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India–Iran Relations: Old Bonds, New Horizons for an Enduring Partnership
Context: India-Iran relations are gaining renewed significance amid shifting global geopolitics, energy security concerns, and the need for regional connectivity. With projects like Chabahar Port and the INSTC offering strategic opportunities, deeper cooperation between New Delhi and Tehran is crucial for balancing regional power dynamics and countering global economic uncertainties.
What is the significance of Iran for India?
- US Sanctions: Iran is supporting India against “weaponisation of economy” by the USA. Both the countries stand to collaborate for a more powerful non Western-led multilateral world order and a stronger Global South.
- Global Power Balance: In a multipolar world, both nations share an interest in building regionalism as a counterbalance to great-power rivalries.
- Power Balance in West Asia: Iran provides India a strategic counterweight to China’s expanding influence in West Asia and Central Asia.
- Regional Security and Counterterrorism Cooperation: Cooperation on security matters, particularly related to Afghanistan’s stability, counterterrorism, and maritime security to safeguard energy routes like the Strait of Hormuz.
- Energy Cooperation: Until 2018, was India’s third-largest crude supplier, meeting nearly 10% of India’s oil imports (Economic Survey 2018-19). ONGC Videsh also invested in Iranian hydrocarbon blocks.
- Connectivity Projects: India’s investment in Chabahar Port, Iran’s only oceanic port, provides access to Afghanistan and Central Asia, bypassing Pakistan. The port is a key node in the International North-South Transport Corridor (INSTC).
- Cooperation on Multilateral Platforms: Membership of the Shanghai Cooperation Organisation (SCO) and cooperation in regional forums reflect growing institutional engagement.
What are the major challenges in India–Iran bilateral relations?
- US Pressure: Secondary sanctions on Iran since 2018 disrupted India’s crude imports and slowed Chabahar port funding.
- Strategic Balancing: India’s growing ties with the US, Israel, and Gulf States complicate its engagement with Iran.
- China Factor: Iran’s 25-year strategic pact with China (2021) and Beijing’s role in Iran’s infrastructure projects pose competition for India.
- Regional Instability: Conflicts in West Asia and uncertainty in Afghanistan affect the operationalisation of connectivity projects.
What measures and plausible solutions can be taken to address the challenges?
- Diversified Engagement: Beyond hydrocarbons, expanding ties in IT, pharmaceuticals, agriculture, and education can reduce sanction-related disruptions.
- Multilateral Shielding: India can use forums like SCO and BRICS to anchor economic cooperation with Iran within larger regional frameworks.
- Chabahar Acceleration: The port, exempted from some US sanctions, should be fast-tracked (Economic Survey 2022-23), which highlights logistics connectivity as a driver of trade resilience.
- Strategic Energy Security: While sanctions constrain crude imports, India can maintain long-term stakes in Iran’s energy sector to hedge against volatility.
“Iran represents both a huge opportunity and a major liability for Indian foreign policy. The challenge for Delhi is to secure the first while minimising the second.“– C. Raja Mohan
