INDIA - IRAN RELATIONS – INTERNATIONAL

News: Iran FM scraps visit to India

 

What's in the news?

       A blink-and-miss two-second shot of Iranian women cutting their hair in protest, juxtaposed with an image of Iranian President Ebrahim Raisi has upset Tehran, forcing their Foreign Minister to cancel his visit to India next month.

       Iran’s Foreign Minister Hossein Amir-Abdollahian was due to travel to India for the Raisina dialogue scheduled for March 3 and 4.

 

India-Iran Relations:

Backdrop:

       The diplomatic links were established on 15th March 1950, when both countries signed a Treaty of Friendship and Perpetual Peace.

       However, Iran’s joining of the Baghdad pact in 1954 and the Cold War politics prevented both countries from having closer relations until the 1990s.

       Islamic Revolution of 1979, hostage of US diplomats, Iran-Iraq War and Tehran’s support for Hezbollah and Hamas among others resulted in a range of political and economic sanctions, leading to Iran being isolated at a global level

       In the 1990s, both countries’ interests converged around energy, Central Asia and security, mostly around the Pakistan-Afghan region.

       This resulted in the signing of ‘The Delhi Declaration’, which provided the vision of the countries’ defence and strategic partnership and “Tehran Declaration”, which set forth the areas of possible cooperation.

 

Bilateral Relations:

1. Energy:

       India-Iran commercial ties have traditionally been dominated by Indian import of Iranian crude oil.

       Iran has been one of the top sources of crude oil for India.

       The proposed Iran-Oman-India undersea gas pipeline can help India move towards clean energy

 2. Geo-Strategic Connectivity:

       Infrastructure projects like Chabahar Port, International North South Transport Corridor will help India to bypass the overland route through Pakistan and help in better trade relations with West and Central Asia.

       Iran-Afghan railway link:

       India is currently involved in constructing a 560mile long railway line linking the Iranian port with the iron ore mines in Hajigak in southern Afghanistan.

       The railway link, when completed, will potentially afford India some strategic benefits including increasing India’s position and leverage in Afghanistan and the central Asian region. This affords India an easier connection to Afghanistan after avoiding Pakistani blockages.

       Land bridge to Central Asia and Eurasia:

       Iran has sought to leverage its crossroad geographical location straddling the Persian Gulf and the Caspian Sea, India has come to see it as its land bridge to Central Asia and Eurasia.

       Alternative Caspian Sea Route:

       The activation of an alternative Caspian Sea route speaks volumes about the positive outlook of Iran, India and Russia on this corridor despite a variety of geopolitical challenges.

3. Geopolitical Significance:

       Iran would act as a gateway to Central Asia and Afghanistan.

       India and Iran can engage each other to strengthen the demand for rule-based order in Afghaistan.

4. Cultural Relation:

       A MoU was signed in 2008 on holding “Days of Culture” in two countries.

       An Indian Cultural Centre in Tehran was inaugurated in 2013.

       The Cultural Centre was renamed the Swami Vivekananda Cultural Centre (SVCC) in 2018, and was provided a separate premises in 2019.

5. Tackling Terrorism:

       India and Iran both face the threat of terrorism by outfits like Al-Qaeda and Islamic State. Hence both the countries can merge their interest to counter terrorism.

6. Industries:

       Iran believes that India fulfills a substantial part of Iran’s needs.

       For example, India is very capable in steel, in aluminum, in mines and metals, railroads, software, IT, technology and so on. There is a lot of demand in these sectors in Iran.

7. Trade Relations:

       The bilateral trade during 2019-20 was $4.77 billion, a decrease of 71.99% as compared to the trade of $17.03 billion 2018-19.

       India’s major exports to Iran include rice, tea, sugar, soya, medicines/pharmaceuticals, man-made staple fibers, electrical machinery, etc.

       Major imports from Iran include inorganic/organic chemicals, fertilizers, cement clinkers, fruits and nuts, leather, etc.

8. People to people contacts:

       There is a high-level commitment in both countries to promote and facilitate people to people contacts.

       Indian pilgrims visit the Shia pilgrimage circuit in Iran (Qom, Mashhad, Hamedan) and Iraq (Najaf and Karbala) every year.

       India over the years has emerged as one of the favourite tourist destinations for Iranian tourists and every year around 40,000 Iranians visit India for various purposes.

 

Challenges:

1. India’s relations with Saudi Arabia, US and Israel: 

       Growing Saudi-India-US-Israel relations have irked Iran.

       In retaliation, Iran, for the first time, has linked the plight of Muslims in Gaza, Yemen, and Bahrain, with those in Kashmir.

       New Delhi’s decision to join the Israel-India-UAE-U.S. group, portrayed as an “anti-Iran” coalition.

2. Iran-Pak-China ties:

       Warming Iran-Pak-China ties have annoyed India.

3. Sluggish Chabahar port development:

       Slow Chabahar port development has annoyed Iran.

4. China-Iran strategic partnership:

       An economic and security partnership deal between Iran and China was recently made public, creating a global alarm, especially for India and the US.

       The draft agreement involves Chinese investments worth $400 billion into the Iranian economy over 25 years.

       Of this, $280 billion will be allocated for the oil and gas sector and the remaining funding will be for other core sectors like banking, telecommunications, ports and railways.

       In return, China would get a steady supply of Iranian oil at a heavily discounted rate during the same period.

5. USA Sanctions on Iran:

       India has drastically cut its Iranian engagement due to sanctions (oil import), while Iran has looked to China for more infrastructure investment.

       Bilateral trade dropped to just over $2 billion (2020-21) from $17 billion (2017-18).

 

WAY FORWARD:

1. Multilateral Engagement:

       As India is treading a fine line in balancing relations with the US, China and Iran while striving to augment its political influence in West Asia, embracing one country over the other is not an option for India.

2. Chabahar Port:

       India must retain its involvement in the Chabahar port development because of the geostrategic significance.

       In the immediate term, India should improve its multi-alignment credentials to absorb investments into the port projects from the public and private sector, boost maritime cooperation among littoral countries to enhance the transit of goods, and foster regional partnership for the Chabahar port development.

3. Converging with other nations:

       Based on the mutual geostrategic and energy interests, India could collaborate with Japan under the Asia-Africa Growth Corridor.

       Japan’s participation would enhance the multilateral characteristics of the transit hub in the region, unlike the China-owned Gwadar port. This will further enhance multilateral investments to solidify regional economic partnerships that enable the sustainability of the port.

 

India and Iran need to rebuild their ties affected adversely by recent global events. India must try to remain politically engaged with Iran for a better appreciation of each other’s sensitivities and compulsions and mutual interests.