New Delhi: In a concerning move for India, the Trump administration’s order on its “maximum pressure” campaign against Iran explicitly raises the possibility of the sanctions waiver for the Chabahar port being revoked.
The decision is part of the National Security Presidential Memorandum signed by President Donald Trump, which aimed to impose “maximum pressure” on the Iranian government.
The memo directed that the US secretary of state “shall modify or rescind sanctions waivers, particularly those that provide Iran any degree of economic or financial relief, including those related to Iran’s Chabahar port project”.
Screenshot from executive order highlighting the removal of the sanctions waiver to the Chabahar port.
The Chabahar port is a key strategic initiative for India, providing it with not only a foothold in the region but also a crucial trade route to Afghanistan and Central Asia, bypassing Pakistan.
In May last year, India and Iran signed a ten-year agreement for the operation of the port by India Ports Global Ltd (IPGL). The state-run IPGL is set to invest around $120 million in equipping the port, while India has also extended a credit facility in Indian rupees amounting to $250 million for “mutually identified projects aimed at improving Chabahar-related infrastructure”.
In May 2016, India, Iran and Afghanistan had signed a trilateral agreement for the development of Chabahar. India’s IPGL had taken over the full operation of the Chabahar port in December 2018, but work had slowed down.
During Trump’s first term, the US had imposed stringent sanctions on Iran to curb its crude oil sales, but had granted a waiver for the Chabahar port.
However, due to the uncertainty, private companies were reluctant to deliver equipment for the Iranian port due to the fear of attracting adverse attention from Washington.
At the time of the signing of the agreement last year, Indian officials claimed that since 2018, the port has handled traffic of more than 90,000 twenty-foot equivalent units of container traffic and more than 8.4 million metric tonnes of bulk and general cargo.
There has been no response yet from the Indian government to the announcement of the intention to remove the waiver on sanctions on the Chabahar port, which would be inimical to its interest in the region.
Indian Prime Minister Narendra Modi is set to visit Washington next week at the invitation of President Trump.
At the ceremony to sign the memo, Trump called it “very tough”.
“With me, it’s very simple: Iran cannot have a nuclear weapon,” Trump said.
When asked how close Tehran is to developing a weapon, Trump replied, “They’re too close.”
The memorandum directs the US treasury secretary to impose “maximum economic pressure” on Iran, including sanctions and enforcement mechanisms against those violating existing sanctions.
It also instructs the treasury and state departments to launch a campaign aimed at “driving Iran’s oil exports to zero”.
