US-Iran relations and South Asia’s geopolitics


In the coming months, US-Iran relations will be watched closely in South Asia (the region’s geopolitical landscape will be significantly impacted as it is by the withdrawal of US and NATO troops from Afghanistan).

India’s ties with Iran are economic and strategic (though it had stopped oil imports in 2019 after US ended the waiver which it had provided to India and other countries for import of oil from Iran), it has invested in the Chabahar Port project (during PM Modi’s Iran visit in 2016, India had committed 500 Million USD for development of the port). In December 2018, India had taken over a part of phase 1 of Chabahar Port (Shahid Beheshti).

After India’s decision to stop importing oil from Iran, ties deteriorated between New Delhi and Tehran, and not much progress was made on the Chabahar Project. Iran expressed its displeasure with New Delhi for stopping oil imports from Iran, and also complained that development of the Chabahar Port had slowed down. Significantly, the Trump Administration had stated that Chabahar Project would be free from US sanctions on Iran. A State Department Spokesperson while commenting on Chabahar Port said:

“The exception for reconstruction assistance and economic development for Afghanistan, which includes the development and operation of Chabahar Port, is a separate exception, and is not affected by yesterday’s announcement,”

New Delhi and Tehran have been working towards improving ties ever since the end of 2019.  With the change of guard in Washington DC however, New Delhi anticipated a potential reduction in Iran-US tensions and also a US return to the JCPOA. As a result, it has been paying greater attention to the Chabahar Project, which has been dubbed as its gateway to Afghanistan and Central Asia (India has already used the port on more than one occasion for sending consignments to Afghanistan, and relief materials during the covid19 pandemic). Soon after the victory of Joe Biden in the US Presidential election, India began to pay greater attention to the Chabahar Port and work on it has accelerated since the beginning of 2021.  

It would be pertinent to point out, that Indian PM, Narendra Modi also sent a congratulatory tweet to Iranian President elect Ebrahim Raisi, saying that he looked forward to ‘ working with him to further strengthen the warm ties between India and Iran’

While the Tehran-New Delhi relationship seems to have improved in recent months, Tehran kept India out of the development of the Farzad B gas field (this field had been discovered by ONGC Videsh, the overseas arm of Oil PSU, Oil and Natural Gas Corporation).  Iranian Oil ministry in a statement said:

“The National Iranian Oil Company (NIOC) has signed a contract worth $1.78 billion with Petropars Group for the development of Farzad B Gas Field in the Persian Gulf’

New Delhi responded by saying that Iran would involve India at a later stage in the development of Farzad B.

Iran-Pakistan ties and CPEC

It is also important to bear in mind the fact, that Pakistan-Iran ties have witnessed a significant improvement in recent years.

First, there has been a downward slope in Pakistan’s relations with Saudi Arabia and UAE (though in recent months, Islamabad’s ties with UAE and Saudi Arabia have improved ).

Second, the Iran-China 25 year strategic agreement signed earlier this year, is also likely to result in the expansion of the China Pakistan Economic Corridor CPEC Project towards Iran (Tehran has expressed its willingness to be part of CPEC project). In recent months, China has already been focusing on Afghanistan, as an important component of the CPEC. Chinese Foreign Ministry, Spokesman Zhao Lijian in May 2021 said, ‘ China, Pakistan and Afghanistan are discussing issues related to extending roads and expressways in Pakistan to Afghanistan’.


In conclusion, revival of the Iran Nuclear Deal is likely to take time. The US-Iran relationship is important not just in the context of the bilateral relationship, but is likely to have an impact on the geopolitics of the Middle East and South Asia, as well as important connectivity initiatives of both India and China.

Tridivesh Singh Maini
Tridivesh Singh Maini
Tridivesh Singh Maini is a New Delhi based Policy Analyst associated with The Jindal School of International Affairs, OP Jindal Global University, Sonipat, India


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