India-Iran Relations

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  • Why India-Iran relations are mutually beneficial?
    1. Energy:
      • India can decrease the dependence on Saudi for oil and Iran oil is comparatively cheap
      • Iran has the world’s second-largest reserves of natural gas, yet it is not a major exporter.
      • Iran has several challenges to overcome before it can become an energy supplier to Europe and Asia. Iran’s energy infrastructure – long neglected as a result of Western sanctions – requires major upgrades to make it capable of sustained energy exports.
      • This will require massive foreign investment and India can tremendously help here.
    2. Chabahar port:
    3. Role in Afghanistan:
      • Iran-Afghan railway link:
        • India is currently involved in constructing a 560 mile long railway line linking the Iranian port with the iron ore mines in Hajigak in southern Afghanistan.
      • The railway link when completed will potentially afford India some strategic benefits including –
        • Increasing India’s position and leverage in Afghanistan and the central Asian region. This affords India an easier connection to Afghanistan after avoiding Pakistani blockages.
        • Apart from the impact on security and regional politics this more importantly implies that Indian companies will have opportunities to start exploration over Afghanistan’s mineral wealth which is estimated to be close to $3 trillion. (This alone is over double the size of India’s economy.)
      • Both Iran and India share the goal of a stable government in Kabul free of the Taliban’s influence and not revert to the Taliban-controlled Pakistani client state that it was in the 1990s. To that end, India and Iran must engage each other to strengthen the hand of the government in Kabul.
    4. Industries:
      • Iran believes that India fulfils a substantial part of Iran’s needs. For example, India is very capable in steel, in aluminium, in mines and metals, railroads, software, IT, technology and so on. There is a lot of demand in these sectors in Iran.
      • One of the biggest advantages in recent times is that Indians are offering a credit line to the Iranians. That’s a very substantial element in the hands of the Indians to offer for different projects to Iranians and this credit, which is in rupees, is beneficial to Indians. According to the financial structure, Indian companies will benefit from it, the rupee will benefit from it.
    5. Geopolitical:
      • Iran would act as a gateway to Central Asia
      • After removal of sanctions the significance of Iran geopolitically has increased.
      • Central Asia is going to be the scene of renewed great power rivalry, and India must act, not as a mere spectator, but as a leading player.
      • Notwithstanding Iran’s growing bonhomie with Pakistan and China, India must stay in close contact with Iran and consciously and consistently pursue good diplomatic and economic relations with it.
    6. Terrorism:
      • Globally, New Delhi and Tehran are on the same page in their opposition towards groups like al-Qaeda and the Islamic State.
      • Increasing hold of ISIS  is a threat to Iran and with India effective efforts against terrorism India can be a attractive partner
    7. Culture:
      • India has the 2nd largest population of Shias in the world after Iran some of whom probably also have ancestral ties to Iran. This ties back to a complex political situation in India. Religion and national allegiances play a large part in Indian politics and this is magnified with the upcoming elections.
    8. Other projects:
      • India has been vigorously pursuing the Iran–Pakistan–India (IPI) gas pipeline project for the last decade. The operation of the IPI project would be reinforced by the trilateral “Framework Agreement,” in which the three governments would be committed to the provisions of the Energy Charter Treaty
      • With the Iran-Pakistan-India (IPI) pipeline still stuck and the Turkmenistan-Afghanistan-Pakistan-India (TAPI) pipeline yet to take off, India is very keen to kick-start an undersea pipeline project that would bring Iranian gas to India via the Arabian Sea bypassing Pakistan.
      • This is  a great opportunity for India to transport natural gas from Iran to Porbandar port in Gujarat
      • Zaranj-Delaram Highway is being built with financial support from India.
      • A strategic partnership between India, Iran and Russia is intended to establish a multi-modal transport link connecting Mumbai with St Petersburg, providing Europe and the former Soviet republics of Central Asia access to Asia and vice versa.
      • Iran may also provide connectivity to Central Asia and Europe, via the International North South Transport Corridor(INSTC), which is estimated to be 40 percent shorter and 30 percent less expensive than trade via the Red Sea-Suez Canal-Mediterranean route.
Why Iran is more than just an Oil Supplier to India?
  • Iran ensures overland connectivity between Eurasia and India and it is not just an energy supplier.
  • Iran is a land power on the other side of Pakistan that provides India with an alternative route to Afghanistan, a strategic necessity for Delhi.
  • Iran is a geopolitical entity in its own right.
  • Iran has borders with a large number of countries that India could not access because of the barrier that Pakistan posed to India’s overland connectivity plans.
  • India’s relationship with Iran has been built carefully and thoughtfully by all past governments as Iran for India is not just an energy supplier from the Persian Gulf region.
  • India’s infrastructure-building activities in Afghanistan is done with support from Iran.
  • India has disregarded political inclination of the government in Tehran with an eye on the overall necessity of the country for India’s strategic security.