Just when Indian diplomats were figuring out how to mitigate the impact of Countering America’s Adversaries Through Sanctions Act (CATSA) on its arms and oil trade with Russia, South Block has another reason to burn the midnight oil. US President Donald Trump’s intention to exit the Iran deal, and reimpose sanctions if Tehran declines to renegotiate, could send India’s plans for the region in smoke. The sanctions will pretty much cover all areas of interest to India vis-a-vis Iran: petroleum, ports, shipping and banking. The bright side is that except for Saudi Arabia and Israel, pretty much the rest of the world has not taken kindly to Trump’s attempt to redefine the Joint Comprehensive Plan of Action (JCPOA) to cover “responsible” behavior by Iran both externally and domestically.
The world can be grateful that Tehran doesn’t have an impetuous leader like Trump. Javed Zarif, Iran’s chief negotiator for the deal, has resolved to diplomatically lobby with the other parties to the agreement. Yet, Trump’s explanation that Iran could emulate North Korea by negotiating denuclearization will find few takers for it is widely realized that Tehran would have to be suicidal if it were to show signs of weakness. On the contrary, the US may have lost North Korea’s trust by going back on the Iran deal just as it lost Palestinian support after Trump announced the shifting of the US embassy to East Jerusalem.
India needs to work with countries with a shared interest in the JCPOA to ensure that Trump’s exit from the Iran deal does not harm its investments and plans for the region. India and other countries on the same page must also engage with Iran to discourage it from retaliatory malign behavior that may further muddy the waters. PM Modi will get the opportunity to discuss the issue with like-minded leaders when he meets them for two multilateral summits later this year. The problem for India is it has no company like the Chinese Sinopec which has no business interests with a US company and can thus escape sanctions. India will first have to make common cause with countries in the same Iranian boat.