Guest Post by Atifa Amiri*

The tension between the United States and Iran may seem to originate from the latter’s nuclear program but the root of the issue stems from the conflicting interests in the Middle-East. According to the national security of the United States of America in 2006, the major interests of the United States include:

• Providing security for the oil and gas supply.

• Maintaining Israel’s existence and qualitative military advantage.

• Eliminating threats from terrorist organizations.

However, the United States maintains broader interest in stabilizing the Middle East region. For example, the U.S claimed that its major goal is to promote democracy and economic liberalization in the region. Ironically, Iran is not under U.S. influence regarding its transportation, oil, and gas production.

The U.S. also claims that Iran is meddling with Iraqi Shia groups and preventing stabilization of Iraq, and that Iran is the greatest supporter of Hamas and Hezbollah in the region.

In summary, U.S policy towards Iran in the post-cold-war period is influenced by two factors: 1) Iran’s geopolitical importance made it even more significant for the United States to contain the USSR on its southern flank, and 2) Iran possessed rich Oil and gas resources.

In order to protect its homeland, the U.S. continues to leverage its resources and to ensure that Iran does not initiate the use of nuclear weapons.

Iran Interest

There is no doubt about Iran’s interest to spread its influence over a massive part of the Middle East.  Iran has invested and sacrificed significant amounts of blood and capitol to ensure that it is able to determine the course of events in Iraq, Syria, and Lebanon.

To a lesser extent, it has sought to establish a beachhead in Yemen, and it has sought out links to groups in the Gaza Strip, Bahrain, Kuwait, Saudi Arabia, and elsewhere in the region. 

If Iran perceives its revolution as pan-Islamic, as U.S. partners in the region certainly believe, then it might very well set its sights Beyond Damascus and Baghdad.

From this perspective, the conflict between Iran and its rivals is less a product of Iran’s expansionist goals as it is a classic security dilemma, intensified by ideological differences that render both sides more suspicious of the other’s intentions.

If this is the case, then a U.S. policy that seeks to simultaneously reassure Washington’s allies in the region, while also providing the Iranian regime with guarantees that its interests in the region would be respected, could lay the groundwork for less confrontational relationships.

Impact on Indian Political Economy

India has approached the situation with cautious optimism. India has historically pushed for peaceful resolution of the nuclear issue, emphasizing diplomacy and dialogue. India’s approach to Iran’s nuclear complication evolved from one of indifference and ambivalence to encouraging Iran to adhere to its Non-proliferations Treaty or./o (NPT) commitments; politically supporting the efforts of the International Atomic Energy Agency or (IAEA) enforcing the subsequent UN Security Council sanctions imposed, and strongly endorsing the U.S.-led P5+1 negotiations.

Therefore, India stopped short of negotiating with the U.S. and its European allies when they imposed unilateral sanctions, and New Delhi continued to work with Iran on other issues.

Moreover, New-Delhi was the second-largest supplier of Crude Oil before sanctions hit in 2012. The crippling nuclear sanctions levied by the United States in 2012 engineered a deep-seated transformation in Tehran’s calculations. 

New-Delhi has repeatedly voted in favor of the International Atomic Energy Agency (IAEA) resolutions against Iran on the ground that a nuclear Iran is not in India’s interests.

On the issues of energy relations, India claims that Iran is an important partner as well as an important source of hydrocarbon resources and that it is keen to further strengthen existing ties.

Iran was one of the largest suppliers of crude oil and, in return, India has supplied refined petroleum products for Iran. Therefore, the U.S. has been applying pressure against Indian companies that have energy relations with Iran.

The sanctions have led to a downturn economy in Iran, so they insisted the sanctions were illegal and had attached no credibility to the waivers.  

IPI is the most prominent or (India-Pakistan-Iran) gas pipeline project. Iran and Pakistan have announced that they will move forward with the project at a bilateral level for the time being.

Geopolitical Factors

India is trying to balance its relations between both countries. While increasing ties with the United States, India still ultimately seeks to progress toward an “equitable international order” and a “truly multipolar world, with India as one of the Poles.”

In this goal of ending Uni-polarity, India’s long-term plan with Iran is manifested in the relationship to Tehran with its clear preference for reducing the United States’ power in the region.

India’s growing ties with the United States help shape how Delhi approaches its interests in Iran as well as in the U.S. The U.S. and India share many interests in Central Asia. These include ties to Iran, and relatedly, hope for Afghanistan. India-Iran relations set up a key area of contention between New Delhi and Washington. This has caused Delhi to slow engagement with Tehran.

The 2001 Tehran and the 2003 Delhi Declaration further enhanced the relationship between the two countries, providing structure to economic Cooperation.

Indo-Iranian bonds faced pressure during negotiations for the Indo-U.S. nuclear deal, which took place during 2005 and 2008. Therefore, the United States agreed to grant India full civil nuclear cooperation in exchange for separating its civil and military nuclear programs. For India, this meant economic advantages as well as a symbolic victory; India was recognized as a legitimate Nuclear power by the global hegemon.For America, the deal strengthened relations with one of the world’s major rising powers and acted as a counterweight to China.

However, during the Indian Prime Minister’s visit to Iran in 2016, U.S. lawmakers questioned Delhi’s readiness to sign a formal security cooperation agreement with Washington.

The State Department Responded that the U.S. government had clearly conveyed its concerns and that Delhi had been “very responsive…to our briefings” and “to what we believe the Lines are.” The Chamber port was tolerated by Washington due to its role as a counterweight to China’s Gwadar port in Pakistan, which is considered superior in trade capacity for the Sistani-Baluchistan region.

United States’ Attitude Toward Indo-Iran ties

The United States’ attitude toward Indo-Iranian relations is also influenced by Israel’s interests.

Tel Aviv has significant concerns regarding Indo-Iranian ties. This is partly because Israel is one of India’s top arms suppliers. During 2003 and 2004, the United States and Israel encouraged India to minimize its relations with Iran in terms of defense, energy, and strategic relations With Iran.

During the Israeli President’s visit to India in 2016, the president clearly stated his concerns regarding India’s friendship with Iran. Israeli media felt the need to publish assurances by PM Modi that India would support to prevent Iranian attempts to harm the Jewish state.

 Israel’s concerns created further motives for the United States to convince India to reduce its Iran ties. Consequently, the Indian foreign minister condemned the incident. That means that Delhi follows its interests through ties with multiple powers, regardless of their animosity toward each other. No other major power could maintain amicable ties to all three states with animosity towards each other.

India shares interest in instability in Central Asia with Iran and an interest in fighting terrorism with all three countries. Delhi’s approach of walking both sides was also demonstrated when Bush and Singh administrations were attempting to convince the U.S. Congress to accept legislation in favor of the India-U.S. nuclear deal. Much of this occurred when the Iran nuclear crisis was deepening.

However, Washington politicians expected India to lean more toward U.S. positions on global affairs. As a result, there was increased U.S. scrutiny of India’s Iran relationship.

Former Indian Security officials were aware that the deal was framed to the American Saudi Arabia and the Gulf States, while India and Iran maintain very different relations with Gulf countries. Continues[BL1]  to increase strategic ties with states such as Saudi Arabia and the UAE, Tehran’s relations with these states are at historic lows.

Similar to its strategy toward The United States, India has managed to increase ties independently with both Iranian and Saudi poles in the region. Over the last decade, India has expanded political engagement, security agreements, and defense cooperation with Gulf States. This has occurred on top of Delhi’s existing dependence on the Gulf for energy and remittances from labor exports. These priorities outweigh India’s economic interests in Iran.

Under the influence of its Crown Prince, Mohammed Bin Salman, Riyadh has elevated its rivalry with Tehran as a Defining Feature of its relations with other states. This has led to divisions within the Gulf Cooperation Council (GCC), such as the blockade against Qatar.

Oil Trade between India and Iran from 2010-2017

Iran remains a key part of India’s objective to alleviate energy poverty, the key to the latter’s access to Iran’s surplus hydrocarbon reserves and opportunities for investment in upstream oil and gas exploration.

Iran was India’s second largest crude oil supplier after Saudi Arabia until 2010-11. In 2014-15,  India bought 11 MT and 10,95 MT from it. 

Overall, Iranian exports to India followed the trends in oil trade, peaking in 2012 ($13.3 billion) and dropping to a low in 2015 ($6.2 billion). These exports included fertilizers, organic and Inorganic chemicals, petroleum and its products, fertilizers, plastic, edible fruit and nuts, glass, pearls, and precious and semiprecious stones.

India is possibly one of the most energy-deficient of all rising powers. Iran is third-large rest supplier after Iraq and Saudi Arabia, it supplied 18.4 million ton of crude oil during April 2017.

In 2006, India’s Crude oil imports from Iran sat at $4.35 billion, 10 percent of total crude oil Imports. In 2008, Iranian crude oil imports grew to $11.2 billion. Prior to sanctions, Iran was the second largest oil supplier to India.

However, after sanctions had been imposed, they dropped down to $3.7 billion in 2015. The U.N. and EU sanctions were lifted in January 2016 following the conclusion Of the Joint Comprehensive Plan of Action (JCPOA).

After this, an arrangement was reached between Delhi and Tehran to process India’s pending oil payments to Iran, unlocking $6.4 billion installed funds. India’s imports of crude oil from Iran in 2016 grew to $6.68 billion or 11 percent of total crude oil imports. In October 2016, Iran was India’s top supplier.

India’s approach to Iran’s nuclear imbroglio evolved from one of indifference to encouraging Iran to adhere to its NPT commitments; politically supporting the efforts of the IAEA; enforcing the subsequent UN Security Council sanctions imposed, and strongly endorsing the U.S.-led P5+1 negotiations.

However, India stopped well short of bandage with the U.S. and its European allies when they imposed unilateral sanctions, and New Delhi also continued to work with Iran on other issues in different fora.


India and Iran have managed to foster a multifaceted relationship, anchored within a long history of cultural ties and affinity. For India, this relationship is governed by geopolitical and economic concern that utter the terms of bilateral ties, including energy trade, infrastructure development, and security cooperation.

Geopolitically, New-Delhi sees a strong relationship with Tehran as a significant gateway to Central Asia, a means to break a strategic encirclement by china and to minimize the influence of Pakistan and potential partnership in counter-terrorism. Despite of the sanctions both the countries were very successfully able to operationalize the chabahar port project which is connecting India, Iran and Afghanistan with further prospects of connectivity to Eurasia.

*Author: Atifa Amiri student of MA. Political science at Jamia Milia Islamia (JMI) University New-Delhi