Diplomatic balancing act

As India heads for general elections in the spring, G. Parthasarathy assesses how Delhi is dealing with tensions in its western neighbourhood

Domestic policies and developments are taking centre-stage in New Delhi as India gears up for Parliamentary elections, due to be held in April-May this year. Since the conduct of foreign policy has generally enjoyed a broad national consensus, the practice of receiving a large number of foreign dignitaries in the early months of the year has continued, even in 2019.

The year commenced with a visit by South Africa’s President Cyril Ramaphosa as the country’s Chief Guest on India’s Republic Day,as well as visits by the Norwegian Prime Minister and the Foreign Ministers of Japan and Iran.With Japan and India now increasingly offering support to each other on issues of national security and economic cooperation across the Indo-Pacific, Japan is now emerging as New Delhi’s closest strategic partner in Asia.

Another major development in strategic terms has been the consolidation of India’s relations with Iran. This is despite American sanctions, which are inevitably impacting on India’s efforts to build a relationship of trust and cooperation with all its Islamic neighbours, including Iran, to its west, while supporting the Palestinian cause and simultaneously maintaining strong ties with Israel. New Delhi has been careful not to get drawn into sectarian and civilisational rivalries between Islamic countries, and has avoided taking sides in the Syrian conflict. India has also kept its distance from the rivalries between Saudi Arabia and the UAE on the one hand, and Qatar and Turkey on the other.

Thanks largely to efforts by former US Defence Secretary General Mattis, the Trump Administration now acknowledges the strategic importance of India’s involvement in Afghanistan. The US has backed New Delhi’s financial and technical assistance in providing Afghanistan access to the sea through the Iranian Port of Chahbahar, thereby bypassing Pakistan. Construction of the Chahbahar Port has now been completed and its management has been taken over by an Indian company. This has been accompanied by Indian assistance to build a rail line from Chahbahar to Zahedan on the Iran-Afghanistan border- establishing connectivity between India, Afghanistan and Central Asia.

US sanctions are impacting on India’s efforts to build a relationship of trust with all its Islamic neighbours

Along with China, South Korea, Japan, Italy, Greece, Taiwan and Turkey, India has received a 180-day waiver from Americansanctions for the import of oil from Iran. China can thereafter continue its imports of Iranian oil by bilateral banking arrangements, as it has done in the past. Japan can do likewise, even beyond the 180 days mandated by the US, given the fact that its trade with Iran is largely balanced. India has, however, experienced difficulties in the past, in working out viablebilateral payments arrangements for imports of Iranian oil,primarily because Iran showed little inclination to increase imports from India on a similar scale.

The visit of Iranian Foreign Minister Mohammad Javad Zarif to India in January was marked by a major banking agreement, with Iran setting up a Branch of its ‘Bank of Pasaragad’in Mumbai to collaborate on all bilateral payments with India’s ‘UCO Bank’, thereby clearing the way for long-term expansion of bilateral trade. Unilateral American sanctions on arms purchases from Russia and on oil and fertiliser imports from Iran are raising concerns in New Delhi, as India is the second largest importer of oil from Iran, from where it also purchases one third of its requirement of fertilisers at very competitive prices.

While India is seeking to obtain sanctions waivers from the US on Russian arms imports, as it has done in the case of the purchase of S400 Missile systems, it has also worked out bilateral banking arrangements with Russia, to deal with American sanctions when needed.There is, however, little doubt about Indian discomfiture with unilateral American sanctions, which make use of its control of global dollar payments. New Delhi is looking carefully at measures the EU is developing to circumvent such sanctions on energy and other imports from Russia and Iran. While India has many common interests with the US, it also cherishes its strategic autonomy and would be loath to yield to unilateral American sanctions on crucial areas like its energy security and arms acquisitions.

Iranian cooperation on developments in Afghanistan has also played an important role in shaping India’s policies towards Kabul after the days of Taliban rule. The Wahhabi-oriented policies of the Taliban and the group’s close links with Saudi Arabia were viewed with concern in Iran, especially given Taliban hostility to Shias living close to the Afghanistan-Iran border.During the Bonn Summit in 2001,India persuaded Iranto welcome the Bonn process and join global efforts to stabilise the Karzai government. But subsequent developments appear to have persuaded Tehran that, given the likelihood of an American troop withdrawal, its interests would be better served by keeping lines of communication open with the Taliban. Foreign Minister Zarif reiterated this while in Delhi.

In light of these circumstances, India will continue its delicate diplomatic balancing act beyond its western borders. Having played a key role in evacuating foreign nationals from Yemen when tensions started to escalate following direct Saudi-UAE military involvement, India has nevertheless steered clear of any involvement in the Yemeni conflict, though most Indians are horrified at the plight of the hapless Yemenis.

Over the past four years Mr Modi has visited many countries in India’s western neighbourhood, ranging from Jordan and Israel to Mauritius, Tanzania, Mozambique and South Africa. This has been complemented by his visits to Saudi Arabia and the UAE. Ties with Iran been firmed up, with a series of trilateral meetings between India, Iran and Afghanistan to develop the Chabahar Port and develop a viable transportation corridor to Central Asia. New Delhi realises that it needs partners like the US and Japan to guarantee the security of sea-lanes, across the Indian Ocean, through which an estimated 54 per cent of seaborne trade in petroleum products is routed. This trilateral linkage has included regular naval exercises between the three countries and the establishment of direct links between India’s Western Fleet and the Bahrain-based US Fifth Fleet.


G. Parthasarathy is a career Foreign Service Officer. He served as Ambassador of India to Myanmar, High Commissioner of India to Australia, Pakistan and Cyprus, and Spokesman of the Prime Minister’s Office. He is currently Visiting Professor at the Centre for Policy Research in New Delhi 

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