Protesters stage a demonstration in Tehran.
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Growing strains with the United States and political infighting at home threaten Iranian President Hassan Rouhani's plans to expand social freedoms, create jobs and draw in foreign investment, officials and analysts say. Anti-Western hard-liners defeated by Rouhani in the presidential election in May appear determined to take revenge by denying the pragmatic Islamic scholar an economic dividend, they believe.In that effort, he enjoyed the guarded support of Khamenei. But now, under heightened pressure in his second term to widen economic opportunities for Iran's youth, Rouhani can no longer be sure of the supreme leader's backing.After a campaign featuring outspoken attacks on security and judicial hard-liners and calling for a speedier opening to the world, Rouhani trounced Khamenei's perceived favorite in the election, irking the IRGC, Khamenei's ally.Sidelined by the nuclear deal, the Guard is trying to claw back economic clout by accusing Rouhani of favoring foreign firms over domestic ones, praising Khamenei's vision of a self-reliant economy that avoids foreign investment.Senior members of the IRGC and its front companies remain under U.S. sanctions. Most IRGC front companies, however, are not formally owned by the Corps, but by firms linked to it. Displeased with Rouhani's rising popularity, he will not back the president in his economic battle with the IRGC.
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