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India looks to reduce its involvement in Iran's Chabahar port amid US sanctions pressure

India looks to reduce its involvement in Iran's Chabahar port amid US sanctions pressure

Photograph: (AFP (File Photo)

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Chabahar, located on Iran's southeastern coast along the Gulf of Oman, has long been viewed in New Delhi as a critical element of its regional connectivity strategy.

India is preparing to reduce its involvement in the strategic Chabahar port in Iran, as US sanctions concerns force a rethink of the long-term project.

MEA spokesperson Randhir Jaiswal pointed out how on 28 October 2025, the US Department of Treasury had issued a letter outlining the guidance on the conditional sanctions waiver valid till 26 April 2026 & Indian side 'remains engaged with the US side in working out this arrangement.

US Office of Foreign Assets Control (OFAC) is closely monitoring developments in India's involvement in the Chabahar port. OFAC, the Treasury Department's key sanctions enforcement arm, has kept Chabahar under scrutiny as part of broader American pressure on Tehran.

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Chabahar, located on Iran's southeastern coast along the Gulf of Oman, has long been viewed in New Delhi as a critical element of its regional connectivity strategy. The port offers India an alternative trade route to Afghanistan and Central Asia, bypassing Pakistan and reducing dependence on traditional pathways.

India has invested substantially in the facility over the years, including the development and operation of key terminals. US sanctions have remained a persistent obstacle. Washington has repeatedly targeted Iranian infrastructure projects as part of its maximum pressure campaign against Tehran.

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Delhi has been careful to frame the current phase as a managed, reduced involvement rather than an abrupt exit. As the April 2026 deadline approaches, attention will turn to what form, if any, India's future engagement with Chabahar might take once the current waiver expires.

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Siddhant Sibbal

Siddhant Sibbal, covers diplomacy and defence for WION since 2018. He has been charting Indian diplomacy, including India's rise on the global stage. He has covered major internati...Read More