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BHARAT KARNAD | 23 MAY, 2016

PM Modi Visit: Too Late to Make Good In Iran?


Posted on May 19, 2016 by Bharat Karnad

NEW DELHI: Prime Minister Narendra Modi on his visit to Iran has finally signed the tripartite Chabahar port agreement, also involving Afghanistan, and deliver on the $20 billion promised that country as follow-up to Iran’s handing over the Farzad-B gas field to set up a gas cracker unit and a liquefied petroleum gas extraction unit.

The more significant thing to see whether PM Modi will opt for the Iran-Pakistan-India (IPI) gas pipeline to carry the gas, the more expensive undersea pipeline to pump Farzad gas to an Indian port for onward distribution, or whether he’ll have the foresight to approve both these pipelines — there will not be a time in the next Century when India will not need Iranian energy.

But if, given meagre resources, GOI has to choose, one hopes he will have the audacity to think strategic for a change — something his advisers have scant talent for — to opt for the IPI pipeline and initiate, at long last, the slow process of weaving the economies of the states of South Asia into a semblance of unitary economic space.

A critical mass of thinking is evolving in Pakistan that sees the futility of terminal enmity and the fact that this path is absolutely not affordable for Pakistan. (See two articles in todays’ Pakistani newspapers — The News, and Express Tribune. Truth be told, India — even though limping towards the status of the third largest economy, can afford it even less because its problems are more massive and will require great foresight to tackle.

Iran has always been the energy lynchpin for India, a fact Tehran appreciated early on but New Delhi predictably didn’t, at least not in the decade 2004-2014. The Congress party government of Manmohan Singh regime was too busy trying to please and placate the United States by ensuring Indian policies conformed with Washington’s, to pause and contemplate whether this line helped India’s cause or even its larger security interests.

If Washington decreed Iran a grave threat and sought to isolate that country by applying the financial tourniquet to its economic jugular, why, New Delhi was right there with America, in effect, supporting the regime of restraints imposed on Iran.

Once the Obama Admin resolved the outstanding issues — in particular the future of Tehran’s Bomb programme — that regime was promptly ended, even as American companies rushed to Tehran to cut deals. The habitual laggard, India, followed but now with lot less leverage in Tehran.

True, Iranian President Hassan Rouhani did say, in the presence of the visiting Indian external affairs minister Sushma Swaraj in April this year, that the India-Iran ties defined a “partnership which has the potential of connecting the entire region”, which is a truism. But it is nothing as effusive as what Tehran used to say during the long winter of its isolation when it was desperate for friends and, especially India, to help it out, assist in ways for it to transact with the outside world — “a friend in need…”.

It was an opportunity Delhi irretrievably lost, because Manmohan Singh was intent on a nuclear deal with the US that, besides freezing India’s strategic capabilities at the level of a failed thermonuclear weapon design — necessitated, as his government saw it, hewing to US policy likes and dislikes.

It was during this period that the first substantive offer was made to India of the Chabahar port as India’s entrepot to Afghanistan and Central Asia and, not to be undervalued, its utility to the Indian navy as base outflanking the Chinese setup in Gwadar, just 70 miles or so down that coast to instantly neutralize any big Chinese naval designs in that area.

Modi’s government is still to figure out the means of transferring $6.5 billion in outstanding dues for Iranian oil and gas imports in the past because the usual international banking channels working out of New York, London and Western Europe were closed off by Washington. But this payments is a microcosm of the problem India faces every time its government loses sight of the national interest. New Delhi, I have long maintained, institutionally lacks what the great theorist and practitioner of geopolitics Halford Mackinder called, “the map reading habit of mind”. One deko at the map would have made it clear why Iran, for various reasons, is central to India’s strategic concerns, again something Tehran recognized before there was a flicker of understanding at the Indian end.

Quite apart from the military importance of Chabahar, with road and rail grids radiating northwards through Afghanistan to Central Asia to the northeast and to Russia’s Northern Distribution Network to the northeast, India is offered trade lifeline skirting the sea route, connecting Chabahar directly to St Petersburg or southwards to the ports on the Baltic coast.

With the transport and communications lines in flow, Afghanistan can be endlessly supported from landward — to protect India’s centrality in that country, while offering Indian commerce easy access to the Central Asian markets. Not to be forgotten that, as part of this general scheme of things, Tajikistan had offered the Indian Air Force the use of its Farkhor air base in Ainee. Su-30MKIs based there would have been on line of sight target runs to the Chinese nuclear complex at Lop Nor in Xinjiang — a useful stick to have in hand should the situation ever heat up with China.

Yes, the Russians are reasserting their presence in Central Asia, and the Farkhor base, that India has re-metalled and enabled for launch of air operations and its use is a matter of contention (because Moscow fears India getting too close militarily to the US). But had Delhi shown the resolve and a genuinely independent foreign and security policy, many of these problems wouldn’t have arisen in the first place.

When the geostrategic relevance of Chabahar was never in doubt, why did Delhi take so long to ink a deal? Once the decade long opportunity to get in close with Tehran was lost, and the occasion to capitalize on Iranian gratitude for befriending it when no other major country would, was wasted, once the Iran marketplace opened up the US eased up on financial and transactional restrictions, instead of being moved to head of the line for every consideration — which would have meant mainlining India’s manufacturing into the Iranian market, Delhi, without money muscle of a China, found itself at the back of the line, with Tehran looking and sounding less and less eager to give any concessions to India, or hand it any advantage whatsoever.

Instead of tying up the Iranian domestic market — on pure barter terms because money transactions were difficult, we could have exported masses of automobiles and auto accessories, light industrial and consumer goods, besides traditional exports like Basmati rice, etc and otherwise kicked the Indian industry into a higher gear and solved a part of the unemployment problem — India now has next to no such gains and next to nothing by way of accumulated goodwill and leverage.

The negotiating therefore has descended to the bazaari level, even where Chabahar was concerned. After all, Indian and Iranian bazaars are notorious for their skills at negotiating a price for any product. Access to Chabahar is a big thing and Tehran was determined to get the maximum — because there was no great love or gratitude o anything. Being a straightforward, almost commercial, transaction, it became a matter of ego and negotiating tactics carried out with bazaari flair for bargain-hunting. When earlier Chabahar was available for India with Delhi needing to help construct a south-north railway line, now India is paying dearly not just to refurbish and modernize the seaport itself but also for establishing and paying for the support infrastructure to extract and transport Farzad-B gas.

It is a matter of wonderment how Delhi can get it so wrong so often?

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