Economy, Domestic Economy

Iran, India Open New Chapter in Ties

Iran, India Open New Chapter in TiesIran, India Open New Chapter in Ties

Iran and India are now opening a new chapter in bilateral relations.

The impact of growing ties between the two countries, which have maintained cordial relations characterized by low tension in the past, can even transcend the limits of their bilateral ties, reads an article carried by Eurasia Review.

Iran’s relations with India, which had become restricted to the import of non-essential goods from India in return for selling Iran’s crude to Indian oil companies due to anti-Iran sanctions and because Tehran did not have much of an option, have now entered a totally different phase. This follows the endorsement and implementation of Iran’s nuclear deal, known as the Joint Comprehensive Plan of Action, with six world powers.

Tehran has now more options for the establishment of political and economic relations with various countries. It has entered a new era in its relations with such countries as India and China on an equal standing and on the basis of the realization of its medium- and long-term economic interests.

However, the role played by a country like India in helping Iran go through conditions, which governed its economy from 2007 to 2013 as a result of international sanctions and pressures exerted by the SWIFT network of bank exchanges, cannot be considered totally ineffective in bringing about the new round of those relations.

This is true because economic channels and important companies that had been established among Iran, Russia, China and India to help Iran evade sanctions, were greatly effective in raising Iran’s bargaining power during nuclear negotiations and helped change the imposed course of events.

As a result, following the implementation of the JCPOA–as put by Ali Shamkhani, secretary of Iran’s Supreme National Security Council, during his recent trip to India–Iran has been giving priority to cooperation with countries that stood by it at the time of sanctions and this has been a dominant trend in the foreign policy of the administration of Iran’s President Hassan Rouhani.

 Modi’s Landmark Visit

At any rate, the new round of relations between the two countries started in late May 2016 when India took the first step and its Prime Minister Narendra Modi paid an official visit to Iran. It was the first visit to Iran by an Indian official at this level in the past 15 years.

In the meantime, a recent visit to New Delhi by Shamkhani and his meetings with the Indian prime minister and his national security advisor, Ajit Doval, were considered as Iran’s response to Modi’s Tehran visit and a sign of deepening bilateral relations.

During these exchanges, both sides emphasized the need to promote bilateral relations in political, security, defense and economic fields while the Indian government asked for further strengthening of strategic dialogues among Iran, India, China and Russia over security, political and economic issues.

The results of such cooperation and dialogue have been already manifest in certain fields and have a bright prospect in other fields.

 Chabahar Pact, Manifestation of Development-Based Ties

The agreement signed for the development of Iran’s southeastern Chabahar Port is an objective manifestation of the new chapter of relations between Iran and India on the basis of development.

This agreement, which was signed by Iran, New Delhi and Kabul during a concurrent visit to Iran by the Indian prime minister and President of Afghanistan Ashraf Ghani, is of special importance because it pursues such goals as activating the International North-South Corridor and bringing prosperity to transportation plans of the three countries.

The remarkable increase in the productivity of marine transport in the Sea of Oman, making many commercial ships needless of entering the Persian Gulf and traveling longer distances, and the development of one of the deprived regions of Iran are among major goals, which can be achieved as a result of this trilateral agreement. These advantages have become associated with the Rouhani administration’s special effort to provide political and economic impetus ti the facilitation of this tripartite cooperation.

Attracting investment from India in line with this development plan will boost the capacity of Iran’s Chabahar Port in loading and unloading commodities to 84 million tons per year. All these developments will result from the implementation of an agreement, which is hoped not to meet the same fate as the Peace Pipeline project that was supposed to take Iran’s natural gas to India via Pakistan and would not be obstructed by western countries that are bent on blocking development projects that unite developing countries.

According to what the secretary of Iran’s Supreme National Security Council said during his visit to India, the two countries have also decided to revive a document of strategic cooperation that was signed by the two countries’ heads of state in 1998. Before that, due to various obstacles and limitations resulting from anti-Iran sanctions, the implementation of that document had not been possible and now, following the implementation of the JCPOA, it can be taken as a basis for more cooperation.

In addition to the outlook of future plans to be implemented by Iran and India, what has been observed in the short run is increased volume of bilateral trade.

According to available statistics, following the implementation of JCPOA, India has increased Iran’s share in its oil market by, at least, 10% as a result of which India’s biggest oil importing company bought a daily total of 185,000 barrels of Iran’s crude oil last month.