Economy

India gets United States waiver for Iran's Chabahar Port

India gets United States waiver for Iran's Chabahar Port

The U.S. sanctions had threatened India's ability to obtain financing for the development of Chabahar, which could potentially end Afghanistan's dependence on Pakistan's port of Karachi.

Other signatories to the JCPOA, including Russia, France, the UK, China and Germany, are struggling to preserve the deal and find a way to bypass USA sanctions, which also jeopardize foreign companies doing business with the Islamic Republic.

To a question on the fate of Chabahar Port after the United States reimposed all its sanctions on Iran, the spokesperson said, "This exception relates to reconstruction assistance and economic development for Afghanistan".

The announcement made by Secretary of State Mike Pompeo and Treasury Secretary Steve Mnuchin focussed primarily on the economic pressure built to bring Iranian oil imports to zero and "granted" exemptions to eight countries.

Iran has plans to link the port by railway to Zahedan on the Pakistani border up to Mashhad in the northeast. "These activities are vital for the ongoing support of Afghanistan's growth and humanitarian relief".

US waivers for Iranian oil purchases are likely to be more extensive than the market expects, with the combined range seen at 1.2 million to 1.7 million barrels a day, FGE Chairman Fereidun Fesharaki said in a note.

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India has invested $500 million (approximately Rs 3,600 crore at current exchange rate) in the Chabahar project, which will connect the country with Afghanistan and Central Asia, bypassing Pakistan.

The spokesperson cited the strategy to say it "underscores our ongoing support of Afghanistan's economic growth and development as well as our close partnership with India". Reacting to the Trump administration's decision, U.S. experts said it was a "right move".

India has poured $2 billion into Afghanistan since the 2001 US-led overthrow of the Taliban regime, which was also opposed by Iran.

Smith said, Delhi credibly argued that if it were to abandon development efforts at Chabahar the void would most likely be filled by others, including China.

Asserting that the US' "desperation" was highlighted in their move to include closed companies in the sanctions, Zarif said that the anti-Iran move was mostly criticised and opposed by the global community and that only a handful of nations like Israel and others supported the move. It understands India's national security interests.

Rick Rossow of the Center for Strategic and International Studies said: "Chabahar's role to transport key logistics to Afghanistan will continue to grow over time". Further drop in Iranian production is expected but the extent will depend on negotiations between the US and countries potentially seeking waivers, Fatih Birol, IEA Executive Director, said in an interview.