Iwata joined Celtic on loan in January before the deal was made permanent in the last summer transfer window.
However, the Japanese midfielder has struggled to get a look in this season under manager Brendan Rodgers and has made just three appearances in a Celtic shirt in the ongoing campaign.
Donnelly pointed out that Iwata arrived at Celtic with a good reputation but has not been able to carve out a niche for himself in the Bhoys squad.
He indicated that it is not his fault as Callum McGregor, Matt O’Riley and Reo Hatate will start most games when they are fit, ahead of the 26-year-old midfielder.
The former Bhoy said on Clyde 1’s Superscoreboard: “Iwata scored a goal at Tynecastle and he came with a great reputation.
“He was the Player of the Year in the J-League the year he signed for Celtic but again, he hasn’t had a lot of game time.
“Is that down to the guys in front? I’d probably say, yes.
“At the moment, it is shift. If McGregor is fit, he plays, if O’Riley is fit, he plays and if Hatate is fit, he plays.
“It is hard to shift those three if they are fit and they are the three best midfielders.
“It is what it is at big clubs like Celtic.”
It remains to be seen whether Iwata will look for a move in January if he continues to remain an afterthought at Celtic.
