Heartburn in Washington: India Calls Iran “Critical” to their Energy Future

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By John C.K. Daly, the chief analyst for Oilprice.com. Cross posted from OilPrice

It is no secret that the South and East Asian economies have chafed under the multi-layered sanctions adopted by the United States, European Union and United Nations Security council against Iran for its civilian nuclear activities.

Many in the West see Iran’s nuclear efforts as masking a covert weapons program, which Tehran has stoutly denied.

For the moment India, Korea, Malaysia, South Africa, Sri Lanka, Turkey and Taiwan have dodged the penalties accruing from violating U.S. sanctions, as in June 2012, the Obama administration granted exemptions based on reductions of oil purchases from Iran of about 20 percent.

The waivers were renewed on 7 December 2012 for another 180 days, while seventeen EU countries have not been granted exemptions.

Which brings us up to now.

One of the ‘waivered” countries, India, has stated that Iran is “critical” to India’s energy security, a development certain to cause major heartburn in Washington.

Adding to the Obama administration’s concern is undoubtedly the fact that the observation was made not by a low-level functionary but rather, External Affairs Minister Salman Khurshid, who told reporters, “We are looking at re-energizing the national North-South Corridor to connect India with Central Asia and Russia through Iran, we are looking at trans-Afghan routes using Iranian port of Chahabar particularly to get access to Afghanistan, Uzbekistan and Tajikistan. We are looking at a rail link from Kazakhstan to Turkmenistan into Iran. Of course, it does make Iran very critical. On the other hand, it makes Afghanistan very critical. Therefore, we hope that within our philosophical approach of being friends, we get Afghanistan back to a stable situation. Afghanistan will then become a bridge for us to Central Asia and Iran as well.”

Lest no-one be in any doubt about the import of Khursid’s remarks the minister added, “(When) Iran will be able to find a resolution with the European Union + 1 on the issue of nuclear energy so that Iran also becomes an important link between us and Central Asia. It will give us far greater access to Central Asia than we have now.”

Interestingly, Khursid’s remarks at a three-day conference on Central Asia held at the Kashmir University come a mere five days after he met with U.S. Secretary of State John Kerry in New Delhi on 24 June. Amid the diplomatic praise Kerry said, “…both of us are particularly eager and committed to taking this relationship to new heights. India and the United States, two of the most powerful economies in the world, two democracies, two countries that share so much in terms of our values and our aspirations, we believe have an opportunity to be able to set a new standard for cooperation on a number of challenges that we all face.”

Shaun Tandon of Agence France Presse asked Kerry, “I wanted to follow up particularly to the Foreign Minister on the issue of Iran. India has kept open dialogue with Iran, has a much better relationship with Iran than the United States does. What was the nature of your discussion, if any, on Iran, and your hopes or your considerations about President-elect Rohani? Thanks.”

Kerry did not mention Iran in his reply.

All of which leads to the following observations.

While the Indian government is extremely interested in an approved relationship with Washington, it will not abandon its own national interests, which include energy security, of which imports from Iran constitute a significant element.

Secondly, New Delhi is looking at the “bigger picture,” beyond 2014, when the U.S. and International Security Assistance Force drawdown of forces from Afghanistan is due to be complete. India wants a pacified post-occupation of Afghanistan as much as do the post-Soviet states of Central Asia, seeing a quiescent Afghanistan as a major potential economic transit route.

Accordingly, the diplomatic minuet between Washington and New Delhi will continue for the foreseeable future, with the unspoken but overriding question being, who needs the other more?

At the end of the day, Washington cannot make up India’s energy shortfall if it completely abandons Iranian energy imports, and, as India will be a major political player in post-occupation Afghanistan, one can reasonably expect to see a “diplomatic” solution in the probable form of extended “waivers” if the Obama administration wishes to retain a major regional ally.

The “Great Game” continues.

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  1. Lonely_in_Dallas

    While the Indian government is extremely interested in an approved relationship with Washington” is an amazing Freudian slip. Perhaps the author meant to say “improved relationship” but for the most part it has indeed been “approved relationship” all right!

  2. frosty zoom

    well, well, a dangerous thread to be commenting upon (hi guys!).

    anyhoo, that sure makes the whole afghan thing moot. such a waste. never did get that pipeline.

    perhaps mr. snowden’s information is becoming the breeze that sends the whole house of cards tumbling.

    this is sure going to put some sauerkraut on mr. obama’s hot dog.

    1. psychohistorian

      The question that keeps coming into my mind is whether or not Amerika the Empire will use its nukes in an attempt to stay “top dog”????? It is the height of fear we can create which pales in comparison to Mother Nature but our class society has bred sociopaths at the top.

      And how would the US public respond to such a war crime? USA! USA! USA!

      Where are those more evolved aliens when you need them??????

      1. brazza

        I didn’t think there was anything I could read that could penetrate my calloused skin … but your comment just made me shudder.

      2. Tulsatime

        No Chance. We will have the natives at each other’s throats before we burn one of our presciousi warheads. They can burn their own warheads when it gets down to water.

      3. Roland

        The Western Bloc, and especially the hegemon USA, notwithstanding their relatively declining shares of global output, have retained their legacy advantages in warmaking. War is one sector of human affairs in which the Western countries still enjoy a strong competitive edge.

        It is a very interesting question whether there could be a falling-out between segments of the global capitalist elite, culminating in the Western elites’ deciding to employ their legacy advantages to direct effect.

        On the one hand it shouldn’t happen. The globalist bourgeoisie has the world all nicely sewn up, for a long time to come. Surely everything else can be sorted out with no more than occasional local discomfort?

        On the other hand, the US elite, while having created our post-national global capitalist environment, nevertheless seems determined that theirs is to be the sole sovereignty which is to be deemed indispensable, never to be eclipsed.

        i.e. all globalist bourgeois elites are equal, but some are more equal than others!

        Therefore even today one cannot altogether discount the possibility of dangerous confrontation between great powers. I find it hard to believe that such confrontation could approach in scale or severity the famous 20th century struggles for world power, but perhaps we could be in for one more round of the game.

        From a military point of view, the answer to that question depends on whether the USA can successfully carry out a disarming first strike against an opponent with a relatively small nuclear arsenal (such as China or India).

        The “disarming first strike” is, of course, the Holy Grail of nuclear war strategy. The ability to launch a successful first strike, without suffering unbearable retaliation, is the key to nuclear strategic superiority. It might not even be necessary to actually carry out such a strike, as long as others are convinced that that it is possible. They would concede to the USA the “escalation dominance” — in other words they would tend to back down over any issue over which the USA indicates a willingness to escalate.

        Favouring the USA in such an endeavour would be the following factors:

        1. Surveillance and targeting systems have never been so good as they are now. Never has the USA possessed better information on where other country’s nuclear weapons are deployed. More importantly, never has the USA possessed better information about others’ command and control of their nuclear forces. Nuclear command and control can be decapitated since most governments are understandably very reluctant to devolve nuclear attack authority below the highest levels.

        2. The USA’s stealth technology is mature and effective. There is a reasonable chance that a minor nuclear power’s arsenal could come under heavy attack by the USA before its defenses can be alerted.

        3. Delivery systems have never been so accurate. Fewer weapons need be used since fewer will miss. The yield of a weapon doesn’t have to be so large, in order to obtain the desired destructive result. This might make possible a relatively “green” nuclear war, that would have astonishingly little environmental impact compared to its military effect. Remember that we’re not in the 1960’s when multi-megaton yields were needed to compensate for miserable accuracy.

        4. Ballistic missile defense systems are sufficiently developed today, after over thirty years of steady R & D, that they can be effective against the remnant retaliatory forces that would remain to a minor nuclear power after they have been mostly disarmed by a US first strike. Note that from its inception BMD was always been intended to work in conjunction with a first strike. BMD systems are only defensive in the tactical sense; they are strategically offensive.

        Some may object that BMD systems are ineffective. It is true that the majority of media stories are about failures. But that is probably deliberate disinformation. The USA would not want to warn potential foes, who might start to invest heavily in countermeasures, or at least expand their deterrent forces.

        One might simply observe that every American administration since the mid-1980’s has continued the BMD programmes, without interruption. Given the many other claims upon defense expenditure, I find it unlikely that so many administrations, regardless of faction, would have followed the same policy unless they found BMD promising.

        5. Even Russia’s nuclear arsenal is much smaller today than in the past. Most dangerously for Russia, their submarine-based retaliatory forces, which in the Cold War were the final bulwark of nuclear deterrence, today are obsolete, easily tracked, and easily destroyed. Russia is not as vulnerable as China or India to a US first strike, but even they cannot rest easy, since most of the technological developments of the past 25 years have favoured the potential aggressor.

        Even with so many factors in favour of US/NATO nuclear aggression over the course of, say, the next 20 years, I still wouldn’t think it likely. I think that the elites in Russia, China or India would all back down and submit to a permanently unfair division of global spoils sooner than escalate a conflict to the point where they would have a major military clash under conditions that heavily favour the Western Bloc.

        After all, we’re talking about bourgeois here. As a class (not as individuals), the bourgeoisie are cowards, in both the the physical and the moral sense. If we were talking about pre-capitalist aristocrats, or even Roman senators, things would be a bit dicier, because considered as classes, those people might be satisfied with an outcome that a bourgeois would be culturally unequipped to comprehend.

      4. PaulW

        If the US public won’t rise up over the destruction of their living standards then they certainly won’t rise on behalf of a bunch of dead Iranians.

        They don’t need to use their nukes. Israel/USA bombing nuclear power plants will have a similar effect. Such insanity will create fall out over the entire region and pollute the atmosphere. But all options are on the table.

        I’d say it is all a question of degrees. With each action by our rulers more people become aware as to what they are all about. The grand illusion of Right, Honourable and working for society’s best interest is fading from view. Bombing nuclear plants or using nuclear weapons will just confirm to more what psychopaths these people really are. But what good is it being right when one is powerless to change anything?

        1. minh

          Russia, China, and especially Iran could also target nuclear plants in the US or Western Europe for sure. The cost of training saboteurs is much less compare to developing nuclear capability and the mean to deliver the weapon. After the Fukushima accident, Germany has came to the realization of this danger. The only problem with the saboteurs is they will eventually get caught, or made up by media spin saturation like 9/11 coverage, and thus can be used only in open warfare, nuclear or otherwise. That is why the NSA has all ears in all direction, and allies like Japan, Germany or Italy, once were adversaries, are more scrutinized than Anglo speaking ones – England, Australia, Canada or New Zealand.

          It is also uncomforting to imagine how many few-kilotons suitcase-nukes may have been easily smuggled across borders, transported by means widely available, and placed as close to the target as possible.

          I don’t think the US will even contemplate on such open warfare, even with the Chinese, who may not have such weapons planted in the US, but who can be sure ?

  3. Emma

    I’m sure Iran will be all the more critical to the energy (and security) future of India because of the Chinese Pakistani deal signed earlier this year.

  4. Fiver

    When I saw the headline, I was heartened by the thought that a country larger than Ecuador would finally tell this craven Admin to shove it.

    However, what is quoted and noted proved somewhat deflating, as there is nothing in India’s stand as reported to cause alarm. They’ve said only that Iran matters, that Afghanistan matters, and hopefully things will change for the better, a condition very much in the eye of the beholders in Teheran, Kabul, Northwest Pakistan et al.

    The one thing that could possibly resolve this conflict is not on the table – an end to the US war on the entire region.

  5. rob

    Politicians make hay of relations with the iranian gov’t.My guess is that even dick cheney himself and halliburton would be willing to do deals and make money from iranian oil.Or even selling iran nuclear power plant parts.as long as they could say.”it wasn’t us, it was a subsidiary…I mean a wholly indepenent company based in india”, just like they did with iraq in the nineties.

    For all the bluster, politicians may pretend, and even may hate each other… but really”business as usual rules the day,and the night too.
    The religious fundementalists at the head of the iranian councils…make money when no one is allowed to look.And the taliban,gets an embassy, and the US tap-dances with “negotiations”, with a group,not affiliated with a nation-state…And the business who are trans-national but call the US home (when convienient), will do business with anybody for profit.

    So ,all I see with this article is a back door to business.a little brier rabbit.

    1. Synoia

      My guess is that even dick cheney himself and halliburton would be willing to do deals and make money from iranian oil.

      They already made deals with the Iranians, in 1980.

  6. allcoppedout

    Some Indians see nearly all these countries as part of their ancient empire when Persia and Greece were in their dads’bags. The US sees India as a key ally against the Chinese (yet has strangely armed the Chinese with manufacturing). Some of us think WW1 was started by a British invasion of Iraq in 1913 inspired by the building of the Berlin – Baghdad railway and growing oil production around Baku and attempts to build export infrastructure. UK/US commercial interests wanted to keep the price up. We are also inclined to think Iraq2 was about keeping oil prices high enough for profits in the North Sea and other low margin production zones. All this threatened rail building may go boom. The first try will be to entice Iran into Syria, maybe a false-flag operation against Israel and a rescue of Iran from the Mullahs. Quite how “we” are going to get Indians to die for this and administrate in Iran I don’t know. I can believe “we” could get them to die taking Pakistan from the vile Muslims and taking their oil and gas in their new western partnership. This would probably involve Japan and China on opposite sides.

    Boom-boom, as Basil Brush used to say.

  7. Emma

    The real issue here which everyone seems to be ignoring is the fact that, due to corruption, cronyism, bureaucracy, political infighting, mafia orchestrated theft of both coal and equipment, strikes, government mismanagement (recall the worlds biggest ever blackout cockup last year leaving 600M Indians across 20 States without power) ie. everything that plagues and contaminates India to its’ core, the gap between what India produces and consumes has spiraled out of control.
    This is despite the fact that India has more than abundant coal reserves and still imports additional coal from Australia. According to the IEA, electricity consumption in India is growing 7% annually while the domestic coal supply (India relies on 70% coal for its power), including imported coal, is only increasing by less than 4% annually, and around 400M Indians are yet to obtain access to electricity whilst the population growth is expected to continue to rapidly increase from the present 1.2B.
    It would be nice to think that India could look at home for a solution and develop its energy potential but it cannot. India seriously needs Iran just like our planet needs O2.

  8. Crazy Horse

    India doesn’t “need” coal or for that matter Iranian oil any more than the planet needs melted Arctic ice caps or more Co2 in the atmosphere. It needs birth control, and a population reduction to less than half its present level.

    Do Indians need access to electric power? Of course, but only if it comes from sustainable sources like the sun and wind, or virtually unlimited sources like thorium or the earth’s core heat.

    One of the many faults of the human species is its inability to think of a future beyond the life span of the generation currently in power.

  9. Crazy Horse

    So is it NC or Homeland Security that is censoring all posts that originate from me?

  10. Me

    So is it NC or Homeland Security that is censoring all posts from Crazy Horse or Thors Hammer?

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