Wednesday, 21 November, 2018

USA exempts India-backed port in Iran from sanctions

Iranian Foreign Minister Mohammad Javad Zarif speaks at the Iranian Parliament in Tehran Iran Iranian Foreign Minister Mohammad Javad Zarif speaks at the Iranian Parliament in Tehran Iran
Russell Knight | 08 November, 2018, 06:02

On Tuesday, the State Department clarified that Chabahar and an Afghanistan specific railway project (under INSTC) would be kept out of the sanctions for the objective of "development" of Afghanistan.

Iran late previous year inaugurated the port on the Indian Ocean, which is being built largely by India and is expected to provide a key supply route for Afghanistan while allowing India to bypass rival Pakistan to trade with Central Asia and Africa.

With the 180 day grace period coming to an end on Monday, U.S. Secretary of State Mike Pompeo and U.S. Treasury Secretary Steven Mnuchin announced the return of U.S. sanctions on Iran.

The foreign minister further stated that while previous US Presidents have also displayed "disrespectful attitudes" towards Iran, they have eventually changed their stance, and said the Trump administration will have to do the same.

The first phase of the strategically-located project was inaugurated in December past year.

The U.S. sanctions on Tehran come as the Trump administration withdrew from the 2015 nuclear deal with Iran in May, saying it had not stopped Iran from developing its ballistic missile program and intervening in neighboring countries.

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The port provides key supply route to landlocked Afghanistan. Each of those countries has already demonstrated significant reductions of the purchase of Iranian crude over the past six months, and indeed two of those eight have already completely ended imports of Iranian crude and will not resume as long as the sanctions regime remains in place. "These activities are vital for the ongoing support of Afghanistan's growth and humanitarian relief", said the US State Department Spokesperson.

The port in the Sistan-Balochistan province in the energy-rich nation's southern coast is easily accessible from India's western coast and is increasingly seen as a counter to Pakistan's Gwadar Port, which is being developed with Chinese investment and is located at distance of around 80 kms from Chabahar.

"The president's South Asia strategy underscores our ongoing support of Afghanistan's economic growth and development as well as our close partnership with India", the state department spokesperson said.

"This exception relates to reconstruction assistance and economic development for Afghanistan", he said.

Trump's decision has been opposed by European powers as well as other nations including India, which has largely warm relations with Iran.

India, Smith argued, "made a convincing case" that its principal interest in the port was to develop alternative infrastructure links to Afghanistan that bypass Pakistan, which also serves the USA national security interests.

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