Iran: A Challenge to India’s Strategic Autonomy

Sameer Mallya 2013-07-30

Indo-Iranian relations have been one of the toughest ones to manage for the Indian political elite, especially when viewed in the wake of the newfound bonhomie with the US. India's votes at the IAEA against Iran along with the stallingof the LNG and Iran-Pakistan-Indiapipeline deal have been perceived as an Indian compromise with its long held strategic autonomy in itspolicy towards Iran.

Nonetheless, there is sufficient evidence to prove that despite having difficulties, India has adhered to its strategic autonomy guided by its national interests. The Indian vote against Iran is purely a result of lack of transparency as well as lack of cooperation by Iran with the IAEA. However India supports Iran’s quest for peaceful use of nuclear energy as it is a signatory to the NPT and encourages Iran to be more compliant and transparent with its nuclear programme. India’s refusal to comply with unilateral sanctions imposed by the US or EU and adherence only to the UN sanctions also is an indicator of its strategic autonomy. In addition, unlike the US and Israel, India strongly believes in constructive engagement thus providing more room for dialogue than for sanctions and military strikes.

India requires Iran for its energy security as well as for extending its influence in Afghanistan and Central Asia. India and Iran have played a constructive role and have congruent interests in Afghanistan. Refusal of transit by Pakistan makes Iran the next best commercially viable route for India to access Afghanistan, which will become all the more vital from economic, military as well as strategic points of view especially post-US withdrawal from the region which is slated to start in 2014.

Due to sanctions, the Iranian economy lacks sufficient foreign reserves and so has come up with some lucrative offers like Production Sharing Agreement (PSA) to attract foreign capital in its energy sector. Problems of payment of oil bills to Iran have resulted in reduction in import of oil from Iran. The current Indian approach of diversifying its trade relations with Iran especially in the non energy sector serves two purposes— One, it is trying to capitalise on the economic difficulties of Iran by using the Rupee payment arrangement to increase its exports and thus reduce the trade imbalance that is heavily loaded against it. India’s exports to Iran are about 10 per cent of its imports from Tehran. Capitalising on the situation created by sanctions makes economic sense and at the same time helps sustain momentum of engagement. India also is considering going in for the PSA offered by Iran in the energy sector including one for developing the Farzad B gas field by simultaneously weighing the cost of sanctions. The problem of Iran’s lack of LNG infrastructure has been dealt with by Iran offering to ship gas to India in liquefied form through Oman. Iran has also agreed to accept all the oil payments in Indian Rupees.

These are some of the important pointers which show India continues to engage Iran despite US pressure- a marker of India’s strategic autonomy. The role of US vis-à-vis Iran comes to the fore because of India’s own strategic compulsions in relation to US.India needs to foster its strategic relations with the US in order to realise its quest to become a global power. The Indo-US interests converge when it comes to Iran’s suspected nuclear programme which the West allegesis for the development of nuclear weapons. India's stance is clear in this regard — it does not prefer another nuclear armed state in its neighbourhood. The US is apprehensive of a nuclear-armed Iran threatening its interests in the region.

The Indo-US Civil Nuclear Agreement, signed on 2ndMarch 2006,was firmly anchored in the US Hyde Act. According to section 3 (b4) the President should:

“…(s)ecure India’s full and active participation in United States efforts to dissuade, isolate, and if necessary, sanction and contain Iran for its efforts to acquire weapons of mass destruction, including a nuclear weapons capability( including the capability to enrich or process nuclear materials), and the means to deliver weapons of mass destruction.”

Critics of the nuclear deal highlight this particular clause as an attempt by the US to restrict India in its dealing with Iran.  However it needs to be borne in mind that it is only an advisory clause and not legally binding. Thus,India continues to retain ample space to practice its strategic autonomy while dealing simultaneously with Iran as well as the US.

The Indian approach may be perceived as ad hoc and as lacking strategic insight. It also cannot be completely denied that there have certainly been a few hiccups in India’s stand towards Iran as was evident in the case of India facilitating the launch of an Israeli spy satellite used against Iran, delays in development of the Chabahar Port as well as the closing of its Asian Clearing Union which was used in transactions with Tehran. However keeping in mind the domestic and international pressures India has to face while dealing with Tehran, its approach vis-à-vis Iran has been commendable.  India's readiness to work with Tehran stems from careful, hard-nosed calculations of what it deems to be in its vital interests. These may well diverge with those of the United States, Israel, and much of the Western world. Nevertheless, they cannot be dismissed as being either unreasonable or irrational.

By Special Arrangement with The Centre For Land Warfare Studies (CLAWS) (http://www.claws.in)