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Re-energizing Iran Ties: CHABAHAR GAME CHANGER, By Amrita Banerjee, 1 June, 2016 Print E-mail

Round The World

New Delhi, 1 June 2016

Re-energizing Iran Ties

CHABAHAR GAME CHANGER

By Amrita Banerjee

(School of International Studies, JNU, New Delhi)

Even before India announced Prime Minister Modi’s visit to Iran, it was certain that New Delhi was keen on upgrading ties with this “extended neighbour”.

Pertinently, international interest in ties with Iran has been growing since Tehran and the Group 5+1 (Russia, China, US, Britain, France and Germany) last July finalized a comprehensive nuclear deal and started implementing it January 2016. Called the Joint Comprehensive Plan of Action (JCPOA) agreement it terminated related sanctions imposed on Iran.

Undoubtedly, the removal of sanctions following the nuclear deal ended Iran’s isolation and enabled its return to the economic and diplomatic mainstream. Over the last few months, Tehran hosted several high-profile visitors, including Chinese President Xi Jinping and Italian Prime Minister Matteo Renzi.

Besides, three Union Ministers including Foreign Minister Sushma Swaraj travelled to Tehran over the last few months to step up engagement, revive stalled joint projects and set the stage for Modi’s visit.

The Prime Minister visit ten days ago took India-Iran relations to the next level by bridging the trust deficit in bilateral cooperation, boosting energy and trade ties while expediting New Delhi’s connectivity plans. His visit was the first by an Indian Prime Minister in 15 years and came four months after the sanctions on Iran were lifted.

Notably, his visit was most opportune for the various reasons: One, to diversify and increase India’s oil and gas supplies. Two, enhance connectivity and trade with Afghanistan, Central Asia and beyond. Three, hedge Iran’s geopolitical bets in the region vis-à-vis other players, notably Pakistan, Saudi Arabia and Gulf Cooperation Council members. Four, balance China’s growing influence and engage the US in ensuring that India’s interests are protected in the region.

Keeping our shared history and civilisational ties in mind, Tehran and New Delhi inked 12 agreements, including a pact to develop southern port Chabahar which lies in the Gulf of Oman. Undoubtedly, this port is considered a rebellion against history as the long term potential of its connectivity is immense.

Primarily, as it would alter the geopolitical map of South and Central Asia by providing alternative access to landlocked Afghanistan thereby bypassing Pakistan. This would boost business, trade, economic ties through initiatives like the North South Transport Corridor and help the three countries realize their full economic potential of their friendship which was hamstrung by connectivity problems.

Also this free trade zone offers Indian companies a new investment destination at a well-connected port city. Since the Kandla-Chabahar distance is less than the New Delhi-Mumbai expanse there can be quick movement of goods which would cut transport time and costs by a third.

Strategically too, Chabahar is just 100 km from Pakistan’s Gwadar port, the centrepiece of a $46 billion economic corridor which China is building. Though the Indian investment of $500 million in Chabahar does not match the scale of China’s project, the Iranian port will act as a gateway for India to Central Asia bypassing the China-Pakistan arc.

Further, Chabahar has given wings to Modi’s dream of creating a “vast network of physical and digital connectivity which extends from Eurasia’s northern corner to Asia’s southern shore”.

What's more the new trade route would also ease business with Central Asia’s energy-rich economies as India is the world’s fourth-largest energy consumer and access to Turkmenistan and Kazakhstan’s gargantuan gas reserves would meet its future needs.

Importantly, the political importance being given to the Chabahar project underscores that it is “not just any commercial deal but is one project which is linked to Afghanistan’s future economy and stability that can ensure peace and stability in the Indian subcontinent in the long run.

With the Chabahar project, New Delhi has raised the stakes in Tehran substantially to transform this port into a hub for Indian business. However, India has to make sure that the execution of this project is prompt keeping in mind its past inconsistent record in finishing big projects abroad like the Kaladan multi-modal transport project which was to link the North-eastern States to Myanmar’s Sittwe port.

To oversee its speedy execution, the Union Cabinet has authorized the Finance, Foreign and Shipping Ministers to approve the final contract with Tehran and resolve any issue arising in its implementation. Moreover, it has authorized the Shipping Ministry to form a company in Iran for implementing the Chabahar Port Development Project and related activities.

Certainly, if properly executed, the port’s development can potentially act as a game changer. For the same reason, some US Senators have questioned whether India’s decision to develop the port violates international sanctions or not. Surely, New Delhi would soon clear the air on this when Modi travels to Washington for a “farewell” visit to outgoing President Barack Obama this month.

Additionally, vis-à-vis the energy issue which dominates India-Iran relations, both share the goal of a stable government in Kabul free of Taliban’s influence. Globally, New Delhi and Tehran are on the same page in their opposition towards groups like al-Qaeda and the Islamic State.

The Islamic Revolution leader Ayatollah Khamenei has said that since terrorist groups are recruiting forces in Muslim countries by taking advantage of some problems and weaknesses in this community, combating terrorism must be also be assigned to Muslim States even as he expressed regret that terrorist activities are often wrongly attributed to Islam.

Despite these shared interests, bilateral ties in the past had taken a beating during the sanctions years. India had voted against Iran at the International Atomic Energy Agency over its clandestine nuclear programme and, under pressure from America slashed oil imports from the country by up to 40 per cent during the period. New Delhi also backed off from a pipeline project which aimed to bring natural gas from Iran to India through Pakistan.

But with sanctions removed and foreign countries and companies rushing to Tehran to seize business and economic deals, it is important for New Delhi to reboot and revitalize bilateral relations.

Iran also seems keen on pursuing stronger ties with India. The Iranian Government had expressed interest in expediting stalled projects thus Modi’s visit assumes greater significance in the larger context of his own policy of enhanced engagement with West Asia.

Furthermore, the Prime Minister’s Iran visit comes after his trips to the UAE and Saudi Arabia and ahead of visits to Qatar and Israel. His Government appears to be trying to reach out to the three poles of this region. While it will pursue good ties with the Sunni Gulf for energy supplies, Iran would act as a gateway to Central Asia as also enhancing India’s energy security. Israel remains one of India’s top defence and technology suppliers.

Clearly, the success of this policy depends on New Delhi’s capacity to do the balancing act. The Iran visit should be seen an opportunity to restore equilibrium in India’s foreign policy which, of late, was seen to be skewed towards Israel and Saudi Arabia. ---- INFA

(Copyright, India News and Feature Alliance)

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