India and Iran: Navigating Geopolitical Challenges.

Byline: Behrawar Shahnawaz

As geopolitical shifts and external pressures impact the regional landscape, the once-promising economic ties between India and Iran face considerable challenges. Establishing new trade patterns and fostering connectivity across Eurasia has become a daunting task, hindering the positive trajectory of their economic relationship. The current regional geopolitical environment significantly hinders bilateral trade between Tehran and New Delhi.

India's burgeoning relationship with Washington has emerged as a significant hurdle, placing New Delhi in a precarious position as it strives to navigate between the US-led and China-led blocs. Complicating matters further, Iran finds itself targeted by global and regional powers, and its economy and social fabric are severely impacted by sanctions imposed by the US and its allies. These intertwined factors create additional complexities for India as it seeks to strike a delicate balance amidst these geopolitical challenges. Washington's sanctions on Tehran under CAATSA led to the stoppage of oil imports from Iran in 2018, hurting India's energy security. Nonetheless, both nations are finding alternative trade patterns and are interacting on platforms like SCO to boost their commercial ties in the current geopolitical environment.

Oil Trade Resumption Iran remained a reliable energy partner for years until New Delhi backed out under pressure from US President Donald Trump. The Trump administration imposed CAATSA sanctions on the clerical regime, causing New Delhi to stop purchasing oil. Nevertheless, Tehran applauds India's stance on Ukraine and continues to buy oil from Moscow, resisting Washington. According to the Hindustan Times, Iranian ambassador Iraj Elahi said, "India resisted the pressure of the West to buy Russian oil and hoped that Delhi starts buying oil from Iran as well." Iran relies on New Delhi to resume crude oil imports, strategically evading American pressure by exploring non-dollar payment methods to counter-sanctions.

As the Islamic Regime needs a big consumer, it will satisfy 80% of the energy needs of New Delhi at a low cost if the oil trade resumes. The shift away from the US Dollar New Delhi and the Islamic Republic have joined the de-dollarization drive together with Beijing. Several nations are considering using their national currencies to substitute US dollars in international transactions. The Islamic Republic seems to be taking a cue from India by...