Indian Finance Minister Nirmala Sitharaman told the US on Friday that New Delhi needs the strategic Iranian port of Chabahar to ensure trade with landlocked Afghanistan.
“We did explain the Indian position. Specifically, the need for us to maintain land-based access to Afghanistan, particularly, the need for us to have the Chabahar link. Also for strategic and other reasons it was important for us to continue with that,” the Indian finance minister said following a bilateral meeting with Mnuchin.
India has raised the issue of Iranian sanctions as it is hurting the development of Chabahar since foreign firms are refusing to participate in the project, fearing trade sanctions despite the US waiver to develop the port.
“We have explained the need for us to maintain our links to Chabahar for Afghanistan trade considering our commitments for Afghanistan, also, in the context of Pakistan continuously denying us access to land trade,” the Indian minister replied when asked whether India expected relief from the US side.
Nevertheless, Mnuchin hinted that there would be no special relaxation for India over the issue.
“We are working with our allies to make sure that there is significant supply of oil in market to offset the sanctions. We are sensitive to the fact that India has tremendous energy needs. We are working with India on liquefied natural gas,” Mnuchin said.
Earlier this week, the US and six Gulf countries agreed to jointly impose sanctions on 25 corporations, banks and individuals allegedly linked to Iran's support for militant networks including Hezbollah.
The US Special Representative for Iran Brian Hook threatened military action if Iran "attacks" American interests in the Middle East.
The Indian minister’s statement assumes significance in the wake of Iran’s envoy to India Ali Chegeni, who said in September that New Delhi’s decision to stop oil imports from Tehran due to a sanctions threat by Washington since May this year was hurting bilateral trade and the prospects of India’s future involvement in the development of Chabahar.
Chabahar is considered a gateway for New Delhi’s trade with Iran, Afghanistan and the countries of Central Asia. The port, situated on the Indian Ocean in Iran's Sistan and Baluchistan Province, is easily accessible from India’s west coast.
The Chabahar route would result in a 60 percent reduction in shipment costs and a 50 percent cut in shipment time from India to Central Asia.