India secures 6-month US sanctions exemption for Iran’s Chabahar Port

India confirmed on Thursday that American sanctions will not apply to its investments in Iran’s Chabahar Port for the next six months.

The Ministry of External Affairs (MEA) said the exemption allows operations at the strategically important port to continue without disruption.

The announcement comes as India and the United States continue negotiations to finalise a long-awaited trade deal.

MEA spokesperson Randhir Jaiswal said that India continued to remain engaged with the U.S. side on finalising the trade deal, adding that discussions were ongoing between both sides. He further said that inquiries should be directed to the Ministry of Commerce for any additional updates.

Last year, India signed a 10-year agreement with Iran under which state-run India Ports Global Ltd (IPGL) committed $370 million in investments to develop Chabahar Port. Located in Iran’s Sistan-Balochistan province along the southern coast, the port provides India a key maritime gateway to the Indian Ocean and is critical for delivering humanitarian aid to Afghanistan.

The port also holds strategic significance for Afghanistan, offering the landlocked country direct access to the Arabian Sea and bypassing Pakistan. India currently operates the Shahid Beheshti terminal at Chabahar.

US sanctions on Chabahar came into effect in September as President Donald Trump’s administration sought to increase pressure on Tehran. The measures were part of broader UN sanctions imposed on Iran over its nuclear programme.

This is not the first time India has received an exemption.

In 2018, the Trump administration had also made an exception for Indian companies developing Chabahar, even as it imposed sweeping unilateral sanctions on Iran, whose main port at Bandar Abbas was operating at full capacity.

The MEA said that India was reviewing the implications of the recent U.S. sanctions on Russian oil companies, noting that it was studying the matter and that its decisions naturally took into account the evolving dynamics of the global market.

Jaiswal added that India’s position on the broader issue of energy sourcing was well-known and that the country was guided by the imperative to secure affordable energy from diverse sources to meet the energy security needs of its 1.4 billion people.

External Affairs Minister S. Jaishankar had previously defended India’s purchase of Russian oil amid Western criticism. In April 2022, he remarked that if anyone was looking at energy purchases from Russia, their attention should be focused on Europe. He said that India did buy some energy, which was necessary for its energy security, but suspected that the country’s total purchases for a month were probably less than what Europe bought in an afternoon.

Meanwhile, Commerce and Industry Minister Piyush Goyal said India and the US are “very near” to finalising their bilateral trade deal. However, he emphasised that India will not rush into an agreement. Goyal said, “India-US trade talks are progressing,” and expressed confidence that both nations would work towards a “fair and equitable agreement” soon.