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From Russia to Iran, India caught in crossfire of US sanctions | India News

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NEW DELHI: A US law, which imposes sanctions on Russia and Iran, is proving to be a stumbling block for India as it tries to strengthen its military partnership with Russia and improve trade ties with Afghanistan via the Chabahar Port.

Last year, US President Donald Trump had signed a law, ‘The Countering America’s Adversaries Through Sanctions Act’, CAATSA, imposing sanctions on Russia, Iran and North Korea. The Section 231 of CAATSA mandates secondary sanctions on those who conduct significant transactions with the Russian defence and intelligence sectors.

India, which is one of the largest military partners of Russia, is likely to bear the brunt of the law meant to punish Russia for its transgression in Crimea, its involvement in Syrian civil war and the alleged meddling in the US presidential elections.

The possible impact of the sanctions will be one of the main agendas of Prime Minister Narendra Modi’s informal summit with Russian President Vladimir Putin.

The immediate focus of today’s meeting would be on the sale of five S-400 Triumf air defence systems for around $4.5 billion from Russia that India’s military sees as a game changer. The systems are touted as being able to counter the ballistic missiles and stealth aircraft that China is developing while overwhelming the capabilities of Pakistan.

The air defence system is not the only worry for India, which has a history of close military ties with Russia. A large chunk of Indian military hardware traces its roots to Russian-based firms.

Russian hardware represented 62 per cent of the country’s total weapons imports during the past five years, compared with 79 per cent in 2008-2012, the Stockholm Peace Research Institute said in a report last month. Russian parts, supplies and maintenance are vital for the Indian security infrastructure.

The issue is crucial to the Indian military because a sanction on procuring military trade with Russia is likely to serve a severe dent to India’s security prospects in the region.

As Russia shares a tumultuous relationship with the west, India’s efforts to forge a strategic partnership with the latter, including the United States, has further complicated the situation.

While some US officials have expressed understanding of New Delhi’s dilemma others have cautioned that

Caatsa
is Congressionally-mandated and the administration’s hands may be tied in terms of waivers if India goes in for new purchases.

“CAATSA is a feature and we need to take it seriously. The (Trump) administration is always bound by US law. This is a US law. I’m hoping that not just India, but all of the partners that we engage with will understand that we will have to evaluate any potential large defence purchase from Russia seriously because that’s what the law demands of us,” Tina Kaidanow, principal deputy assistant secretary of state for political-military affairs, told reporters during a conference call on Saturday.

However, there is a ray of hop for India. The US administration could declare that imposing sanctions on India, a major defence partner, would hurt US national security interests. That would allow a waiver permitting India to do business with Russia.

CAATSA casts a shadow on India’s prospects in Iran’s Chabahar Port

The US law is also likely to have an impact on India’s prospects in the newly-built Chabahar Port in Iran after President Trump decided to pull out of the Iran nuclear accord and re-impose sanctions on Tehran.

The Indian-backed Chabahar port complex in Iran is being developed as part of a new transportation corridor for land-locked Afghanistan that could potentially open the way for millions of dollars in trade and cut its dependence on Pakistan, its sometimes-hostile neighbour.

Chabahar is among a number of projects of transport and energy networks projects designed to boost Afghanistan’s trade and lay the foundations for a mining industry capable of exploiting its billions of dollars in untapped mineral reserves.

The port will also offer an opportunity to India to exploit export iron ore from two tracts at the Hajigak iron mine in central Afghanistan that it won the rights to exploit.

Bypassing the border with Pakistan, which last year was closed for some 50 days over various disputes, Chabahar is seen as a way for Afghanistan to consolidate its relationships with India and other regional powers.

“The only way to get India more involved” in Afghanistan’s economic development “is through Chabahar,” said Barnett Rubin, an expert with New York University’s Center for International Cooperation and a former adviser to the State Department and the United Nations.

But President Trump’s decision to re-impose sanctions on Iran and penalise financial institutions for doing business with Tehran is clouding Chabahar’s viability as banks, nervous they could be hit with crippling penalties, pull back from financing.

Speaking to ANI,

defence
expert, Uday Shankar said, “Chabahar is supposed to enable India to be able to access Afghanistan bypassing Pakistan. When the American sanctions are in place, importing equipment to Iran for a joint project would be a problem.”

“More importantly, India has invested almost half a billion dollars in Chabahar Port creating their infrastructure. It is a relatively nascent stage. Chabahar is a work in progress. But, it has long-term implications. In terms of India, it is having a co-hold in a very crucial maritime part of the region,” he added.

The Iran nuclear deal was signed between six countries in 2015 – Iran, the US, Britain, Germany, Russia, France, and China for lifting economic sanctions on Tehran in exchange for limitations to the country’s nuclear programme.

Earlier this month, President Trump had announced the US withdrawal from the Iran deal or the Joint Comprehensive Plan of Action (JCPOA), calling it as an “embarrassment” and “defective at its core” and citing that the deal has failed to protect America’s national security interest.

Other world powers have vowed to uphold the landmark deal. The deal places restrictions on Iran’s nuclear programme.

(With inputs from agencies)

Updated: May 21, 2018 — 1:07 pm

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