When they hold their next Foreign Office consultations on Monday, India and Iran will review the same list of issues in new circumstances brought about by the promise of easing U.S. sanctions.
“Relations with Iran have been held up due to the U.S. sanctions. The talks have created a new atmosphere for the Peace Pipeline via Pakistan,” says Chintamani Mahapatra of the School of International Studies, Jawaharlal Nehru University.
Despite India having walked away from talks on the Iran-Pakistan-India (IPI) Peace Pipeline citing security concerns, Iranian Deputy Minister for International and Commercial affairs Ali Majedi on Saturday expected New Delhi to overcome its doubts and join the project.
Government officials advised caution as some ground remained to be covered in the nuclear talks but felt the vibes generated by the just-ended Geneva Round will bring Iran into the Afghanistan game which will be to India’s advantage. Both Iran and India are concerned over the U.S.-Pakistan initiative to hold peace talks with the Afghan Taliban without preconditions. “If the U.S.-Iran ties improve, Tehran will be inclined to play an increasingly constructive role in Afghanistan,” noted Srinath Raghavan, Senior Fellow at the Centre for Policy Research.
Officials say modernisation and expansion of the Chah-bahar port will be vital for providing India and the international community access to Afghanistan and Central Asia. It will also ensure Indian presence just 80 km away from the Chinese built Gwadar port in Pakistan. India has allotted $100 million for the port’s development and is sorting out a trilateral arrangement with Iran and Afghanistan for a customs and transit agreement.
Senior Iranian officials see the Shahid Beheshti Port and its contiguous free trade zone as crucial for Afghanistan’s economic growth and say that over the past one year there has been tangible progress in moving the concept forward during high level interactions with Indian officials. But Mr. Raghavan says in conversations with Indian interlocutors, Tehran has not been clear about New Delhi’s role. Prof. Mahapatra expected a push for the North South Corridor that will use the Bandar Abbas port for connectivity with Turkmenistan, the Caucasus and beyond.
The port can be connected to Afghanistan and even beyond to Central Asia by linking it up to the Iranian border town of Milak on the Afghan border. An Indian-built road from the corresponding Afghan border town of Zaranj will then lead to the Afghan garland highway.
In the first trilateral, India, Iran and Afghanistan agreed on preferential treatment and tariff reductions for Indian goods at Chah-bahar. There is now talk of a rail line from Bamyan in Afghanistan that will follow this road route down to Chah-bahar.
Stepping up oil supplies
Government sources expected Iran's major Indian clients for oil to enter into hectic negotiations for stepping up supplies after having been forced to reduce consumption due to the effects of the U.S. sanctions on insurance and sending back payments. Officials say India has managed to stay in the good books of the U.S. because its rate of reduction has been much higher than other major consumers of Iranian oil.
This would also mean the plan to create a Rs. 2,000-crore fund to provide cover for imports of Iranian crude can easily be shelved for the time being.
India will also be looking at resuming talks on a lucrative gasfield — Farzad-B gas — on which just two rounds have been held over the past four years. Sources said although the two sides did not meet too often, they managed to agree on all issues but for the internal rate of return and security of investment.
Analysts and government officials feel that years of regular, high-level contacts with the top Iranian leadership should yield dividends in intra-Asian security, trade and energy linkages. This is something Iran also feels was a missing factor in its dealings with the world. “We kept looking at Europe for too long,” Iranian Ambassador in India Gholam Reza Ansari told The Hindu earlier.
