On Iran, India is of two minds (JERUSALEM POST) By JOSEPH MAYTON / THE MEDIA LINE 04/18/12)
JERUSALEM POST Articles-Index-Top
MUMBAI -- Anyone trying to get a handle on the dilemma-ridden
relations between India and Iran need look no further than the
tankers plying their away across the Arabian Sea that separates the
In the first quarter of the year, as the Western-led sanctions
campaign against Iran tightened, India surpassed China to become the
biggest importer of oil from the Islamic republic. Direct imports
averaged 433,000 barrels per day, compared with 256,000 to China,
according to data compiled by Geneva-based firm Petrologistics and
reported by Reuters last week.
But on a monthly basis, India’s crude purchases from Iran fell
steadily from a high of 531,000 barrels daily in January, suggesting
that purchases of Iranian crude are trending lower. Analysts say
India is not so much defying the boycott or expressing support for
the embattled regime in Tehran as it is exploiting Iran’s desperation
in order to negotiate favorable terms.
The data point up India’s conflict over Iran. On the one hand India’s
growing economy needs a steady diet of Iran petroleum. It resents
pressure from the West to join the sanctions regime. On the other,
New Delhi isn’t anxious to see another Muslim nuclear power emerge
close to its arch-rival Pakistan. India has developed close relations
with Israel in recent years and its ties with the Gulf are cemented
by its need for Arab oil as much as Iranian oil and by a sizable
India Diaspora in the region.
“While we are certainly closer to Israel and have no desire to see
Iran develop and have a nuclear weapon so close to our borders, we
are faced with the realities of our population,” Rajneesh Gudnartne,
a Foreign Ministry official in New Delhi, told The Media Line. “If
there are not alternatives [to boycotting Iranian oil] coming
forward, we will do what we believe is right for India and Indians.”
Like China, India is a new and an increasingly important factor in
the Middle East, which was once a playing field for the US, Europe
and the Soviet Union. While the two countries still keep a relatively
low diplomatic profile, their growing economic clout has turned them
into major customers for the region’s oil, therefore a critical part
of the campaign to stop Iran’s nuclear ambitions via an economic
“What we are witnessing right now is a turn toward the West, but not
the West as in Europe or America, but the West of the Middle East.
This is changing the dynamics of the region and India’s global
position,” Mehdi Hassanein, an assistant professor in political
science at University of Mumbai, told The Media Line.
Those conflicting pressures are felt as much by ordinary Indians as
by the government. As more and more Indians buy cars, they have a
personal stake in ensuring the country’s energy needs are supplied.
But India’s Hindu majority is also concerned about their Muslim
neighbors over the border and about the 180-million-strong Muslim
minority inside the country. Patriotic resentment over the US trying
to impose its sanctions policy complicates the situation further.
“We’re looking forward to this renewed push toward the Middle East
because the Western countries don’t deal with India in a respectful
manner,” said Yeerash Meeri, an owner of a transport company where
the price and availability of oil and gasoline are a major concern.
But he has worries, too. “I don’t want India to be held hostage by a
conservative Muslim country and their relationship with Pakistan,” he
told The Media Line.
Openly opposed to Western-led sanctions to pressure Tehran, India was
denied a US waiver from the measures. That has angered many in India,
who contend that its economy can’t quickly and easily end its
reliance on key source of oil. Iran is India’s second-biggest
supplier, providing it with about 12% of its oil needs.
New Delhi is committed to the narrower scope of United Nations
sanctions, but in an effort to skirt them, it created a mechanism
with the Iranians that lets refiners pay for imported oil in rupees
instead of dollars. The mechanism, which is supposed to cover about
45% of Iranian crude purchases, has been plagued by technical
According to a recent US Congressional Research Service report, the
Iranian concessions have made it irresistible for India to continue
to buy Iranian oil in defiance of Washington.
To encourage the trade, India’s Finance Ministry last week began to
offer tax incentives for the rupee deals. The two countries plan to
increase bilateral trade by more than 60% to $25 billion by 2015.
Nevertheless, New Delhi has reportedly quietly begun pushing refiners
for substantial cuts in imports from Iran.
But Hassanein said that behind the scenes New Delhi and Washington
are more understanding of each other’s positions on Iran than it
“Iran is not really that extreme and has cultivated a relationship
with India, albeit one based not on mutual respect, but on Iran’s
need to offload its oil. India is the one benefiting from the
arrangement,” Hassanein said. “We can see the outward animosity with
Washington, but the officials I know and speak to are saying behind
closed doors, relations with the US are amiable.”
A US diplomat in New Delhi, speaking on condition of anonymity, told
The Media Line that the situation is far from worrying, “considering
India’s continued strong relationship with Israel over recent terror
matters.” Israel has been able to create what he said are “positive”
atmosphere for India siding with the US and Israel in any matter
concerning security in the Middle East.”
Gudnartne of India’s Foreign Ministry expresses views on Iran’s
nuclear efforts that seem to mirror those of Washington and
Jerusalem. India’s relationship, he said, “largely depends on
Tehran’s acceptance of international standards and their willingness
to be transparent over their nuclear program.” India, like Israel,
does not want another Islamic country with a nuclear bomb, he
But Hassanein of Mumbai University says both countries should listen
to Iranian officials and accept their stance on nuclear power. “The
world needs Iranian oil and the fact is clear, Tehran doesn’t want,
nor do they need, a nuclear weapon. It is fear mongering mainly on
all sides that has put the Gulf region and India on edge,” he said.
(© 1995-2011, The Jerusalem Post 04/18/12)
Return to Top
MATERIAL REPRODUCED FOR EDUCATIONAL PURPOSES ONLY