India’s Ambassador to the United States announced on Thursday night – as Narendra Modi clinched a second five-year term in office – that his country would no longer import Iranian oil.
India is the latest country to fall into line with far-reaching US sanctions on the Islamic Republic. In April, Indian imports of Iranian oil had already dropped off by 42% to 1.41 million tonnes, the Economic Times of India reported citing oil ministry figures.
The upset for Iran comes after its top diplomat, Javad Zarif, flew in for a visit with his Indian counterpart earlier this month – an extraordinary move in the midst of a campaign. External Affairs Minister Sushma Swaraj informed him that a decision would be made on Iranian crude imports following the election.
The decision appeared to have already been made, however, as the announcement came immediately after Modi’s victory was assured.
“That’s it,” Indian Ambassador Harsh Vardhan Shringla told reporters in Washington on Thursday night, referring to the final shipments in April. “After that, we haven’t imported any,” he said, in comments published by AFP.
India indicated earlier that it had made alternative arrangements to prevent an interruption in oil supplies. What was left unstated, Asia Times reported earlier this month, was the extra cost of replacing Iranian oil. Until May 2 this year, nearly 11% of India’s oil imports were coming from Iran.
And last year, Iran was India’s third largest provider of crude, following Iraq and Saudi Arabia. In 2019, Venezuela had taken that third place, but India has also weaned itself off petroleum from Caracas to stay in step with its ally, the US.
In his press conference in Washington on Thursday, Ambassador Shringla referred to Iran positively as “an extended neighbor” of India and said his country was viewing tensions between the US and Tehran from the vantage point of a “third party”.
“We would not like to see a move towards any escalation in any way in that area, for the simple reason that we depend very heavily on stability in that part of the world,” he said.
The US’s reimposition of sanctions began in November 2018, six months after the Trump administration abandoned the Iran nuclear pact, which Russia, China, the UK, France and Germany also signed.
Washington has since pressured trade partners and oil clients of the Persian Gulf nation, plus the remaining signatories, to stop doing business with Iran or face penalties.
While the State Department initially issued waivers for eight major importers of Iranian oil, including India, it announced in April that those exceptions will be halted.
The Trump administration’s “maximum pressure” campaign aims to drive Iran’s oil exports to zero so that the petroleum-dominated economy runs out of cash and is forced to accept American terms.
But it is unlikely that Washington can choke off Iran’s oil revenues completely, according to experts, who say the Islamic Republic will likely continue selling under the table.