India will face challenges on multiple fronts, from energy supplies to connectivity projects, following US President Donald Trump’s decision to withdraw from the landmark Iran nuclear deal.
While this decision might see India importing less oil from Iran, which is currently the third biggest supplier after Saudi Arabia and Iraq, global oil prices are likely to spiral following Trump’s decision, impacting Indian economy, according to people familiar with the development.
India had earlier decided to increase oil imports from Iran in the current fiscal year. Fresh sanctions on Iran will complicate India’s payments for oil imports, reminiscent of pre-deal period when alternative banking channels and methods were used. Trump’s announcement might also impact India’s decision to invest in the petrochemical and fertiliser sector of Iran, including any investment in the hydrocarbon sector. Further, the hit on Iran’s crude exports could fuel tensions in West Asia, key supplier of oil to India and home to seven million Indian diaspora.
Supporting the deal and Iran’s right to nuclear energy, an MEA spokesperson noted: “India has always maintained that the Iranian nuclear issue should be resolved peacefully through dialogue and diplomacy by respecting Iran’s right to peaceful uses of nuclear energy as also the international community’s strong interest in the exclusively peaceful nature of Iran’s nuclear programme. All parties should engage constructively to address and resolve issues that have arises with respect to the JCPOA”.
India has been a strong votary of the 2015 deal between Iran and the global powers as this pact helped to expand energy and business ties besides facilitating operationalization of Chabahar Port through bilateral and tripartite agreements. Impact on India’s role in Chabahar Port that gives access to Afghanistan and Central Asia and beyond though is not yet clear.
Source: Economic Times