China-Iran strategic deal: Where does India stand? | By Dost Muhammad Barrech

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China-Iran strategic deal: Where does India stand?


MARCH 27, 2021 is a momentous day in the annals of the history of China- Iran relations, as both states on that day inked a 25-year economic cooperation deal.

The deal, by and large, will bring rapid geo-political and geo-economic changes in the Middle East.

Iran was desperately waiting for such a historic deal to happen in the backdrop of the US sanctions against the former.

China, meanwhile, is deeply pondering over the regional dynamics, trying to exploit the rift between the US and Iran, will capitalize Iranian oil and gas to keep its industries running.

China-Iran strategic deal and growing convergence of interests between them puts New Delhi in a deep quandary.

The deal turns out to be a burning issue in the sphere of area experts: However, a question remains: how does India view the China-Iran deal?

New Delhi is fully cognizant of the emerging realities in the region, knowing the deal will expand China’s political and economic influence in the Middle East, creating worries for India.

Beijing will invest US $400 billion in Iran, a whopping amount of US$ 280 billion is anticipated to be invested in Iran’s energy sector, the remaining US$120 billion will be invested in Iranian banking, telecommunications, healthcare, ports, railways and information technology.

The deal also underpins military cooperation, training exercises and intelligence sharing between the two countries.

Chinese US$ 280 billion investment in Iranian energy sector jeopardises the Indian oil and gas imports.

Experts assume China’s presence in Iran’s energy sector will halt India from Iranian oil and gas import. As the saying goes “whoever controls energy, controls destiny”.

The said adage is likely to be true as far as controlling of Indian destiny is concerned. A political analyst on Eurasia Esref Yalinkilicli, maintains, “You can see China wherever oil is”.

Since 2017, China has remained the world’s largest importer of oil and in 2020 had surpassed the US, the former currently is the largest importer of oil.

It is pertinent to mention here that China, despite the US sanctions on Iran, has continued to be the largest importer of Iranian oil.

Engrossingly, the deal is also a part of a new cold war alliance in the region. China intends to counter the Quad known as Quadrilateral Security Dialogue led by the US; the former has resultantly been spearheading an “alliance of autocracies” attributed to forming “trans-Himalayan Quad”.

India and Iran in existing global power competition of the US and China witness a vivid divergence.

New Delhi is a main player of the US in promotion of Quad and democracy while Iran, a crucial ally of China in consolidation of Chinese led “alliance of autocracies” promotes Chinese interest greatly.

Presumably, “Quad vis-e-vis alliance of autocracies” will deepen the rift between New Delhi and Tehran. The deal has also been making China the pivot to the Middle East.

Fatima Karimkhan, a Tehran-based journalist, regards the deal as “one of the first steps for China in its way to find a more stable path in the Middle East”.

The relative decline of the US in the Middle East paves the way for strengthening China’s position in the region.

The Biden Administration seems to be following in the footsteps of his predecessors “pivot” away from the Middle East to Asia-Pacific region.

The US pivot to Asia-Pacific lucidly creates a vacuum for China that will leave no stone unturned to fill the void resulting in underpinning its foothold in the Middle East.

China is a leading trading partner and a pivotal ally in the region, providing sophisticated technologies and ammunition to the regional countries eroding the Indian influence by leaps and bounds. However, the deal under the umbrella of China brings Iran and Pakistan further closer.

China’s presence in Iran will considerably address security concerns of Pakistan emanating from Iran to the China-Pakistan Economic Corridor (CPEC).

Needless to say, cordial ties between Islamabad and Tehran, by no means, serve New Delhi’s interest.

India’s lacklustre demeanour made it unsuccessful in construction of Iranian Chabahar port within stipulated time frame.

The Chabahar project witnessed recurrent adjournments, the project stopped twice in 2018 followed by 2019 that triggered Iran’s mistrust on India.

Experts contemplate that New Delhi is unable to handle an exerting pressure of the US will eat humble pie in construction of the Chabahar port.

India has resultantly been dropped from Chabahar port by its delayed funds, dropping India from Chabahar port reduces its access to Afghanistan and Central Asia invariably bolsters China’s position in the region.

Tehran will never forget a betrayal of New Delhi, when the latter tried to win the confidence of Washington, voted against the former in September 2005 in International Atomic Energy Agency session in the implementation of the non-proliferation treaty. Indian duplicity then opened the way to the US sanctions against Iran.

Geo-political landscape of the region in the emergence of rising China provides a golden opportunity to Iran to remove its isolation in the international arena, bolster fragile economy and to improve its tarnished image. In short, the deal further buttresses China’s position in the Indian Ocean.

The 21st century is the Indian Ocean century; whoever dominates the Indian Ocean will, undeniably, dominate the world.

China’s foothold in the Indian Ocean particularly in Gwadar and Chabahar ports as well as in the Strait of Hormuz would pose a huge challenge to the Indian interests.

—The writer is a Research Associate at India Study Centre, Institute of Strategic Studies Islamabad.