Iran is back in the news and for all the wrong reasons. It has been the unnecessary third wheel in Indo-US relations and vice versa. Like other countries in the Gulf region, Iran is more than an energy supplier. One can flag a host of political and strategic issues to underscore Iran’s importance and, if cultivated properly, Tehran could be a part of India's growth story. The prognosis for this, however, is not promising.

India’s strategic relations with the US are intractably linked to the Iran genie; the process of civil nuclear cooperation began around the same time that Iran’s clandestine nuclear programme came to public knowledge. Using a host of strategic inducements and threat of sanctions, President George W Bush and his successors have managed to curtail India’s aspirations for a sustained energy partnership with Iran. If India’s export of energy products to Iran ceased, the much-talked about Iran-Pakistan-India Pipeline was given a quiet burial. At the same time, American pressure tactics forced both countries to be innovative in terms of devising a rupee-payment mechanism to partly settle India’s oil import dues to Iran. Given, however, the trade asymmetry between the two countries, this was not a long-term solution and now the Trump Administration is pressuring India to completely cease oil imports from Iran.

The prolonged American sanctions were a fig leaf of defence for India and its strategic community to gloss over other issues. They could pretend that but for the US Indo-Iranian relations would have been robust and a model for others. While it is true that the US has been a spoiler, there are far more serious issues and irritants that cannot be ignored.

Between Morocco in the West and Indonesia in the East, Iran is the only other country which can truly be described as a ‘regional power.’ Besides all essential preconditions, the Islamic Republic has the political will to dominate. It is also the only country in the Middle East which has a say far beyond its borders. Either directly or through its proxies, Tehran has been influencing events in a host of countries, including Iraq, Syria, Lebanon, Palestine, Bahrain and Yemen. If Iranian militia took part in the successful Iraqi campaign against the Islamic State, their presence is vital for the continued survival of President Bashar al-Assad in Syria. Tehran’s cooperation or at least passive support is a precondition for the resolution of many of these problems. In other words, Iran has a finger in many of the hotspots in the Middle East.

Iran’s role is not always good news for the hosts as it has contributed to political instability, for instance, in Lebanon and Palestine. While Iran alone was not responsible for their internal problems, its support for the Hezbollah and Hamas has made internal reconciliation much more difficult and even unbridgeable. By carrying forward its revolutionary ideas of justice and resistance beyond its borders, Iran has annoyed, angered and intimidated many of its Arab neighbours and it is increasingly seen as a hegemonic power rather than a friendly neighbour.

For India, Iran is also a cantankerous partner. It seeks to renegotiate formal agreements, breaks off friendly understandings, raises the ante, and often irritates. Iran has never come to terms with India's vote in the IAEA and UN Security Council over the nuclear controversy. The Indian move was seen and often explained within the context of American ‘diktats,' but there was a subtext; even Russia and China—its traditional friends—were not prepared to accept the Iranian narrative and India’s anti-Iran vote was in sync with the prevailing international consensus. Without seeing the Indian vote within the context of Tehran’s own isolation, Iranian elites have been flagging it to irritate New Delhi. Indeed, Iran’s recent suggestion regarding Chinese involvement in the development of the Chabahar port is not music to South Block.

It is not as if Iran has exercised a great deal of restraint on issues that are dear to India. Powerful segments in Iran, including its Supreme Leader, have been making unfavourable statements on Kashmir and drawing parallels with the occupied Palestinian territories. Iran’s cooperation in counter-terrorism is also less exemplary. According to the Indian government, Kulbhushan Jadhav, who is facing a death sentence in Pakistan, was abducted from Iranian soil.

Moreover, senior Iranian leaders have been making inflammatory statements about countries with which India has close and friendly relations. While the anti-Iranian rhetoric and polices of President Donald Trump get attention, Iran is also complicating India’s relations with countries such as Israel, Saudi Arabia and the UAE.

If India were to ‘reciprocate' Iranian gestures, it could easily flag the conditions of the Baha'is in Iran, an issue which has come under repeated criticism of the UN General Assembly and other international bodies.

Realising the ‘strategic cooperation' flagged in the Delhi Declaration issued during the visit of President Mohammed Khatami in January 2003 has not been easier. Iran has not been an easy partner and its policies and statements have been at cross purposes with those of India. But the Indian strategic community has also contributed to this state of affairs. By exclusively focusing on the US dimension, the strategic community has glossed over the flip side of Indo-Iranian relations. While it is necessary to identify and shore up the convergence of interest, it is equally important to recognize differences and pitfalls. For example, Tehran’s missile programme has often been viewed and analysed within the exclusive context of Iran-Israel rivalry.

Unfortunately, the world is yet to see a missile that flies only in one direction. The issue is not the intentions of the Iranian leadership but its strategic capabilities. What is the implication of the Iranian missile programme for India and its Gulf Arab friends? Can Iran use its strategic assets to intimidate its smaller and less powerful Arab neighbours? These are uncomfortable puzzles.

Above all, for Iran, its opposition to extra-regional involvement is not a matter of principle but a strategic choice. Despite its cooperation with Russia over Syria, Tehran is equally opposed to any role for Moscow in the Persian Gulf, which it considers as its exclusive sphere of influence. Hence, Iran would not welcome any Indian military-security engagement, let alone cooperation, with Gulf Arab countries.

Geostrategic reality will ensure Iran’s continued importance. But the renewal of American hostility provides India an opportunity to evaluate the strengths and weaknesses of Indo-Iranian relations. Yes, Iran is more than an energy supplier but it also has strategic liabilities.

Note: The article was originally published as IDSA Comment on 5 July 2018 and is published with the permission of the author. Web link

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As part of its editorial policy, the MEI@ND standardizes spelling and date formats, to make the text uniformly accessible and stylistically consistent. The views expressed here are those of the author and do not necessarily reflect the views/positions of the MEI@ND. Editor, MEI@ND: P R Kumaraswamy