With the results of the twin elections held in Iran last week officially established, it is clear that the electorate have dealt the ultra-radical President Ahmadinejad his first significant political defeat.

Despite some attempt at spinning the results, it is clear that the electorate wanted to serve notice on Ahmadinejad about its concerns over his populist domestic policy and poker-like foreign strategy.

The first and politically more important election concerned the choice of 86 mullahs to form the new Assembly of Experts (AOE) who has the task of electing and , if need be, dismissing the “Supreme Guide.” Since the “Supreme Guide” holds almost unlimited powers under the Islamist constitution, many analysts regard it as the true powerhouse of the Khomeinist system.

Elected for eight years, the new AOE may well choose the next “Supreme Guide” before it term ends in 2014. The incumbent, Ayatollah Ali Khamenehi, although aged only 66, is said to be in declining health that might force him to step down at some point.

Before last week’s election, however, the possibility of an early end to Khamenehi’s career as “Supreme Guide” had become a hot topic in Tehran’s political circles. There was a feeling that President Ahmadinejad, representing a new generation of radical revolutionaries with military and security backgrounds, was planning to seize control of the AOE and use it to replace Khamenehi with his own religious guru, a certain Ayatollah Muhammad-Taqi Mesbah-Yazdi. All that was needed for Ahmadinejad’s alleged scheme to be implemented was a change of 17 seats in favour of his faction in the AOE.

Because of the opaque nature of Iranian politics it is almost impossible to know how much of that story about the power struggle in Tehran is based on fact. However, there is no doubt that Ahmadinejad’s agenda is far more radical than that espoused by Khamenehi since 1989 when he was named “Supreme Guide”.

However, it was clear that Ahmadinejad has failed to secure the extra 17 seats he reportedly needed to win control of the AOE. Wore still, his ultra-radical faction suffered other humiliations. His ostensible guru, Mesbah-Yazdi came way down the list of those elected in Tehran while Ayatollah Hussein Gheravi, the faction’s standard-bearer in the key province of Khorassan, where the holy city of Mashhad is located, failed to win a seat. However, possibly the worst blow to Ahmadinejad was the election of former President Ali-Akbar Hashemi Rafsanjani, a mullah-cum-businessman he had handily defeated in presidential election in 2005.

Rafsanjani, whose political demise has been prematurely predicted on many occasions, was not only elected to the AOE but came top of the list in Tehran. As the come-back-kid of Iranian politics, Rafsanjani is also the man the Europeans look to for leading Iran away from the radical revolutionary path set by Ahmadinejad.

The real winner of the AOE election, however, is Khamenehi. He can count on a solid bloc of 40 seats held by his own allies while the two rival factions, respectively led by Ahmadinejad and Rafsanjani would be in no position to master a majority against him. By playing one faction against another, Khamenehi is likely to remain the ultimate arbiter of Iran’s politics for sometime yet.

The late Ayatollah Khomeini compared the peculiar system that he had created to a bird that needs two wings with which to fly. Ahmadinejad’s attempt at cutting one of the two wings off seems to have failed just as Rafsanjani failed to cut the opposite wing in the 1990s when he was president.

The power struggle in Tehran, however, is far from over. In the other election, held for municipal councils throughout the country, the ultra-radical faction led by Ahmadinejad did better. With more than 90 per cent of the results confirmed, Ahmadinejad and his allies, standing on separate lists, appear to have won control of councils in 27 of 30 provinces with some 73 per cent of the votes at national level. The conservative faction, led by Rafsanjani and his two protégés, former President Muhammad Khatami and former Parliamentary Speaker Mahdi Karrubi, collected 18 per cent of the votes at the national level and won control in two provinces. The remaining province, Tehran, the biggest in terms of population was won by a splinter group from Ahmadinejad’s faction, led by Muhammad-Baqer Qalibaf the outgoing mayor of the capital.

The blow dealt at Ahmadinejad is primarily a Tehran phenomenon. The capital city, with a population of some 15 million, is the stronghold of middle classes that have been frightened by the president incendiary rhetoric and alleged cravings for a “Clash of Civilisations” that could lead to war.

The key reason for Ahmadinejad’s defeat in Tehran and other major cities was the unexpectedly high turnout, estimated by the Interior Ministry at over 47 per cent. In Tehran, for example, no more than 700,000 people had voted in the previous election. This time the number jumped to more than two million out of some five million eligible to vote. According to newspaper reports and eyewitnesses in Tehran, most of the new voters were young, westernise middle class men and women who made no secret of their determination to deal a blow to Ahmadinejad.

Voting in Iranian elections is always problematic. Since all candidates are approved by the authorities in advance, most citizens are barred from running for office. Also, the results must be approved by a 12-man body of mullahs who could stroke anybody’s name from the list of winners, often on spurious grounds. Nevertheless, many Iranians believe that even such limited and patently undemocratic elections could provide an opportunity for affecting the balance of power within the ruling establishment.

There is no doubt that this is what Iranian voters have done, at least as far as the AOE is concerned. The question now is whether Khamenehi, with the Damoclean sword that Ahmadinejad wished to hang over his head out of the way, will try to rein in the firebrand president.

Rafsanjani, possibly Iran’s wealthiest man, represents the fears of the middle and upper classes that have seen the economy on the verge of collapse, businesses frozen and the outflow of capital turned into a flood, since Ahmadinejad’s election. But it is hard to see what the Rafsanjani faction can do against an administration that has managed to maintain its base among the urban poor and remains popular within the segment of the Iranian population that still believes in the Khomeinist revolution.

The impact of Ahmadinejad’s defeat in the AOE elections on Iran’s foreign policy is even harder to gauge. Rafsanjani and his faction have no means of directly influencing decision-making in that field. But they could serve as a channel of communication between the European Union and Khamenehi and persuade the latter to offer at least some of the concessions needed to defuse the crisis over Iran’s alleged nuclear ambitions.

However, that possibility may force Ahmadinejad to heat up his rhetoric further and adopt an even more aggressive posture to prevent any deal brokered by the European Union.

As always in Iranian politics under Khomeinism, good news comes mixed with bad. Ahmadinejad is wounded but still very much alive. And that, according to Machiavelli, is when a political animal is at his most dangerous.