The Navigator from CGP

A Tryst with Destiny: Delving into the Indo-Iranian Strategic Alliance

PUBLISHED April 10, 2018


In 2016, when Indian Prime Minister Narendra Modi visited Iran, he stated, “Chabahar can be a very big symbol of cooperation between Iran and India; India and Iran are not new friends, as our dosti (friendship) is as old as history.” With those comments, Modi set forth a new era in the Indo-Iranian relationship. After the Iranian nuclear deal, which removed international sanctions against Iran in exchange for ceasing its nuclear program and allowing international inspectors, India aggressively embraced Iran in strategic military, technological, commercial, political, and cultural partnerships.  

India and Iran’s alliance did not emerge overnight. Rather, the two countries worked diligently to advance bilateral cooperation. For instance, in 2001, the India-Iran Strategic Dialogue conference focused on regional and international security, along with the defense policies of India and Iran, and forged a common agenda on international disarmament policies concerning Iran. Probably the most significant bilateral development was when former Iranian President Mohammad Khatami visited New Delhi in 2003 to sign the New Delhi Declaration, adding seven Memoranda of Understanding on increasing trade, exchanging information, technology and science, and cooperating on counterterrorism.  

Iranian President Hassan Rouhani’s visit to India in February 2018 solidified the Indo-Iranian alliance by allowing New Delhi operational control of the Iranian east coast port of Chabahar for 18 months. The $200 billion project, only 56 miles from the Chinese-sponsored Gwadar port in Pakistan, creates a transit route to Afghanistan that bypasses Pakistan.

The Indo- Iranian Alliance

India is the fourth largest consumer and the largest exporter of coal, but it desperately needs alternative energy sources to meet rising domestic demands. With the Chabahar Agreement, which includes railroads to Iran’s Zahedan region, India will have extraordinary access to potential energy resources stretching from southeastern Iran to Central Asia. Building upon Chabahar is a proposed International North South Transport Corridor sponsored by New Delhi, Moscow and Tehran, which would transport goods in both directions between India and Europe, through Iran, Azerbaijan, and Russia. This will expand the market for Indian human capital and consumer products. India can provide Iran and Central Asia with low-cost intellectual and material assistance in the development of information technology networks, roads, ports, and railroad projects.

India’s largest minority consists of approximately 165 million Sunni Muslims. Both India and Iran, for different reasons, fear the spread of jihadist movements, especially Daesh branches in South Asia, Central Asia, and the broader region. Rouhani’s visit in February demonstrates that a Shiite theocratic Islamic republic is capable of political and economic collaboration with a fundamentalist Hindu ruling party (the Bharatiya Janata Party). Moreover, as India continues to confront growing polarization between various Muslim and Hindu communities, Modi’s alliance with Rouhani provides an opportunity to diminish fears at home and abroad that India is becoming an Islamophobic polity.

After years of the U.S.-led sanctions on Iran, Tehran and New Delhi’s bilateral relationship will have massive effects on Iran’s struggling economy. It will put Iran in a position to become a more viable global trading partner and political ally.

Factoring in China and Pakistan

Since India’s fiercest economic competitor is China, what is meant to be a strategic partnership between Iran and India could serve to limit China’s ambitions in Southwest and Central Asia. China is investing in the world’s largest infrastructure program — the ambitious, $900 billion New Silk Road, which connects China, Central Asia, Europe, and the Middle East. The New Silk Road will improve Chinese trade by using both land and sea routes to connect 68 countries. As China’s ally, Pakistan benefits from the New Silk Road project, whose China-Pakistan Economic Corridor entails $46-$65 billion investments in new roads, bridges, geothermal energy, and the establishment of the largest port on the Arabian Sea in Gwadar.

In addition, the Chinese are investing in several energy projects, including oil and gas pipelines in Russia, Kazakhstan and Myanmar. There are roads and infrastructure projects sponsored by China underway in Ethiopia, Kenya, Laos, and Thailand.

Though the Indo-Iranian alliance serves to counter China, Tehran and New Delhi’s cooperation will also limit Pakistan’s leverage in Afghanistan. Afghan President Ashraf Ghani said the Chabahar Agreement will “end Pakistan’s monopoly in Afghanistan.” India and Iran have been cooperating in Afghanistan for more than 30 years. The countries’ support for the Northern Alliance in the 1990s has become close coordination with Ghani on infrastructure development, financial opportunities, counterterrorism training, and arms trading.

U.S. Interests in the India-Iran Alliance

The Trump administration’s desire to limit China’s global expansion is linked directly to supporting fair trade, transparency, good governance and open access to markets for India. In its Indo-Pacific Strategy, Washington has invested heavily in circumventing China’s New Silk Road, as Secretary of Defense Jim Mattis outlined in the U.S. National Defense Strategy.

While the United States and India have a common interest in countering China, Washington and New Delhi are not exactly on the same page regarding Iran. Many officials within the Trump administration disagree with the Indo-Iranian alliance because they believe India is normalizing Iran and thus ignoring the Iranian threat to U.S. interests in the Middle East. But leading strategists assert that integrating Iran into the international system, not isolating it, serves U.S. interests by binding Iran to a rules-based system, which if violated would entail severe economic costs to Tehran. Washington’s chief question is, if the United States abandons the Iranian nuclear deal, would India have enough influence with Iran to prevent Tehran from pursuing a nuclear program?

Accepting the Indo-Iranian alliance involves a complex matrix of relationships, but hawks and doves alike will need to accept Iran’s gradual integration into international institutions. From a U.S. security perspective, the Indo-Iranian alliance aligns with U.S. strategy in Afghanistan and Pakistan while providing competition for China.

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