US exempts Chabahar port-related activities from its sanctions

US exempts Chabahar port-related activities from its sanctions

Representatives of India, Afghanistan and Iran met a little more than two weeks ago in New Delhi, despite looming US sanctions, to discuss operationalization of the port, which is seen as key to connect India and Afghanistan to Iran and Central Asia, bypassing Pakistan.

A group of producers around the Organization of the Petroleum Exporting Countries (OPEC) as well as Russian Federation decided last June to relax output curbs in place since 2017, after pressure from US President Donald Trump to reduce oil prices and make up for supply losses from Iran.

The US government re-imposed the sanctions after withdrawing in May from the 2015 Iran nuclear agreement, which is more formally known as the Joint Comprehensive Plan of Action (JCPOA). With Pakistan denying India land transit through to reach Afghanistan, New Delhi developed an alternate route through Chabahar port in Iran, which it helped develop partly and also operates now. "These activities are vital for the ongoing support of Afghanistan's growth and humanitarian relief".

Following Washington's announcement of waivers, Japan's Trade Minister Hiroshige Seko said the country's oil importers were expected to prepare to resume imports from Iran.

The port in the Sistan-Balochistan province on the energy-rich nations southern coast is easily accessible from India's western coast and is increasingly seen as a counter to Pakistan's Gwadar Port, which is being developed with Chinese investment and is located at distance of around 80 kms from Chabahar.

"Past U.S. presidents changed their attitudes towards Iran in line with experience". It states that India has a major role in bringing peace and development in Afghanistan.

"Trump administration made the right move by exempting India for the development of the Chabahar port", Jeff Smith of the Heritage Foundation told PTI. We have to ensure that we advance our national security objectives without injuring our economic interests.

The US is already poised to satisfy most of the increase in global oil demand next year, the IEA forecasts.

"Combined with the importance, this administration places on developing good ties with India, there was a compelling geopolitical case to be made for a waiver", he said.

The US announced on Tuesday it has provided for an "exception" from certain sanctions - an exemption, in other words - to the Iranian port of Chabahar that India has developed and used for reconstruction efforts in Afghanistan.

Meanwhile, US ambassador to Afghanistan John Bass said the US has, after extensive consideration, provided an exception under the Iran Freedom and Counter-Proliferation Act.

India had lobbied the U.S. privately and publicly for an exemption for the port citing the role it plays in Afghanistan's reconstruction. "So this waiver is squarely aligned with the U.S. interests", he said.