The ongoing economic sanctions by the US and the EU on Iran may not succeed without the support of Asian powers- China and India. Developments during the last two months indicate that both India and China are reluctant to follow the US sanctions. On the other side, ever since the beginning of US sanctions, Iran is trying to retain its trade engagement with both countries.
Iran’s economic weight is significant in Asia as a major supplier of crude oil. For China and India, energy security is necessary to support their present high growth phase. India meets nearly two thirds of its crude through imports. Iran is the second largest crude supplier for the country. This means that the economic cost the country will be bearing by supporting the US sanctions will be quite unbearable. India’s Commerce Secretary, Rahul Kullar responds to the sanctions “If the EU and the US both want to stop exports to that country, please tell me why I should follow suit? Why shouldn’t I take up that business opportunity?
Trade with Iran is a matter of survival for India because of its oil import dependence. But at the same time, the country is adopting a rather proactive stance on the issue by exploiting the opportunities opened with the US sanctions. After the launch of the sanctions, India became the largest importer of Iranian crude during January 2012, pushing China to the second position.
Besides these, India is now decided to send an official trade and economic delegation to Iran by February end to explore business opportunities and also other areas of cooperation.
Amidst the US sanctions, these developments indicate that India is trying to enhance its trade relationship with Iran because of the economic opportunity out of the sanctions. Rahul Kullar was always consistent on promoting trade ties with Iran and insisted that it is out of India’s interest.
In the coming weeks, competition may take place between India and China to utilize the post sanction opportunities in trade with Iran.
The ongoing economic sanctions by the US and the EU on Iran may not succeed without the support of Asian powers- China and India. Developments during the last two months indicate that both India and China are reluctant to follow the US sanctions. On the other side, ever since the beginning of US sanctions, Iran is trying to retain its trade engagement with both countries.
Iran’s economic weight is significant in Asia as a major supplier of crude oil. For China and India, energy security is necessary to support their present high growth phase. India meets nearly two thirds of its crude through imports. Iran is the second largest crude supplier for the country. This means that the economic cost the country will be bearing by supporting the US sanctions will be quite unbearable. India’s Commerce Secretary, Rahul Kullar responds to the sanctions “If the EU and the US both want to stop exports to that country, please tell me why I should follow suit? Why shouldn’t I take up that business opportunity?
Trade with Iran is a matter of survival for India because of its oil import dependence. But at the same time, the country is adopting a rather proactive stance on the issue by exploiting the opportunities opened with the US sanctions. After the launch of the sanctions, India became the largest importer of Iranian crude during January 2012, pushing China to the second position.
Besides these, India is now decided to send an official trade and economic delegation to Iran by February end to explore business opportunities and also other areas of cooperation.
Amidst the US sanctions, these developments indicate that India is trying to enhance its trade relationship with Iran because of the economic opportunity out of the sanctions. Rahul Kullar was always consistent on promoting trade ties with Iran and insisted that it is out of India’s interest.
In the coming weeks, competition may take place between India and China to utilize the post sanction opportunities in trade with Iran.
