The U.S. has said it is revoking a sanctions waiver granted to India in 2018 for operations at Iran’s Chabahar Port, potentially endangering Delhi’s development of the key terminal.
Effective Sept. 29, the decision is a continuation of Washington’s “maximum pressure” campaign against Tehran, which ramped up after Israeli airstrikes on Iran earlier this year.
The 2018 waiver, issued under the Iran Freedom and Counter-Proliferation Act, had allowed India and other countries to continue work on the port without facing sanctions. For India, Chabahar carries strategic importance, bypassing Pakistan, and providing a link to Afghanistan and Central Asia.
In its Sept. 16 statement, the U.S. State Department said the decision was “consistent with President Trump’s maximum pressure policy to isolate the Iranian regime.” It warned that any persons operating the Chabahar Port or engaging in other activities described in the Act could expose themselves to sanctions after the revocation comes into effect.
It said the move aligns with Washington’s broader efforts to disrupt “illicit financial networks that sustain the Iranian regime and its military activities.”
Just a year ago, on May 13, 2024, New Delhi signed a 10-year deal to operate Chabahar in partnership with Iran’s Port and Maritime Organization. Under the deal, Indian Ports Global Limited committed about $120 million for the port, along with plans to raise another $250 million in credit for infrastructure development.
The decision comes as a major blow to India, which must now consider means to protect its investment and companies involved in the project. It follows on recent tensions between India and the U.S., arising from Washington imposing 50% in tariffs on Indian goods, though both sides maintain negotiations are ongoing to secure a mutually beneficial deal.
Pakistan and Iran
Earlier this week, Pakistan and Iran signed several protocols aimed at dismantling tariff and non-tariff barriers, expanding electricity exchanges, and strengthening communication channels to increase bilateral trade volume.
The protocols were signed at the conclusion of the Pakistan-Iran Joint Economic Commission in Tehran in the presence of Commerce Minister Jam Kamal Khan and Iran’s Roads and Urban Development Minister Farzaneh Sadeq.
According to the Commerce Ministry, the signing of the protocols would help achieve a $10 billion trade target between the neighboring countries.