A weak economy, an increasingly hostile neighbourhood, a series of foreign policy setbacks and an increasingly belligerent China. To this long list of woes, another disconcerting development has now been added: an imminent economic and security partnership between China and Iran. The far-reaching arrangement, involving $400 billion Chinese investments in Iran over 25 years, is a clear indication that Tehran is getting deeper into the Chinese embrace. This also fits into a pattern where Beijing is expanding its tentacles in the region through a blend of economic inducements, coercion and territorial aggression. Its growing influence in Pakistan, Nepal and Sri Lanka must be seen against this backdrop. The deepening economic bond between China and Iran must ring alarm bells in India’s diplomatic circles because of the high stakes involved in the Chabahar port project that it has been developing. It has now slipped out of New Delhi’s hands as Beijing has committed massive funds to develop Iran’s petrochemical and transportation sectors. Similarly, the emerging China-backed Pakistan-Iran-Taliban alignment is also a matter of serious concern for India. The growing Chinese footsteps in Iran will have a long-lasting impact on India’s relationship with Iran, Afghanistan and Central Asian nations. India finds itself caught in the crossfire with the US and China being engaged in a bitter geopolitical rivalry over Iran. After the Trump administration walked out of the nuclear deal with Iran in 2018, China has moved in to negotiate broader and deeper ties with Iran. Now, both China and Iran see the Western Pacific and the Persian Gulf as regions of contention with the US.
The Sino-Iran partnership in military and security-related areas, involving joint training and exercises and weapon development, also raises concerns in India. The sweeping nature of the agreement has caused some prominent Iranian nationalists to raise concerns about selling out to Beijing. India badly needs support from the US in the ongoing border stand-off with China. While India got a waiver from US sanctions for development of the Iranian port — on the grounds that it will help access Afghanistan bypassing Pakistan — it is still not clear whether railway and other projects are exempt from sanctions. There is a question mark over India’s participation in the expansion of Iranian railway network. Despite long-standing civilisational bond, the Indo-Iran bilateral ties have been sliding since the US made India’s Iran policy a condition for finalising the Indo-US nuclear deal announced in 2005, which ended India’s international nuclear isolation. India voted against Iran in the crucial International Atomic Energy Agency vote in the same year that led to coercive sanctions against Tehran. Again, last year, New Delhi buckled under American pressure on the issue of oil imports from Iran.
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