly arrested last Saturday over the alleged fraud, joining about 30 others already in custody.
Mr Ahmadinejad's enemies hope the case will tarnish his attempt to portray himself as an incorruptible man of the people battling a crooked system, an image that helped bring him to power in 2005. The populist president, the son of a humble blacksmith, often says his government is the "cleanest" in Iran's history.
But at a session of parliament broadcast live on state radio on Sunday, a report was read saying a parliamentary investigation had found senior government officials guilty in the case. The investigation said the economy minister, Mr Hosseini, his deputies and managers of the Central Bank and other banks, knew about the massive fraud but failed to take action.
Mr Hosseini defended himself in an emotional speech yesterday, saying he had not been aware of the fraud and offered his apologies to the parliament and the people.
Mr Ahmadinejad, addressing parliament in defence of his economy minister, argued yesterday dismissing Mr Hosseini would set back Iran's efforts to fight international sanctions over its nuclear programme.
Instead of tackling the banking scandal head-on, the president chose to focus on Iran's achievements and the evils of the West. It is meanwhile unclear when, or even if, Mr Ahmadinejad will be called before parliament: the process launched on Sunday is a lengthy one. The vote of confidence in Mr Hosseini could indicate the president's opponents are easing their attempts to undermine him.
Ms Farideh said the move to bring Mr Ahmadinejad in for questioning looks "like political theatre" staged by parliament "to show that it is loyal to its own rules" and to prevent the resignation of a key conservative MP.
