The emergence of Iran

India must deepen its economic, strategic ties with Iran

The visit of Prime Minister Narendra Modi to Iran has been carefully scrutinised, and for good reason. It comes at a time when the Islamic Republic, freshly empowered by an agreement on its nuclear programme that allows it to emerge from a years-long debilitating regime of international sanctions, is poised to connect with the world again. In that period of isolation, in spite of some adverse votes in international forums, India maintained a comparative independence from the West-led sanctions regime. How much credit that buys with the Tehran establishment remains to be seen, as also whether India can take advantage of it before foreign companies from the developed world and East Asia. Thus, connectivity and economic relations topped Mr Modi’s agenda; the highlight of the visit was a trilateral agreement signed on transit through Iran’s Chabahar port – in the presence of not just Mr Modi and his Iranian counterpart, Hassan Rouhani, but also the president of Afghanistan, Ashraf Ghani. One major purpose of Chabahar has always been to cut Pakistan out of the route between India and Afghanistan; Mr Ghani referred to this explicitly, saying no countries are prisoners of geography, “we can change it through our will”. Several memoranda of understanding were signed on the occasion, including for railway services and aluminium manufacturing. Shipping Minister Nitin Gadkari, who accompanied the prime minister, said that potential investments in the area around the port might total over Rs 1 lakh crore, including those for petrochemicals and natural gas-based industries in the Chabahar area.

This is a hopeful development. However, several caveats apply. One is that the port itself, with a relatively modest capacity,  must not become a casualty of dilatory work by the Indian agencies responsible. The second is that ambitions must not be moderate – should indeed be expanded. Not just Afghanistan, but all of Central Asia should be opened up to trade with India through Chabahar. Mr Modi did mention linking up with the International North-South Transport Corridor, which goes from Iran through Azerbaijan and then further north into Russia. But the Central Asian ex-Soviet republics, which are poised for a renaissance, should also be on India’s mind. India has been rightly wary of the Chinese international infrastructure investment programme that goes by the name of “One Belt, One Road”; but the extent that it plans to link Iran to eastern China through Central Asia should not be ignored in the development planning for Chabahar.

Apart from connectivity issues, regional security and counter-terrorism were also on the agenda. Mr Ghani began his tenure by being more friendly to Islamabad than his predecessor, but a series of bloody strikes in Kabul have tested his patience. Meanwhile, Iran has just held a major military exercise on its border with Pakistan. The joint statement released by the Iranian and Indian prime ministers specifically condemned “states that aid, abet and indirectly or directly support terrorism” and referred to “sanctuaries” for terrorist groups. On both security and economic grounds, therefore, the re-emergence of Iran has given India a big new card to play in its neighbourhood. It must use the additional strategic space wisely, and follow up on commitments swiftly.