Iran Nuclear deal: India faces big setback
NEW DELHI - US President Donald Trump's decision to pull out of the Iran deal could impact India in a range of areas, including overseas projects, exports, payments for oil, and even international relations, India today has reported.
The deal, signed during Barack Obama's tenure in the White House, eased sanctions on Iran in exchange for Tehran limiting its nuclear program.
Now, US sanctions could could affect the development of the Chabahar Port (located in southeastern Iran), part of a route that connects India and Afghanistan, and circumvents Pakistan. New Delhi has already committed $85 million to the project, with a total planned investment of $500 million.
Here's a statistic that provides some perspective on the importance of the port <link>: Last year, a 1.1 million tonne Indian wheat consignment was sent through it.
Donald Trump holds up a proclamation declaring his intention to withdraw from the JCPOA Iran nuclear agreement after signing it in the Diplomatic Room at the White House in Washington. (Photo: Reuters)
The Chahabar port isn't the only project that could take a hit - there's also the $1.6 billion India-Iran-Afghanistan railway line, and the International North South Transport Corridor (INSTC). The INSTC is an ambitious 7,200-km multi-mode network project (India is part of it); it begins in Iran and ends in Russia, cutting right across Central Asia. Its goal is to cut costs and transportation time.
If US sanctions cause countries or financial institutions involved in the project to back out, the INSTC will be impacted.
India has always maintained that the Iranian nuclear issue should be resolved peacefully through dialogue and diplomacy by respecting Irans right to peaceful uses of nuclear energy as also the international communitys strong interest in the exclusively peaceful nature of Irans nuclear program. All parties should engage constructively to address and resolve issues that have arisen with respect to the JCPOA.
- MEA spokesperson Raveesh Kumar
PAYMENTS FOR OIL
During the era of sanctions, India had major backlogs in terms of payments towards oil imports from Iran. When the sanctions were lifted, both New Delhi and Tehran heaved a sigh of relief, and payments could be made.
Trump's decision <link> - which Barack Obama described as "misguided" in a long Facebook post - would have a major impact on these payments.
In fact, Iran is currently India's third biggest supplier of oil, and any upward fluctuation in oil prices would affect the price in India - which would have an impact on inflation and the rupee-dollar equation.
China has been considering the induction of Iran into the Shanghai Cooperation Organisation (SCO) - an eight-member grouping which includes India, and is led by Beijing and Moscow.
If Iran is inducted after the re-imposition of US sanctions, India could be seen as being part of an anti-America bloc.
Walking away from the JCPOA turns our back on Americas closest allies, and an agreement that our countrys leading diplomats, scientists, and intelligence professionals negotiated. In a democracy, there will always be changes in policies and priorities from one Administration to the next. But the consistent flouting of agreements that our country is a party to risks eroding Americas credibility, and puts us at odds with the worlds major powers.
- Former US President Barack Obama/Facebook
For now, European nations, Russia and China have shown commitment to the Iran nuclear deal (Joint Comprehensive Plan of Action, or JCPOA), which was endorsed by a UN Security Council resolution soon after it came into existence on July 14, 2015.
Former US president Barack Obama (left) at an event held to discuss the the Iran nuclear deal at the White House in September 10, 2015. (Photo: Reuters)
Trump says the JCPOA has failed to prevent Iran from developing nuclear weapons or supporting terrorism in the region.