India-Iran: a fundamental renewal
India finds itself in the long queue of global economic powerhouses that wish to avail the new opening between Iran and the international community. But India’s proximity and mutual interests of the two countries indicates that the time is ripe for a fundamentally new beginning in Tehran-Delhi relations.
As Iran and the six world powers gear up for the implementation of the historic agreement over the Tehran’s nuclear program concluded earlier on 14 July, Indian leaders and businesspeople share an equal, authentic concern: how to win the lion’s share of Iran’s lucrative market of 80 million consumers, surpass the avaricious international competitors eyeing the country’s energy industry and forge closer ties with a nation that is expected to emerge strong from more than a decade of paralyzing economic sanctions.
Iran and India have historic, cordial and untroubled relations, despite some hiccups during the U.S. and European Union economic sanctions of the past 12 years. The bilateral is now stepping up – hopefully to potential.
Till 19 August, 2015, Iran was on India’s restricted visa list, and its citizens were required to go through prior referral category (PRC) security and intelligence checks before being granted visas. The P5+1 comprehensive nuclear agreement of 15 October, 2015, gave India room to lift the visa restriction and give Iranians more leeway. Around40,000 Iranians visit India annually and hopefully this number will now increase.
Beyond tourism, Tehran and Delhi are gearing up for a serious shift in strategic trade and diplomatic ties. Prior to the European Union oil embargo of July 2012, India was Iran’s second largest crude client after China, preceding Japan and South Korea. From January to June 2011, India imported 13% of Iran’s oil, temporarily becoming Iran’s largest oil customer in January 2012. But the oil embargo and additional U.S. sanctions caused India to reduce its crude imports by 11%, to 113.6 million barrels per year,
Since July 2015, a number of high-ranking Indian politicians have been making tracks to Tehran, and these visits were reciprocated by Iranian officials traveling to Delhi to convey Iran’s willingness to embrace India as a reliable, strong ally.
First off the tarmac in Tehran was Nitin Gadkari, Indian Minister of Road Transport, Highways and Shipping who came in May, before the signing of the nuclear deal, to discuss the development of the strategic Chabahar Port in southeastern Iran. He said that India is primed to invest $15.2 billion in major projects in Iran, including the full-scale development of Chabahar, regarded by India as vital To counterbalance the Chinese presence in the Pakistani port of Gwadar, connect India to Afghanistan through a railway line (to be built by Ircon International) and most importantly, open up a route for India to link to the International North-South Transport Corridor – a ship, rail and road route that connects India, Russia, Iran, Europe and Central Asia – and scope out new ties with Central Asia.
Gadkari was followed by former Finance Secretary Rajiv Mehrishi, (now Home Secretary) who led a delegation of Indian businesspeople and banking executives from 25-27 July to discuss new avenues for reviving trade and banking connections between the two nations. Indian refineries owe around $6.5 billion to Iran, an OPEC member state, for the oil imports they haven’t been able to liquidate due to the international banking sanctions. Settling these dues legally was a priority for Mehrishi. Iran has cut India some slack; the Iranian Ambassador to India Gholamreza Ansari said on 22 July, 2015 that there’s no “emergency or urgency” in getting back this corpus, which accounts for about 2.2% of Iran’s annual budget in the fiscal year 2014.
India also relies on Iran, a major Muslim power, to withstand the potential threat posed by the Islamic State. New Delhi believes that Iran, with its close links to Pakistan and its clout over Syria can – at least partially – repel terrorism before it reaches its borders. So when Iranian President Hassan Rouhani and the Indian Prime Minister Narendra Modi met on 9 July on the sidelines of the BRICS/SCO summit in Ufa, Russia, Modi named “connectivity, energy, trade and investment and terrorism” as the main priorities discussed by the two leaders.
In what signaled Iran and India’s growing mutual willingness to quickly race towards realizing their potential for the strengthening of trade and commercial ties, the two nations held the 18th session of the India-Iran Joint Commission in New Delhi on 28 December, 2015. The session was chaired by the Indian Minister of External Affairs Sushma Swaraj and Iran’s Minister of Economic Affairs and Finance Ali Tayebnia. A major area of discussion was India’s involvement in the development of Chabahar Port and Chabahar Free Trade Zone, a high priority for both governments.
India finds itself in the long queue of global economic powerhouses such as Australia, Britain, France, Germany, Italy, Japan, South Africa and South Korea that wish to avail the new opening between Iran and the international community and foster trade, commercial, cultural and political relations. But India’s proximity and mutual interests of the two countries indicates that the time is ripe for a fundamentally new beginning in Tehran-Delhi relations.
Kourosh Ziabari is an award-winning Iranian journalist, media correspondent and peace activist.
This article was first published on Gateway House. You can read the original article here.