The US backed India after the Pulwama attack. Delhi, which relies on US support at the UNSC, has a tough choice given Iran accounts for about 13% of its oil imports

WASHINGTON: The waiver for India runs out on May 1, and from May 2, India cannot import oil from Iran, or its state-owned or private entities will face US sanctions.

With the White House announcing the end of the waiver to buy Iranian oil, Washington has conveyed to Delhi that it has stood by India on combating terrorism after the Pulwama attack and expects reciprocity on President Donald Trump’s commitment to disrupt Iran’s terror network, The Indian Express has learnt.

In its conversation with Delhi, the Trump administration has also assured that the exemption of the development of the Chabahar port project will continue, though its decision to halt the waiver on oil imports to India is guided by its objective of “changing the Iranian regime’s malign behaviour”.

Moving to squeeze Iran’s top export, the White House Monday said it will no longer grant sanctions exemption to Iran’s oil customers. The waiver for India runs out on May 1, and from May 2, India cannot import oil from Iran, or its state-owned or private entities will face US sanctions.

Hectic consultations are underway between India and US officials, with a top US State Department official, Alice Wells, visiting India currently to discuss the issue with Indian interlocutors. The US has told Indian officials that the policy is designed to put “maximum pressure” on Iran, and is not targeted against India.

The US has been leading the effort at the United Nations Security Council to list Jaish-e-Mohammad chief Masood Azhar a “Global Terrorist”, and is working with French and British interlocutors in the face of opposition from Beijing. US officials also did the heavy-lifting to get Beijing on board when the UNSC issued a condemnation statement after the February 14 Pulwama attack.

Foreign Secretary Vijay Gokhale had visited Washington DC on March 11, after the February 26 Balakot air strike and when the UNSC deadline for Azhar’s listing was due on March 13 amid the hectic diplomatic offensive.

The assessment in Washington is that the reduction of oil imports from Iran has tightened the screws against Tehran, and this is visible in the lack of salaries for Hezbollah fighters and lack of funds to move missiles among other similar activities.

Explained

A Tough Choice

The US backed India after the Pulwama attack. Delhi, which relies on US support at the UNSC, has a tough choice given Iran accounts for about 13% of its oil imports.

Since Iran lost the revenue from oil over the last year, the US believes that the Iranian regime would have used that money to support terror groups like Hamas and Hezbollah, and continue its missile development, in defiance of UNSC resolution 2231. Earlier this month, Iran’s Islamic Revolutionary Guard Corps was designated a foreign terrorist organisation.

The US policy towards Iran was announced in May last year, and all countries were given six months until November 2018 to bring down oil imports to zero. In November, Washington gave a six-month waiver to eight countries, including India.

American interlocutors have told Delhi that the non-renewal of the waiver will impact not just India, but close allies like Japan and South Korea and NATO ally – Turkey as well. They have also conveyed that the deadline for sanctions to kick-in starts May 2, and it is a “pre-ordained process” under US law.

Washington is also working with Delhi to keep the oil market well-supplied, with Saudi Arabia and the UAE prepared to export more oil to India. India Tuesday said it was adequately prepared to deal with the impact of the US decision to end waivers that allowed it to buy Iranian oil without facing sanctions.

The Ministry of External Affairs official spokesperson Raveesh Kumar said the government will continue to work with partner nations, including with the US, to find all possible ways to protect India’s energy and economic security interests.

“The government has noted the announcement by the US government to discontinue the Significant Reduction Exemption to all purchasers of crude oil from Iran,” he said. “We are adequately prepared to deal with the impact of this decision,” he said.