Trump signed a national security presidential memorandum on Tuesday to reimpose the tough policy on Iran practiced during his first term. The threat of secondary US sanctions during that term had forced India to stop Iranian crude oil purchases in May 2019. Till then, Iran was among India’s top three energy suppliers.
The new US presidential memorandum directs secretary of state Marco Rubio to “modify or rescind sanctions waivers, particularly those that provide Iran any degree of economic or financial relief, including those related to Iran’s Chabahar port project”.
The memorandum further directs the US permanent representative to the United Nations to “work with key allies to complete the snapback of international sanctions and restrictions on Iran” and to hold Tehran “accountable for its breach of the Nuclear Non-Proliferation Treaty”.
There was no official response from the Indian government on the impact of the memorandum, especially on Chabahar port, where an Indian state-run company operates the Shahid Beheshti terminal. People familiar with the matter said on condition of anonymity that authorities are assessing the potential impact of Trump’s memorandum.
“The memorandum indicates that the US secretary of state will have to take a call on the sanctions waivers, including those related to Chabahar. A lot will depend on what steps the secretary of state takes,” one of the people cited above said.
The people noted that Chabahar is an important project for India in the context of New Delhi’s regional trade and connectivity initiatives, especially the International North-South Trade Corridor (INSTC) and moves to access markets in Central Asian states. India’s budget for 2025-26 retained an annual outlay of 100 crore for Chabahar port, reflecting the importance of the facility in these initiatives.
Also Read:The road ahead for Indian operations at Chabahar port in Iran
An Iranian official, who declined to be named, said Tehran will formally give a response to the move by the Trump administration.
While the first Trump administration had forced India and other countries to completely stop Iranian oil purchases in 2019, it had allowed New Delhi to go ahead with operations at Chabahar.
After India and Iran signed a 10-year agreement for India’s long-term operations at Chabahar port in May 2024, the Biden administration had warned all entities considering any business deals with Iran face the “potential risk of sanctions”. Despite the warning, the US didn’t subsequently take any action targeting the development of Chabahar port.
The long-term agreement was aimed at facilitating the long-term development of Shahid Beheshti terminal at Chabahar, where operations are run by a subsidiary of state-run India Global Ports Limited (IGPL). The firm plans to invest $120 million on further equipping the terminal and India has offered a credit window of $250 million to improve infrastructure around Chabahar.
The US granted a carve-out for Chabahar from its sanctions regime for Iran when New Delhi, Tehran and Kabul signed a tripartite agreement for developing the port in 2016. At that time, the US decision was influenced by the port’s potential to facilitate trade and development in Afghanistan and lobbying by the Indian side.
Even when Trump withdrew from the Joint Comprehensive Plan of Action (JCPOA) in 2018 and announced fresh sanctions against Iran that resulted in India completely ending Iranian crude purchases, Washington retained the carve-out for Chabahar port.
India and Iran see Chabahar, a deep-water port in Sistan-Baluchistan province, as a hub for the INSTC, which will allow shipping companies to use an alternative route that bypasses the sensitive and busy Persian Gulf and Strait of Hormuz. The port is also key to India’s ambitious plans to forge greater connectivity and trade ties with Iran, Afghanistan and the landlocked Central Asian states.
