Evolution of ties & Contemporary Issues INDIA – IRAN

India and Iran share civilizational ties with shared history and culture. The “Tehran Declaration” signed affirmed the shared vision of the two countries for an “equitable, pluralistic and co-operative international order”. New Delhi’s contemporary relation with Tehran is dependent upon India’s energy security, Access to central Asia and Iran’s enduring rivalry with Islamabad. India and Iran share close historical ties from the ancient times. Iran is an important nation in India’s neighbourhood and the two countries shared a border until India’s partition and independence.

Importance of Iran:

  • Iran is located at strategic and crucial geographical location between the Persian Gulf and the Caspian Sea.
  • Iran is important to India as it provides an alternate route of connectivity to Afghanistan and Central Asian republics, in the absence of permission for India to use the land route through Pakistan.
  • Important for energy security of India as Iran is major oil supplier to India.

Issues between Indo-Iranian ties:

  • The stoppage of oil imports from Iran after May 2019 owing to U.S. sanctions (CAATA) following the revocation of the Iran nuclear deal, therefore, impacting India’s energy security.
  • India’s close relations with Israel, and Iran’s ties with China, including signing a 25-year strategic partnership agreement.
  • Iran is also going ahead with developing the Farzad-B gas block without India.
  • Iran-backed Houthis in Yemen launching drone attacks against Saudi Arabia and UAE, both are close partners of India,
  • Iran’s tough statement on the Indian government’s abrogation of Article 370 of the Indian Constitution, gave special status to Kashmir.
  • In the wake of concretizing Russia-China-Iran axis and the US-Arab- Israel axis, India will have tough choice to make.
  • Connectivity to Afghanistan via Chabahar port is already under question because of the Taliban’s takeover.


Recently, Iran dropped India from the Chabahar Port and decided to continue with its construction on its own. Iran authorities mentioned the delay in funding as the reason.

  • The port of Chabahar is located in southeastern Iran in the Gulf of Oman.
  •  It is the only Iranian port with direct access to the ocean.
  • It will make way for India to bypass Pakistan in transporting goods to Afghanistan using a sea-land route. 
  • It would give momentum to the International North-South Transport Corridor of which both are initial signatories along with Russia. 
  • The development of Chabahar port and its associated infrastructure is beneficial for India in two main ways. One is that it will make it easier to access oil imports from Iran. Another is that it may balance Chinese trade and development projects in Central Asia and the Middle East which are associated with its Belt and Road Initiative (BRI).
  • Chabahar offers an alternative to China’s own efforts to extend influence in the region, including through its own efforts at improving the port of Gwadar, on the Pakistan side of the border.


  • In 2016, the Trilateral Agreement on Establishment of International Transport and Transit Corridor was signed among India, Iran and Afghanistan.
  • The transit and transportation corridor allows Indian goods to reach Afghanistan through Iran, bypassing Pakistani territory, and complements the Zaranj-Delaram highway built by India in Afghanistan.
  • Under this agreement, India committed towards developing Chabahar port as well the land-based route connecting the port to Afghanistan.
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Difficulties in India’s involvement in the project

  • Delays due to U.S. sanctions: USA re-imposed sanctions on Iran after withdrawal from Joint Comprehensive Plan of Action. While India was given a special waiver for Chabahar port and rail line, the project suffered due too bureaucratic delays in USA for actual clearance of the import of heavy equipment.
  • Operational hurdles like delays in dispersal of funds, lack of effective communication and diplomatic coordination etc. Delays can make it easier for China to expand its footprint in the region.
  • Chinese influence: China-Iran 25- year deal to play role against India.
  • Access to Afghanistan: Repeated instances of a disjointed India-Iran bilateral will inevitably result in reduced Indian presence, influence, and leverage at Chabahar, affecting India’s relationship with Afghanistan.

Joint Comprehensive Plan of Action (JCPOA)

  • It is also known as 2015 Iran nuclear deal.
  • The JCPOA was the result of prolonged negotiations between Iran and P5+1 (China, France, Russia, the United Kingdom, the United States + Germany).
  • Under the deal, Iran agreed to significantly cut its stores of enriched uranium and heavy-water, key components for nuclear weapons.
  • Iran also agreed to implement a protocol that would allow inspectors from the International Atomic Energy Agency (IAEA) to access its nuclear sites to ensure Iran would not be able to develop nuclear weapons in secret.
  • West agreed to lift sanctions related to Iran’s nuclear proliferation.
  • Israel and Saudi Arabia, America’s closest ally in the Middle East, strongly rejected the deal.
  • US under Trump Administration abandoned the deal and reinstated banking and oil sanctions.

After Trump abandoned the deal, Iran ramped up its nuclear programme in earnest.

Way forward

  • India needs to improve its implementation record of foreign infrastructure projects by fast tracking diplomatic talks and timely dispersal of funds.
    • India needs to find a balance between its diplomatic ties with Iran and U.S.A. An effective and clear arrangement that reduces the impact of US sanctions on Iran on India’s projects needs to be worked out.
    • Although Iran has proceeded with the construction of rail project, Iran hopes India will help it procure equipment in the second phase of the project. India can use this opportunity to establish productive bureaucratic and diplomatic channels for involvement in the project.
  • There is a need to look forward toward areas of convergence, where both countries have a mutual understanding of each other’s common interests and further work together to achieve the same.


  • Belt and Road Initiative (BRI): Under the BRI umbrella, China is presently strengthening its ties with Iran using engagements such as construction of railways, industrial parks, clean energy project etc.
  • Both agreed 25-year comprehensive strategic cooperation of $400 billion agreement includes allocations in Iran’s transport, manufacturing sector etc. which will give way to Chinese companies, equipment and workers in Iran.
  • Gwadar-Chabahar connectivity: Iran proposed a tie-up between Gwadar and Chabahar. It can impinge on India’s strategic ties with Iran.
  • Bandar-Abbas port: Iran has offered interests to China in this port located just 350km away from Chabahar. The Bandar-Abbas port can extend China’s control along the Pakistan-Iran coast.
  • Even after US sanction China bought Iranian crude oil to support the economy of sanction hit Iran. This built mutual trust and strategic partnership with Iran.
  • Currency swap agreement with Iran to bypass US sanction.
  • Supported Iran for development of its nuclear capacity for its peaceful use i.e., energy.

Other concerns in the region:

  • Expanding presence of Chinese submarines in the Indian Ocean.
  • Iran leveraging China and Pakistan as potential investors for the Chabahar Special Economic Zone.
  • The 2019 joint naval exercise between China, Iran, and Russia in Gulf of Oman.


  • India’s relations with Iran contain both a national security and an economic dimension. Indian policy makers see relations with Iran not only as a key energy supplier but as a way to contribute to enhancing India’s security in Central and South Asia, by containing India’s main rival, Pakistan, while also offering a counterweight to China’s rising regional presence. 

Need of the hour is to balance relation and protect interest in West Asia:

  • India is prepared to “act west” at a time when the Gulf countries are “looking east”. Both the Saudi and Iran want India as an economic partner and a friend.
  • Take the case of Saudi Arabia, the kingdom is going through a major economic overhaul and launched a $3 trillion sovereign wealth fund to invest in business opportunities abroad.
  • India offers both investment opportunities for the Saudi fund and remains a major buyer of its oil which make the country an important economic destination for the Saudis.
  • For Iran, which doesn’t have many friends among the international community, India remains an important partner despite the fraying of bilateral ties during the sanctions years. The sanctions had weakened Iran’s national economy badly. Tehran is trying to make up for those losses by beefing up oil trade with foreign countries and acquiring new agreements with foreign energy companies. 
  •  India is not seen as a hostile power by either of the blocs. The Saudi camp has its reservations about China given its proximity towards Iran. In the wider global scenario, Beijing is closely linked with Iran and Russia. Even as the trade ties between Saudi Arabia and China keep thriving, there’s a fair amount of strategic mistrust between them.
  • On the other side, India has kept its equidistance. The Saudis know that India does not have any ambitions to control West Asia. Nor is India part of any global alliance that challenges the Saudi influence in the region. This makes it easier for New Delhi to deepen its partnership with the Gulf Arab countries. India has also maintained a distance from developments which Iran sees hostile to its interests. India’s stated position is against any kind of military interventions, be it in West Asia or elsewhere.
  • The “Neighborhood” and “Extended Neighborhood” policies form the bedrock of the Indian government’s efforts to pursue this engagement.


Iran and Saudi Arabia have agreed to revive diplomatic relations and reopen embassies after seven years of tensions. The deal has been struck with the help of China.

More about the news:

  • The two regional rivals are expected to reopen embassies as they re-establish ties and a security agreement after Beijing talks.
  • Beijing maintains ties with both countries, and the breakthrough highlights its growing political and economic clout in the region which has long been shaped by the influence of the US.

Background of Iran-Saudi Arabia relations:

Areas of Tensions:

  • Tumultuous relationship between the two countries dates back to Iran’s Islamic revolution in 1979.
  • Tensions have been high between Iran and Saudi Arabia. Saudi Arabia broke off ties with Iran in 2016 after protesters invaded Saudi diplomatic posts in Iran. 
  • Shia-majority Iran and Sunni-majority Saudi Arabia support rival sides in several conflict zones across the Middle East– Yemen, where the Houthi rebels are backed by Tehran and Riyadh leads a military coalition supporting the government. Iran and Saudi Arabia also are on rival sides in Lebanon and Syria. 

Recent improvements in relations between the two countries:

  • Negotiations began in Baghdad in 2021 and have taken five rounds so far.
  • Some progress has been made, but the most important or complex case is the Yemen war. Saudi Arabia has declared a unilateral cease-fire, indicating that the country is moving toward new strategies for engaging with Iran.
  • REGIONAL IMPACT:  Renewed ties could scramble geopolitics in West Asia and beyond by bringing together Saudi, a close partner of the US, with Iran, a long-time foe that US and allies consider a threat and the rising role of China in the region.

Rising Role of China in the Region:

  • China’s engagement in the region has for years been rooted in delivering mutual economic benefits and shunning Western ideals of liberalism that have complicated Washington’s ability to expand its presence in the Gulf.
  • China dipped its toes into Middle East diplomacy in 2013 by offering a four-point plan that rehashed old ideas for solving the Israeli-Palestinian conflict. That failed to achieve a breakthrough.
  • China is seizing on waning American influence in the region and presenting Chinese leadership as an alternative to a Washington-led order
  • China’s engagement with the region has been steadily expanding. The GCC states provide 40 percent of China’s oil imports, with Saudi Arabia alone exporting 17 percent.
  • The Belt and Road Initiative (BRI) has been a major factor in attracting China to the region. The Saudi-China joint statement refers to the “harmonisation plan” between BRI and the Saudi “Vision-2030” that was signed during the visit.
  • With increasing role of China, important initiatives have been: the five rounds of dialogue between Saudi Arabia and Iran in 2021-22, Turkey’s outreach to Saudi Arabia, the UAE and Egypt, and the Iraq-Jordan-Egypt consortium set up in August 2021.

Indian’s role in West Asia:

  • Areas of Cooperation:
  • 70 per cent of India’s imported energy needs come from West Asia and 11 million Indians working in West Asia.
  • India is the largest recipient of foreign remittances from West Asia.
  • Close cooperation with West Asia is important to prevent spread of terror outfits like Islamic State.
  • West Asia provides gate way to energy rich Central Asian region. Example: Chahbahar port in Iran.
  • Challenges:
  • India’s deepening strategic relations with Israel has been a concern for Iran. Iran hence, plays its China and Pakistan card. Iran has also supported Pakistan’s stand on Kashmir, going against India’s interests.
  • Iran is a part of China’s ambitious Belt and Road initiative. India has been consistently opposing China’s Belt and Road Initiative.
  • ONGC ‘Videsh Limited’ played an important in discovering the Farzad B gas fields in Iran. However, Iran has not given the rights to develop the gas field to India.
  • India has to work on to balance its ties with Iran on the one hand with USA sanctions and Saudi Arabia and the USA on the other.
  • The two close partners of India like the Kingdom of Saudi Arabia and Iran have reached a deal with Beijing’s influence is disquieting, given India’s current tensions with China.
  • India’s focus on the I2U2 quadrilateral along with Israel, U.S. and UAE, which may have taken the spotlight away from its ties with Iran and Saudi Arabia.
  • India has to closely watch whether Beijing takes its new role as peacemaker to other parts of the world, including the Russia-Ukraine conflict regarding which China has pitched a peace formula
  • China has also sought to emphasize a plan called the Global Security Initiative, that describes an effort to apply “Chinese solutions and wisdom” to the world’s biggest security challenge.

Way Forward

  • I2U2 is the new ‘QUAD’: The I2U2 Group is a grouping of India, Israel, the United Arab Emirates, and the United States. India can play crucial role as far as the region (West Asia) is concerned.
  • India can provide large workforce and leverage on its ties with UAE, the USA and Israel to balance China in the region.
  • India’s approach towards the conflicts in the region should have more clear voice and perception. Clear documents should be issued by the Indian side over this conflict, for example, over Iran and Saudi Arabia

What is Cold Peace?

  • cold peace is a state of relative peace between two countries that is marked by the enforcement of a peace treaty ending the state of war while the government or populace of at least one of the parties to the treaty continues to treat the treaty with vocal disgust domestically.
  • A cold peace is a mimetic cold war. In other words, while a cold war accepts the logic of conflict in the international system and between certain protagonists in particular, a cold peace reproduces the behavioural patterns of a cold war but suppresses acceptance of the logic of behaviour. Cold peace, while marked by similar levels of mistrust and antagonistic domestic policy between the two governments and populations, do not result in proxy wars, formal incursions, or similar conflicts.
  • A cold peace is accompanied by a singular stress on notions of victimhood for some and undigested and bitter Victory for others. The perceived victim status of one set of actors provides the seedbed for renewed conflict, while the ‘victory of the others cannot be consolidated in some sort of relatively unchallenged post-conflict order.
  • Example:
  • Egypt and Israel:
  • The Camp David Accords, the Egypt–Israel peace treaty and the aftermath of relations between Israel and Egypt are considered a modern example of cold peace. 
  • After having engaged each other in five prior wars, the populations had become weary of the loss of life, and the negotiation of the accords and the treaty were considered a high point of the Middle Eastern peace process.

However, Egyptian popular support for the treaty plummeted after the 1981 assassination of Anwar Sadat and the 1982 Israeli invasion of Lebanon, and perception of the treaty has not recovered in the Egyptian populace ever since.

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