News Highlight
During a meeting between the Prime Minister of India and the Iranian President, Iran will nudge India towards reviving its procurement of discounted Iranian sweet crude.
Key Takeaway
- The Indian prime minister and Iranian president are likely to take place on the sidelines of the Shanghai Cooperation Organisation (SCO) summit in Samarkand.
- The question of India’s oil imports from Iran, which were cancelled in 2018-Â19, and the next stage of Chabahar port development is expected to be on the agenda for bilateral talks.
- The discussion over India’s oil purchases from Iran has been revived four years after India decided to cancel its oil imports from Iran under the threat of U.S. sanctions.
India-Iran economic and strategic relations
- Energy security:
- Iran was the second-largest supplier of crude oil to India, supplying more than 425,000 barrels per day. Consequently, India is one of the largest foreign investors in Iran’s oil and gas industry.
- India stopped importing oil from Iran in mid-2019 following the United States sanctions on the Persian Gulf nation by the United States.
- The Chabahar port:
- Chabahar Port is a seaport in Chabahar, located in southeastern Iran, on the Gulf of Oman.Â
- It serves as Iran’s only oceanic port and consists of two separate ports named Shahid Kalantari and Shahid Beheshti, each of which has five berths.
- It will provide India with an alternative and reliable access route into Afghanistan and a reliable and more direct sea-route access into the Central Asian region.
- International North-South Corridor:
- It is a freight shipping, rail, and road route connecting India, Russia, Iran, Europe, and Central Asia.
- The goal is to provide the shortest multi-model transportation route possible.
- The corridor aims to improve trade links between major cities, including Mumbai, Moscow, Tehran, Baku, Bandar Abbas, and Astrakhan.
- Infrastructure:
- India has constructed the Zaranj-Delaram highway in Afghanistan with the support of Iran.
- It can give access to Afghanistan’s Garland Highway, setting up road access to four major cities in Afghanistan — Herat, Kandahar, Kabul, and Mazar-e-Sharif.
- Indian Ocean Rim Association(IORA):
- It is a dynamic inter-governmental organisation promoting regional cooperation and sustainable development within the Indian Ocean region.
- Both India and Iran cooperate on maritime security under IORA.
India and Iran Relations: Issues and Challenges
- CAATSA:
- Countering America’s Adversaries Through Sanctions Act (CAATSA) is a United States federal law that imposes sanctions on Iran.
- It has caused India to limit its trade with Iran.
- Middle East Quad:
- The grouping of India along with Israel, the US and the UAE may be perceived as anti-Iran and may sour relations.
- Israeli relation:
- India’s closer relationship with Israel has caused a rift in India-Iran relations.
- Chinese influence:
- The Chinese trade and military deal with Iran threatens India and Iran relations.
- The US-Iran conflict:
- India’s closer strategic tie with the US and the US-Iran conflict led Iran to be isolated from the Indian interests.
Pic Courtesy: The Diplomat
Content Source: The Hindu