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Iranian Muddle

Given India’s own civilisational-cultural-economic stakes with Iran, the drift of Tehran towards Beijing could not have come at a worse time. With India‘s own geostrategic investments in the Chabahar port in Iran faltering, detrimental developments in Afghanistan, and the commercial implications of being unable to conduct Indo-Iranian trade due to the sanctions, the overall situation is grim. The possible linkages of the Chabahar imperatives with the Gwadar facility could be disastrous for Delhi. Besides, an energy-hungry economy like India always counted upon the Iranians as amongst the top three suppliers of oil

BHOPINDER SINGH | New Delhi |

The Joint Comprehensive Plan of Action (JCPOA) or simply the Iran Nuclear Deal was signed on 14 July 2015, after 20 months of hard negotiations. It eased unfair sanctions on Iran and verifiably prevented the country from manufacturing nuclear weapons.

Barring a section of Republican hardliners, some Sheikhdoms and the state of Israel, a majority of independent experts, multilateral agencies, and countries across the world, hailed the deal as the victory of mature diplomacy over possibilities of violent conflict.

Political expediency of warmongering was given a break and restorative possibilities flourished, and for once, bitterly divided countries like USA, Russia, China, and Iran, were on the same page. The International Atomic Energy Agency (IAEA) routinely confirmed that Iran was complying with its commitments under the multilateral deal ~ yet the utterly divisive and so-called ‘muscular-politics’ of the subsequent President, Donald Trump, tore up the thawing deal. Trump’s unwarranted and provocative action aimed at galvanising his ‘redneck’ cadre, achieved that limited objective, though the consequential reneging of Iran’s stand (justifiably so) and the return of hardliners in Tehran owes its genesis to the sort of extreme right-wing politics played by the likes of Trump.

IAEA Director General, Rafael Grossi, noted that the world had become a more dangerous place due to Trump’s misplaced priorities and policies, and hoped that his successor, President Joe Biden, would return to negotiations with Iran. President Biden’s 2020 election campaign had promised to ‘re-enter the agreement’, the reckless withdrawal from which President Barack Obama had slammed as a ‘serious mistake’.

Now, over one year into the Biden Presidency, the much-bandied restoration is still awaited, though the occupant of the White House reassures that, ‘it’s not time to give up’. Compounding matters is the advent of the ultra-conservative and anti-West stance of the Iranian President, Ebrahim Raisi, who rightfully complains, “We don’t trust the promises made by the US government” and that “sanctions are the US’s new way of war with the nations of the world”. This comes in the backdrop of the socio-economic misery felt by Iranians, following the crippling pandemic.

The misplaced domestic agenda of Trump has inadvertently regressed the overall narrative, brought back the hardliners, and dangerously pushed the isolated Iranians towards the baiting Chinese regime. On the rebound, Iran is now aggressively pursuing an ‘Look East’ policy of deepening ties with China and Russia, after having joined the Shanghai Cooperation Organisation and with the symbolically significant move of conducting their (Iran, China and Russia) third joint naval drills, under the aegis of ‘2022 Maritime Security Belt’.

Given India’s own civilisational-cultural-economic stakes with Iran, the drift of Tehran towards Beijing could not have come at a worse time. With India’s own geostrategic investments in the Chabahar port in Iran faltering, detrimental developments in Afghanistan, and the commercial implications of being unable to conduct Indo-Iranian trade due to the sanctions, the overall situation is grim.

The possible linkages of the Chabahar imperatives with the Gwadar facility (Pakistani port leased to China as part of China-Pakistan-Economic-Corridor), could be disastrous for Delhi. Besides, an energy-hungry economy like India always counted upon the Iranians as amongst the top three suppliers of oil. Today, the bullheaded partisan politics of the American right-wing has hit India, as indeed the global economy. Global Brent crude oil spot prices which averaged $42 a barrel in 2020, shot up to an average of $71 in 2020, and are already touching the $85 levels, in 2022.

For India, which imports roughly 1.5 billion barrels of crude oil or 86 per cent of its annual requirement, an estimated increase of $10 per barrel increases the bill by nearly $10 billion, triggering inflation (by an estimated 10 basis points) and consequential rate hikes by RBI, increasing cost of production per se, increasing fiscal deficit, and worsening the economic health of an already pandemic-hit economy.

The deliberate denial of Iranian oil in the global market, may have hit the Iranian economy, but it has not spared the world’s countries, including the US. Oddly, Iran sits on a stockpile of oil that could be easily brought to the market and thereby cool the spiraling surge of global crude oil prices, but it remains an untapped opportunity.

It is estimated that the reintroduction of Iranian oil in the overall calculus could lower global oil prices by approximately 10 per cent immediately and the consequential benefit of that on the global economies and geostrategic dynamics is almost incalculable. There are no winners in continuing intransigence, and if anything, a positive move could even shore up Biden’s sliding approval ratings.

Perhaps the well-entrenched Ayatollahs in Iran realise the ensuing conundrum and are now playing hardball in terms of renegotiating the fresh proposal, as recent history has given them the pretext to remain wary and difficult. Aggressive Iranian postures of teasingly posing with the Chinese, empowering the Houthi rebels in Yemen to strike the United Arab Emirates, strengthening Bashar al-Assad’s hand in Syria, stonewalling IAEA inspections and monitoring, to aggressively move towards nuclear ‘breakout’ i.e., nuclear weapons capability ~ is potentially recalibrating the so-far unsuccessful negotiations towards strengthening Iran’s bargaining power and terms for the deal, should it come through.

So precarious is the situation that the Israeli Defense Minister, Benny Gantz, flew to Washington to propose joint military exercises towards a potential strike on Iran’s nuclear facilities ~ reminiscent of ‘Operation Opera/Babylon’ in 1981, when Israeli Air Force jets conducted a preemptive airstrike on the still-underconstruction Osirak Iraqi nuclear reactor (which was ironically attacked by Iran earlier, in its partially successful ‘Operation Scorch Sword’).

The ensuing tragedy and threat emanating from the region is an example of how unhinged political leadership that strays from the path of reconciliation owing to electoral considerations, can dishonour a sovereign ‘word’ just because it was made by the previous political administration.

Biden does his own perception no favour by fumbling his way towards restoring the deal, as the Iranians have only entrenched themselves towards more advantageous positions. Meanwhile, the overarching global situation has only become more tense. The economic-geostrategic-human cost of Trump’s ill thought out bravado will continue to bleed the world, the US included.

(The writer is Lt Gen PVSM, AVSM (Retd) and former Lt Governor of Andaman & Nicobar Islands and Puducherry)