Why Iran Matters (to India)

This article was published in Hindustan Times February 7, 2007

There is a plain, old-fashioned, geopolitical logic behind India’s contemporary relations with Iran — it is on the other side of Pakistan and Afghanistan. It is sometimes difficult to comprehend the extent to which our poor relations with Pakistan have robbed us of our Eurasian heritage. Blocked from any overland access to Iran, Afghanistan and beyond, India has been an island of sorts, with its trade and travel using ships and aircraft. But today’s great game is not about heritage or a shared past. It is about the politics of the region that will decide the kind of future that this region will have.

While most countries welcomed the US military intervention against the Taliban in Afghanistan, they have strongly opposed the invasion of Iraq. The more perceptive observers saw it for what it was — a dangerous case of hubris where Washington felt that it had all the answers for the many-layered complexities of the region. It turned out they did not. As a result, the situation in the region has deteriorated sharply. While Iraq appears to be in its death throes as a united nation, the resurgent Taliban are giving notice that they are back in the reckoning, having learnt nothing and forgotten nothing. A major reason for this is that Pakistan, the Taliban’s main backer, sees Afghanistan as strategic space in its eternal contest with India.

Here, Iran plays a positive and helpful role for us. Almost all the diesel, bitumen, cement, machinery and personnel working in the numerous projects in Afghanistan move through Zahedan, in eastern Iran. This is not out of Tehran’s goodness of heart, but because if they return to power, the fanatically Sunni Taliban will give short shrift to their co-religionists, the 20 per cent Shias of the country, as well as pose a threat to Iran. In the difficult years before 9/11, when the US backed the Taliban, or at least went along with Pakistan and Saudi Arabia’s backing of them, a motley alliance of India, Iran and Russia kept an anti-Taliban Northern Alliance going with money and material support. “That last time our interests converged,” says Hamid Ansari, the former diplomat who is currently Chairman of the Minorities Commission, “this may not be so the next time around”. In short, India cannot take Iranian support for granted and must put in some work to retain its freedom of action in an area that has a vital bearing for its security.

The turbulence of the Iraq conflict, including the emerging confrontation between the US and Iran, is not good news for anyone, especially not India whose five million strong workforce send back some $ 20 billion per year in remittances. We desperately need peace and stability in the region also because 70 per cent of our petro imports come from the littoral countries of the Persian Gulf. These countries have, without exception, been “India friendly and Indian friendly, but who knows what the outcome of another conflict [involving Iran] could be?” asks Ansari. As it is, Iran is afflicted by internal tension between reformists demanding democratic rights and the conservatives, who seek to keep the country in the tight confines of Islamic orthodoxy. Its unique system of managed democracy has worked so far, but it conceals major faultlines within.

The immediate problem that India confronts in Tehran arises out of the issue of the latter’s nuclear policy. This is not a problem of New Delhi’s making. But as a country with vital interests in the region, India cannot avoid taking a stand. Critics have charged that New Delhi’s votes at the IAEA meetings on the Iran nuclear issue were at America’s bidding. That is a matter of speculation, but would still be unexceptional.

To paraphrase Lord Palmerston, a nation has neither permanent friends nor enemies, “only permanent interests”. If India has significant interests in Iran, it has much more varying and extensive interests in the US. And at the point in time when India took that stand — in late 2005 and early 2006 — those interests had a special salience.

The challenge lies in finding the right balance in our relations with the two countries, both of whom are important for us and also happen to be in a state of near conflict with each other. India’s position, oft stated by Prime Minister Manmohan Singh, is that India does not think it “desirable” to have another nuclear power “in our neighbourhood”; Iran must honour all its commitments and obligations to the NPT; and diplomacy must be the chosen means of resolving the issue. We are now also bound by the UN Security Council Resolution 1737 which Tehran terms ‘illegal’ and which blocks the export of sensitive nuclear materiel and freezes the financial assets of persons or entities supporting Iran’s nuclear activities. Since the resolution is under Article 41 of Chapter VII of the UN Charter, and an automatic recourse to military measures is ruled out, we can take comfort in the fact that there is yet room for diplomacy.

If the nuclear pill stuck in the throat of West Asia is swallowed — or expelled — there is a vast and important strategic agenda for India and Iran to work on. Primary among these is the enormously portentous land bridge from Bandar Abbas to Helsinki.

This may have been a gleam in the eye for Russia and Iran for some time. In September 2000, in St Petersburg, India’s representative, BJP President Rajnath Singh, then Minister of Surface Transport, signed an inter-governmental agreement on the corridor with his counterparts from Iran, Russia and Oman. Since then, the idea received important validation through a 2001 report of the UN Economic and Social Commission for Asia and Pacific (Escap). However, little has happened since, because more urgent matters have emerged.

Actually, India has a more significant stake in a smaller, but strategically important, project to build a rail line from the eastern Iranian port of Chah Bahar to Zahedan. A consortium led by Ashok-Leyland, and two Indian Railway subsidiaries, RITES and IRCON, are ready to take up the project, which also involves building a container terminal at Chah Bahar. But progress is stymied. The Iranians want the Indians to build the project on a build-own-operate and transfer basis. But the organisations involved say that the short-term low business potential of the region requires some form of government subsidy.

Even projects much further down the road have major last-mile problems. The 2005 deal for the supply of 5 million tonnes of liquefied natural gas per year is stuck because the Iranians are now demanding new and higher prices. Reopening a closed deal, for whatever reason, is not a good augury for the ability of the two countries to press on with larger projects. The Iran-Pakistan-India pipeline remains caught up with more fundamental questions. Who will invest in the pipeline? What will be the structure of the company? How will its security be ensured and how reliable will be the supply guarantees? To factor all these issues into the cost, and yet get a reasonable price for the gas at the terminus point in India, is a problem yet to be solved.

In countries like India and Iran, the central governments have had a tradition of playing as strong a role in their commercial and industrial affairs, as in their security and foreign policies. So, ensuring success in all these areas requires continuing and consistent political contact at the highest levels. The press of other commitments often finds senior leaders confronting that eternal challenge — time is short, while the work keeps accumulating. Pranab Mukherjee’s visit is a small step to address a large agenda.