The United States has announced that it will end the sanctions waiver for Iran’s Chabahar port from September 29, 2025. This waiver had allowed India to continue development work at the port despite ongoing US restrictions on Iran since 2018. The US State Department said this decision is part of its "maximum pressure policy" under the Iran Freedom and Counter-Proliferation Act (IFCA). According to the statement, anyone operating Chabahar port or involved in related activities could now face sanctions under IFCA.
From my perspective, this move is a major diplomatic and strategic challenge for India, as Chabahar is critical for India’s trade and connectivity with Central Asia and Afghanistan. India had first proposed developing the port in 2003 to bypass Pakistan and secure trade routes. Later, in 2013, India committed USD 100 million towards the port’s development, and by 2024, it signed a 10-year contract to operate the Shahid Beheshti terminal. Chabahar has been used by India to send wheat aid to Afghanistan and export pesticides to Iran, even under earlier sanctions. The US decision now threatens these operations and could complicate India’s ongoing investments.
The US justified its action by pointing to Iran’s destabilising activities, including funding attacks, supporting terrorism, and other regional provocations. The American government also targeted an international financial network involving Hong Kong and UAE-based entities, accusing them of helping Iran sell oil to fund its Revolutionary Guard Corps and Ministry of Defence. From a global security standpoint, this shows the US continues to use sanctions aggressively to curb Iranian influence.
Chabahar port is located in Iran’s Sistan-Balochistan province, along the Gulf of Oman. For India, it is strategically important as it is the closest Iranian port to India, reducing dependence on routes through Pakistan. It also forms a key part of the International North-South Transport Corridor (INSTC), a multi-modal 7,200-km-long trade route linking India with Iran, Central Asia, Russia, and Europe. The corridor is crucial for India’s trade ambitions in the region and for strengthening connectivity with landlocked countries like Afghanistan.
In my opinion, losing the waiver may create short-term hurdles, but it does not reduce the long-term importance of Chabahar. India has invested heavily in port infrastructure, including USD 100 million and additional funds from the Ministry of External Affairs. Development plans have included modernising port facilities, operating terminals, and boosting trade volumes. Ending the US waiver may require India to reconsider its operational strategy, adopt alternative financing methods, or strengthen diplomatic engagement with both the US and Iran to maintain its interests.
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The Chabahar port project is India’s first overseas port operation. It is more than a trade hub—it represents India’s effort to expand strategic influence in West Asia and Central Asia. The port allows India to bypass Pakistan entirely, offering a direct route to Afghanistan and other Central Asian countries. It is also a counterbalance to China’s growing influence in the region, particularly through its investment in Pakistan’s Gwadar port under the China-Pakistan Economic Corridor (CPEC). From an opinion standpoint, securing Chabahar is a long-term strategic investment even if the US sanctions add immediate challenges.
Despite the waiver being revoked, India may have options. Diplomatic negotiations could ease US concerns, or India could explore ways to operate the port through alternate channels that comply with international regulations. Strengthening ties with Iran and regional partners could also help India protect its investments. In addition, India can continue using Chabahar for humanitarian supplies like wheat or medical aid, emphasising the port’s non-commercial importance.
In conclusion, while the US decision to revoke the Chabahar port waiver poses immediate operational and financial challenges, it does not diminish the port’s strategic value for India. The situation underscores the delicate balance India must maintain between global diplomacy and regional strategy. Going forward, India will need careful planning, strong diplomatic engagement, and adaptive strategies to ensure that Chabahar remains a key node in its connectivity and trade plans.
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