A cleric who campaigned to steer Iran on a more moderate course has won the presidential election. It is an outcome that has pushed the country to the brink of an extraordinary political transformation, and lifted the spirits of those demanding reform.
His power is not very limited in terms of ... running the country on a daily basis. In terms of foreign policy, he is not the only actor ... we have the Supreme Leader who would have a say in major issues ... and then we have the National Security Council in Iran that has members from different centers of power … the president would have influence, he is going to direct and appoint the foreign minister … but his powers are not unlimited.
Crowds celebrated the victory of Hassan Rouhani sensing hope for more social freedoms, and for some relief from economic hardship, brought on by years of sanctions imposed because of Iran's nuclear programme.
"This victory is a victory of wisdom, a victory of moderation, a victory of growth and awareness and a victory of commitment over extremism and ill-temper," Rouhani declared.
Rouhani has been a key figure in Iranian politics for many years. He served on the Supreme National Security Council for 16 years, and was national security adviser to two former presidents.
He took a tough stance during student demonstrations in 1999, warning that those found guilty of sabotage or destroying state property would face the death penalty.
Rouhani also served as Iran's chief nuclear negotiator from 2003 to 2005, and he has been described by western officials as an experienced diplomat and politician who is fair to deal with.
Reaction towards Rouhani's victory has been coming in from around the world. Israel's prime minister Binyamin Netanyahu warned against wishful thinking and said Iran would be tested by its deeds.
The White House says it remains ready to engage the Iranian government, and praised the will of the Iranian people who were determined to act to shape their future.
Russian President Vladimir Putin expressed confidence that Rouhani will promote and further strengthen Russian-Iranian relations, and Britain called on Rouhani to set Iran on a different course, and address international concerns about its nuclear programme.
So with the real power still wielded by Iran’s Supreme Leader, can Rouhani bring about meaningful change? And what are the issues that are most important to ordinary Iranians?
Joining Ghida Fakhry for this Inside Story are guests: Fouad Izadi, a professor of political communications at Tehran University; Hooman Majd, an author and journalist and former adviser to Iran's former president Mohammad Khatami; and Reza Marashi, a research director at the National Iranian American Council.
"I don't think there is any doubt that it was a legitimate election … Rouhani comes in with a mandate, there is no question … which makes it actually a little bit difficult for Westerners who may be antagonistic towards the Islamic Republic, to continue to demonise Iran … he has the support of the people … it is going to be something that Iranians are looking forward to ... a new administration, [a] change from the previous eight years.
-Hooman Majd, an author and journalist