Oil sovereignty

| Updated on November 15, 2017

India has done well to resist US pressure and insist on its right to import Iranian oil.

India has done well to gently rebuke US attempts to force it to reduce oil imports from Iran. While it is in India's interest to prevent the Islamic Republic from acquiring nuclear weapons capability, which can potentially set off an arms race in an already sensitive West Asian region, this is something that must be done as part of multilateral efforts. The United Nations' (UN) sanctions against Iran's refusal to halt its uranium enrichment programme now do not cover oil. While the US and the European Union (EU) may have imposed embargoes targeting Iranian oil sales, these surely cannot pass off as international law binding on a third country. India bought almost 17.5 million tonnes of crude from Iran in 2011-12, which represents over a tenth of its total imports. Although Iran may have ceded its No. 2 supplier slot (after Saudi Arabia) to Iraq and Kuwait in the last one year, the absolute quantum of purchases by India from it is still quite large. There are obviously limits to reducing these imports or further diversifying the sources of crude supplies, notwithstanding the visiting US Secretary of State, Ms Hillary Clinton's, exhortations to India to “do more”.

It is in this context that one must appreciate the firm and balanced position of India, forcefully articulated by the External Affairs Minister, Mr S.M. Krishna. At a joint media interaction in the presence of Ms Clinton, the Minister maintained that while India is committed to “rigorously implement” UN Security Council resolutions with regard to Iran, any decision on cutting crude imports is for the individual refineries to make “based on commercial, financial and technical considerations”. In other words, without a clear UN mandate, there is nothing stopping India from doing oil business with Iran. It is another thing that the US sanctions curtailing Iran's access to global banking systems may impose practical difficulties in importing. But that should not force a change in stance rooted in principle. A two-pronged approach — wherein India would insist on its right to import Iranian oil, while quietly working to augment supplies from other countries — is the most sensible strategy. In this, the country is thankfully not alone: Unilateral US and EU sanctions against Iran have not found favour with China, Russia or Brazil either.

The above approach is also consistent with the need for more credible evidence of Iran pursuing a nuclear weapons programme or sponsoring international terrorism. The US claims about Iran's direct involvement in recent attacks on Israeli diplomats in India and Georgia are as nebulous as attributing the 2011 Mumbai blasts to some amorphous ‘non-state actors' in Pakistan. The US cannot have two different standards for Iran and Pakistan, and expect India to still toe its line. Right now, it would seem that oil importers like India are paying a premium largely for western security concerns.

Published on May 09, 2012

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