The Iranian navy has always been the smallest of its three principal services, having about 14,500 personnel in 1986, down from 30,000 in 1979. Throughout the 1970s, the role of the navy expanded as Iran recognized the need to defend the region's vital sea-lanes. By 2008 there were 18,000 naval personnel. The navy is perhaps Iran's most important military service. The Persian Gulf must remain open for Iranian commerce since the Gulf is the primary route for all of Iran's oil exports and most of its trade. However, Iran's current navy structure is outdated and in need of substantial modernization, an effort that Iran is gradually attempting to accomplish. For the present, Iran's naval capacity remains limited and barely supports its status as essentially a coastal defense force. Iran's economic dependence on the free and interrupted use of the Persian Gulf for its commercial shipping combined with its past lessons in confrontations with the United States Navy in the 1987-88 time frame have reinforced Iran's determination to rebuild its naval forces.
The navy has its headquarters at Bandar-e Abbas. In 1977 the bulk of the fleet was shifted from Khorramshahr to the newly completed base at Bandar-e Abbas, the new naval headquarters. Bushehr was the other main base. Smaller facilities were located at Khorramshahr, Khark Island, and Bandar-e Khomeini (formerly known as Bandar- e Shahpur). Bandar-e Anzelli (formerly known as Bandar-e Pahlavi) was the major training base and home of the small Caspian fleet, which consisted of a few patrol boats and a minesweeper. The naval base at Bandar Beheshti (formerly known as Chah Bahar) on the Gulf of Oman had been under construction since the late 1970s and in late 1987 still was not completed. Smaller facilities were located near the Strait of Hormuz.
Iranian naval operations are organized into five major zones, three on the Persian Gulf (Bandar Abbas, Bushehr and Khark), one on the Caspian Sea (Bandar Anzali), and one on the Indian Ocean (Chah Bahar). Bandar Abbas is the main Iranian naval base, providing a home for the main components of Iran's navy (its frigates and destroyers), as well as functioning as the navy's main ship repair yard. Bandar Anzali has become increasingly important, having minesweeping and full coastal water defense capabilities. Nou Shahr, also on the Caspian, is increasingly important, housing the Iranian naval academy.
The Navy's airborne component, including an anti-submarine warfare (ASW) and minesweeping helicopter squadron and a transport battalion, continued to operate in 1986 despite wartime losses. Of six P-3F Orion antisubmarine aircraft, perhaps two remained operational, and of twenty SH-3D ASW helicopters, possibly only ten were airworthy. Despite overall losses, the navy increased the number of its marine battalions from two to three between 1979 and 1986.
Iranian naval forces held several exercises in early 2001 to improve their capabilities and also have had exchange visits with Pakistan and India. As a result, defense officials called for the consolidation of Iran's commercial and military fleets to increase their strengths, overcome any weaknesses, take advantage of opportunities, and address future threats. Iranian naval forces held the three-day Fath-9 exercises in the northern end of the Persian Gulf in Mahshahr during the first week of March 2001. These exercises involved 6,000 people from the regular navy and air force, the Islamic Revolution Guard Corps navy and air corps, the Basij Resistance Forces, and the Law Enforcement Forces.
Iran's navy as of 2000 had 20,000 men, but they were young and inexperienced, and most of them were riflemen and marines based on Persian Gulf islands. At higher levels, there had been a fierce rivalry between the IRGC and regular navies for scarce resources. Due to these shortcomings, Iran's three Kilo-class submarines would be vulnerable, and they were limited to laying mines in undefended waters. Mines, however, are one area in which Iran had made advances. It can produce non-magnetic, free-floating, and remote-controlled mines. It may have taken delivery of pressure, acoustic, and magnetic mines from Russia. Also, Iran was negotiating with China for rocket- propelled rising mines.
Iran's navy had held more than a week of war games in the Persian Gulf using tactical submarines and small vessels carrying missile launchers. The March 2007 exercises were the latest in a series of maneuvers staged by Iran's military in the Persian Gulf, where the United States had deployed two aircraft carriers in recent months, a move widely seen as a warning to Tehran over its nuclear ambitions. Though Iran cannot come close to matching US forces, it could cause trouble for shipping in the Persian Gulf and disrupt the flow of oil in the waterway through which 40% of the world's traded oil flows.
Despite having a submarine capability, in the 1990s Iran's navy is neither the best equipped nor the strongest in the region. Upon the acquisition of the Kilo-class submarines by the Iranian Navy, Saudi Arabia arranged for delivery of three upgraded La Fayette-type frigates (armed with anti-ship and anti- aircraft missiles, torpedo tubes and anti- submarine warfare helicopters) and one new Sandown-class coastal minesweeper. Iran's Navy, one of the region's most capable, can temporarily disrupt maritime traffic through the Strait of Hormuz using a layered force of KILO Class diesel submarines, ship- and shore-based antiship cruise missiles and naval mines.