I report here the article written by Sabena Siddiqi published by Al Monitor with my comments included.
”KARACHI — As Indian Prime Minister Narendra Modi visited the United States last week for meetings with President Donald Trump, the fate of a strategic Iranian port — into which New Delhi has invested hundreds of millions of dollars — remained uncertain. Washington has ramped up its “maximum pressure” campaign on Tehran, revoking a key sanctions waiver that had shielded India’s involvement in the Chabahar port project.
Unlike Iran’s main port, Bandar Abbas, Chabahar sees minimal trade, but its strategic location has made it a crucial part of India’s regional ambitions. The port serves as India’s gateway to Afghanistan and Central Asia, offering a trade route that bypasses Pakistan.
In 2018, the United States granted Chabahar a sanctions exemption, recognizing its importance in facilitating Afghan trade and strengthening India’s role in the region. Even after Washington withdrew from the Iran nuclear deal, JCPOA, and imposed fresh sanctions, the waiver remained intact — until now.
President Trump’s latest directive instructs Secretary of State Marco Rubio to revoke or modify sanctions waivers that provide Iran with economic relief, explicitly including those linked to the Chabahar project. While Modi’s discussions with Trump did not clarify the port’s fate, New Delhi is reportedly assessing the potential fallout.
With India’s growing strategic ties to the United States, some fear that pressure from Washington could force it to step back from Chabahar. However, Indian officials have long championed the port as vital for regional connectivity, particularly as an alternative route to Afghanistan. As tensions rise, India must now weigh its investment in Chabahar against the broader implications of aligning with US policy on Iran.
More concessions unlikely for Iran
Roberto Neccia, an independent researcher and Iran analyst, told Al-Monitor that Trump’s new approach reflects his administration’s focus on the Iranian nuclear issue. As Tehran has given no clear indication that it’s willing to negotiate, the current “maximum pressure” strategy appears unlikely to include any form of sanctions waivers.
Neccia added that India remains highly invested in the Chabahar project as part of its broader regional strategy. He also suggested that given India’s strong interest in the project, it’s possible that New Delhi has already conveyed its concerns to US officials.
Explaining the reasoning behind the waiver’s removal, Ashok Swain, a professor at Uppsala University in Sweden, told Al-Monitor that Trump has taken a more hard-line approach. The memorandum, he said, specifically targets Iran’s key financial channels — such as oil exports and port operations — marking a shift away from the more tactical concessions Trump employed during his first term.
Zeeshan Shah, an analyst at FINRA in Washington, told Al-Monitor that the Trump administration aims to pressure Iran into negotiations over its nuclear program. As part of this strategy, he said, the United States is “cracking down on any remaining outlets” for Iran’s economic activity, with Chabahar falling squarely into this category.
Diplomatic dilemma for India
At this juncture, balancing relationships with both Tehran and Washington could become a challenge for New Delhi, as it seeks to preserve strong strategic and economic ties with both the United States and Iran. The United States’ increasing pressure on Iran may test the strength of Iran-India relations, and New Delhi could choose to adopt a more cautious approach and wait for a more favorable situation to emerge.
Just last week, Iraj Elahi, the Iranian envoy to New Delhi, discussed Chabahar, highlighting the growth of Iran-India economic ties. He referred to the port, often called the “golden gateway,” as a “key example” of the strong partnership between the two countries.
Meanwhile, Jaideep Mazumdar, the secretary east of India’s Ministry of External Affairs (MEA), recently emphasized that “regional connectivity has been an important pillar of India-Iran relations. The development of Chabahar port in southeastern Iran reflects our joint vision for connectivity and mutual benefits.”
According to Swain, the reimposition of sanctions on Chabahar would strain the “historically stable” relationship between India and Iran, as “India faces a dilemma: abandon the project to maintain US ties or defy Washington and risk economic consequences.”
Noting that Iran’s growing frustration may drive it to seek deeper ties with China, Swain said, “If no waiver is secured, the resulting disruption could cause long-term fissures in India-Iran cooperation.”
Reflecting on whether any pause in Indian operations at Chabahar would impact Iran-India relations, Shah noted that while it could signal to Iran that India is not a reliable partner — leaving Iran in the lurch once again, similar to the collapse of the “so-called peace pipeline” (the Iran-Pakistan-India pipeline) — India has maintained close ties with Iran for over 30 years, essentially replacing the role Pakistan once held during the days of the Iranian monarchy. As a result, Shah said the relationship is likely to remain intact.
India’s stakes in Chabahar
If operations at Chabahar port are halted once again, the future of the International North-South Transport Corridor (INSTC), which connects India to Russia via Iran, could be at risk. Additionally, the port serves as a key gateway for unlocking India’s trade potential with European countries, making its stability essential to expanding India’s regional and global economic ties.
There are also significant implications for India’s relationship with China and Pakistan. Since the launch of the China-Pakistan Economic Corridor (CPEC) in 2015, New Delhi has felt increasingly encircled by Beijing and Islamabad. Chabahar offered India a strategic foothold near Pakistan’s Gwadar port, especially after it signed a tripartite agreement with Iran and Afghanistan in 2016 to develop the port. This move was seen as a counterbalance to CPEC and a key part of India’s broader regional strategy.
In recent years, operations at the Shahid Beheshti terminal — one of two terminals at Chabahar — were managed by a subsidiary of India Ports Global Limited (IPGL). However, progress has been slow, largely due to the impact of Iran’s economic sanctions on private investment companies, which hindered development, preventing the port from reaching its full potential.
Then, in 2024, New Delhi and Tehran finally reached a workable 10-year agreement on Chabahar, and things started looking more promising. Within the agreement, signed between IPGL and the Port & Maritime Organization of Iran, India committed to spending around $120 million more on the port and providing additional financing of $250 million.
As a result, the Indian budget for 2025-26 allocated an annual outlay of 100 crore rupees for the port, despite warnings from the Biden administration about the potential risk of sanctions on any Indian companies engaged in business with Iran.
Assessing whether Chabahar has helped India achieve its goals, Swain described the project as yielding “mixed results.” While it provided India with a strategic alternative to Pakistan’s Gwadar port and a crucial route to Afghanistan, he noted that “progress has been slow.” And despite India’s financial and strategic commitments, the port has yet to realize its full potential as a regional trade hub.
According to Swain, continued uncertainty inhibited further investments, and the port’s success hinges on stable diplomatic ground, which Trump’s policy shift jeopardizes.
Noting another setback for India, Neccia pointed out that New Delhi had recently strengthened its relations with the Taliban leadership in Kabul. Over the past two years, the Taliban themselves have shown significant interest in the development of Chabahar port. But he cautioned that the “economic aspects of this convergence may be called into question if the project is frozen.”
According to Shah, Chabahar has not helped India achieve its long-term goals for a few reasons: Iran’s Sistan-Baluchistan province presents major security issues, the Taliban government in Afghanistan is internationally isolated, and lastly, major Indian conglomerates like Reliance and Adani are not even involved in developing the port for fear of getting hit by sanctions.
As a result, Shah said that Iran has often threatened to end its agreement with India to develop Chabahar.
A bargaining chip?
Pointing out that Trump’s policy reversal highlights the volatility of US-India-Iran dynamics, Swain predicted it could put India in a “precarious position, testing its strategic autonomy and regional aspirations.” He added that Modi may face difficulty in “smartly navigating this diplomatic minefield.”
Ostensibly, Trump may be using the sanctions waiver as a bargaining chip to negotiate trade tariffs more effectively, aiming to reduce New Delhi’s $32 billion trade surplus with the United States.
Moreover, Swain observed that “Trump appears to be influenced by a desire to correct what he perceives as lax enforcement under the Biden administration, and to leverage the port project as a bargaining tool in trade negotiations.”
In Neccia’s opinion, “The future developments [regarding Chabahar] will depend on the possibility that Tehran and Washington can negotiate and eventually reach an agreement on the nuclear issue.”
Therefore, at least for the time being, Chabahar port definitely seems to have hit a roadblock”