US grants India six-month exemption from American sanctions on Chabahar port: MEA

The US has granted India six months waiver from American sanctions on the Chabahar port project, the Ministry of External Affairs (MEA) said on Thursday.

MEA spokesperson Randhir Jaiswal also said that India's talks with the US for a trade deal are continuing. At a media briefing, he said India is studying the implications of the recent US sanctions on Russian oil companies.

What did MEA say?

“We are studying the implications of the recent US sanctions on Russian oil companies. Our decisions naturally take into account the evolving dynamics of the global market,” he said, as reported by PTI.

India is a major partner in the development of the Chabahar port, located in the Sistan-Balochistan province, Iran's southern coast. It is currently operating the Shahid Beheshti terminal at the port.

“Our position on the larger question of energy sourcing is well known. In this endeavour, we are guided by the imperative to secure affordable energy from diverse sources to meet the energy security needs of our 1.4 billion people,” Jaiswal added.

In September, the Trump administration decided to revoke the 2018 sanctions waiver with regard to the strategically located Chabahar port in Iran.

State Department spokesperson Tommy Pigott announced that the US has ended the sanctions waiver for Iran's Chabahar port, effective 29 September. He said the move aligns with Trump's “maximum pressure policy” aimed at isolating Iran.

Chabahar was seen as a key alternative trade route to Afghanistan that bypassed Pakistan, which traditionally dominated transit trade to the country.

Why Chabahar matters to India?

Chabahar holds major strategic importance for India due to its location on the open sea, beyond the Strait of Hormuz, one of the three key choke points in the Indian Ocean.

Its position shields it from potential conflicts in the Gulf or West Asia, while also placing it just 550 nautical miles from Gujarat's Mundra and Kandla ports and 780 nautical miles from Maharashtra’s JNPT.

The port is central to India's strategy to counter China's growing influence in Eurasia and the Indian Ocean. Since the 1990s, China has drawn the Central Asian Republics (CARs) into its economic and geopolitical sphere of influence.

To rebalance regional power, India and the CARs launched the India, Central Asia Dialogue in 2019, with many of these nations expressing strong interest in Indian connectivity initiatives like Chabahar to secure direct access to the Indian Ocean.

China's maritime reach has expanded significantly since 2000, with the construction of 38 ports worldwide and stakes in 78 more, along with 43 additional projects planned or under construction under the Belt and Road Initiative (BRI), according to a report by ORF.

Several of these, such as Pakistan's Gwadar Port, form part of the so-called “String of Pearls” network encircling the Indian Ocean.

(With inputs from agencies)