Joint Comprehensive Plan of Action (JCPOA)
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Context: US restored sanctions waivers to Iran to allow international nuclear cooperation projects, as indirect American-Iranian talks on reviving the 2015 international nuclear deal with Tehran enter the final stretch.
More about news:
- The waivers had allowed Russian, Chinese and European companies to carry out non-proliferation work to effectively make it harder for Iranian nuclear sites to be used for weapons development.
- The indirect talks are aimed at having the United States return to the Joint Comprehensive Plan of Action (JCPOA) agreement and Iran resume compliance.
- JCPOA is designed to serve US non-proliferation and nuclear safety interests and constrain Iran’s nuclear activities.
The 2015 JCPOA agreement
- It sought to cut Iran off a possible path to a nuclear bomb in return for lifting of economic sanctions.
- Iran agreed to cut its stockpile of enriched uranium by 98% to 300 kg and keep them at a low purity level of 3.67%. In return, the Obama administration lifted sanctions.
- Restrictions were introduced on the number of centrifuges it could keep and Iran agreed to open all its facilities to the inspection of the International Atomic Energy Agency (IAEA).
India-Iran
- Trade with central Asia: Iran-India relations are of vital importance for India because of Iran's Chabahar port, which plays a fundamental role in India's trade connectivity with Afghanistan, Central Asia, Eurasia and Europe.
- Energy security: India being the second largest importer of crude oil from Iran has begun to effectuate a plan to ensure that there is no shortage in supply by increasing imports from other countries.
- Sanction impact: The immediate impact of the sanctions on India was that it can no longer use US dollars for transactions with Iran.
- Investment by Indian companies in Iran's oil and gas development projects and pipeline projects, not permitted to open new US bank accounts and facing restrictions on loans, licences and Ex-Im credit.
- In December 2018, India and Iran agreed to revive its 2012 rupee-rial payment mechanism to receive payments in Indian rupee, where half of the payments would be used to import products from India.
Impacts of Iran’s sanctions on India:
- Energy security: Cutting down crude imports from Iran will impair India’s energy-security needs affecting inflation and slow down economic growth.
- China’s growing presence: In the absence of Indian infrastructural development projects in Iran, the vacuum created is likely to be filled by China amid fast-changing geopolitics.
- Lack of clear policy: India’s policy towards Iran and developments in the Middle East has been largely reactive.
- Create a balance between U.S. and Iran: In the backdrop of tensions between US and Iran, India has had to re-adjust its own relations with Iran while maintaining strategic ties with US and Israel.
Conclusion:
India needs to emerge out with a clear foreign policy and choose an alliance to not only safeguard its interests but also to play an active role on the international stage.
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