The India-US-Iran Diplomatic Triangle

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During his recent visit to India, US Defence Secretary Chuck Hagel said, “India need not choose between closer partnership with America and improved ties with China”. It is indeed good that India does not have to choose between America and China. The question that Hagel would perhaps like to skip is whether India would be forced to choose between America and Russia or perhaps between America and Iran? Since US is keen to improve its relations with India after the slump observed in the past few years, it is likely to cut India some slack vis-à-vis its longstanding partnership with Russia. Meeting Mr. Putin on the sidelines of BRICS summit in Fortaleza, Mr. Modi said, “If you ask anyone among the more than one billion people living in India who is our country’s greatest friend, every person, every child knows that it is Russia.” The statement points to the lack of options US has in this case, at least.

Iran, however, is a trickier proposition. In an interview to Daniel Twining in 2007, a senior US State Department official identified Iran as “the biggest single obstacle to the future of US-India relations and the one issue that could torpedo our strategic partnership”. US had to considerably soften its stand on India’s continued diplomatic and trade support to Iran while legislating to enable civil nuclear exports to India. US administration, however, was to annually report to Congress on New Delhi’s cooperation with Washington on containing Iran’s nuclear program.

Iran is an important partner for India when it comes to fulfilling the burgeoning energy requirements of the latter. India is important to Iran as the second largest importer of Iran’s oil and the country which helps dilute the diplomatic isolation the US tries to foist on it. India did considerably reduce its exports from Iran in 2013. Oil imports from Iran amounted to just 5.5 per cent in 2013 compared to 8.3 per cent in 2011-12. Later, the interim nuclear deal signed between Iran and P5+1 in November 2013, along with instability in Iraq resulted in India’s import of oil from Iran increasing to 2,70,600 barrels per day (bpd) during the period of January-July. This is 46 per cent more than imports during the same period in 2013. While the sanctions limit Iran’s oil exports to 1 million bpd, Iran’s exports have surged from a (US-dictated) acceptable 1.1 million bpd in 2013 to 1.4 million bpd in January-May 2014. According to US Energy Information and Administration, India and China account for most of this jump from 2013 to 2014.

China, the largest importer of Iran’s oil also argues on behalf of Iran during the deliberations between Iran and P5+1. China has increased its oil imports to 6,30,000 bpd, 48 per cent more than what it imported in 2013. China has also begun to exploit many commercial opportunities in the port city of Chābahār in Iran. This has prompted Indian government to fast track its development of Chābahār port to which it had committed way back in 2003 while signing the New Delhi Declaration during the visit of then-Iranian President Mohammad Khatami. The commitment to develop rail lines from Chābahār to Fahraj, and Bam towards northwest has hardly seen any progress. Chābahār is connected to Zaranj in Afghanistan through Milak via Zahedan. The Zaranj-Delaram highway built by India connects to Herat and Kabul in north and Kandahar in south. This is the only reliable route for Indian goods into Afghanistan and Central Asia, considering hostile relations with Pakistan. Having committed to so much in 2003, it will be unwise for India to lose the strategic opportunities provided by Chābahār.

Iran also shares Indian concerns over the rise of Sunni militancy in Afghanistan and its malevolent designs on the neighbourhood. However, Iran is also disconcerted with US presence in Afghanistan and would like to see them withdraw as soon as possible. It is clear that India-Iran relations are long-term and more than just oil-centric. India should do well to follow in the footsteps of China to increase non-oil trade with Iran.

Iran and P5+1 have missed the deadline of July 20 to come to a final agreement. The new deadline to reach an agreement is November 24. Narendra Modi’s visit is scheduled to begin on September 27, around four weeks before the deadline. Iran is likely to be introduced into the talks from the US side. Given that Indo-US relations have plunged considerably in the last few years, US is unlikely to be absolutely obdurate on Iran.

US foreign policy has ignored India in the last few years. Senator John McCain on his recent trip to India gathered correctly that Indians think the US is distracted and unreliable. Narendra Modi personally does not have a pleasant history with the US on account of the visa row. As PM candidate of BJP, Modi took a strong position against the treatment meted out to Indian diplomat Devyani Khobragade. US also has to persuade India to make alterations in its nuclear liability law so as to make US-India Civil Nuclear Agreement a success. These factors might convince the US to not project Iran as an obstacle, at least for this visit. Five visitors including three secretaries and one deputy secretary have made a trip to India within three months of Narendra Modi government coming into power. This is indicative of the importance US is now attaching to this relationship. Russia and Iran cannot be perceived as diplomatic stumbling blocks; the latter, in particular, will have to be ignored (albeit reluctantly) by US in the larger interests of long-term India-US strategic partnership.