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Engaging Iran: Opportunities and Challenges for India

August 6, 2009

A round table on “Engaging Iran: Opportunities and Challenges for India” was organized by the Institute for Defence Studies and Analyses on August 6, 2009 against the background of the recent visit by an IDSA delegation to Tehran. The main focus of the discussion was on recent developments in Iran, and how the new government under re-elected President Ahmadinejad will open opportunities and challenges for India. The discussion also looked at how much of substance India and Iran have been able to put into their strategic partnership launched in 2003. Director General IDSA initiated the talk with a brief description of the Iranian perception of India’s policy towards Iran. The round table discussed the following questions:

What are the political trends in post-election Iran?
Where does India figure in Iran’s foreign policy priority?
What is the current status of India-Iran relations?
What are the problem areas between India and Iran?
How should India meet Iran’s concerns?
What should be India’s policy towards Iran?

There was a common consensus that Iran is an important regional player and that India needs to engage it. However, views differed on the question of how to engage Iran.

The observations and comments during the round table can be summarized as under:

Iranian Perspective about India-Iran Relations

The IDSA delegation noted that Iranians gave adequate signals that though bilateral relations are normal, they cannot be termed as excellent. India should spell out its foreign policy aims and objectives towards Iran. For excellent relations the Iranians expect India to come out with a clear stand on Iran. It was pointed out that the Indian Prime Minister ignored Iran during his visit to Qatar.
Cooperation in defence and security issues is insignificant. Most of the MoUs signed are not implemented. Iran wants to cooperate in high-technology areas with India. Though economic ties are continuing between the two countries, this does not reflect the real potential of both countries.
If both countries can define a new mechanism of cooperation then relations can improve. It was suggested that bilateral relations can be taken from the normal to the strategic level. India is missing the bus while the Chinese are at the forefront.
Iranian officials were of the view that the deadlock in international relations is because of the unilateral approach of one particular country, and that ‘Asian Integration’ was the way to solve these problems. ‘Collective regionalism’ could be a possibility. In fact, the formation of the ‘Asian and Regional Security Structure’ would help solve security issues and will help enhance cooperation in energy and transportation sectors, thus creating a favourable environment for regional economic cooperation.
The IDSA delegation was informed that there is a need for more dialogue between the two countries. It was suggested that there should be two bilateral dialogues in a year to fill the communication gap between India and Iran and to evolve new mechanisms of cooperation to take bilateral relations to new levels.
Iranians think that the West, particularly the US, is influencing India’s Iran policy. They are of the view that the Indian government does not follow an independent foreign policy. Most of the time it appears to be working at the behest of the US. This is even visible in private companies’ behviours. For instance, Tata and Reliance are not doing fairly enough in building the two countries’ economic relations.
Four factors were identified for strengthening Indo-Iran cooperation – introduction of new ideas, focus on Asian identity, intention for future cooperation, and implementation of various agreements signed between the two countries.

Internal situation in Iran

On the surface the political situation looks very normal, though there seems to be a clear divide within the Establishment. The recent election has clearly revealed the growing opposition to the Ulema in Iran. There were several modes and forms of resentment against the leaders. Iranian society is passing through a phase of obvious dissent.
The dissent against the election result was there, but it was limited in terms of class and section of population as well as areas too. It was elitist in nature, led by the middle class, students and women. The protests were confined mainly to select urban areas, though there were exceptions like Tabriz, Mashad, etc. There was no evidence of resistance in rural areas. Only some Western media are telecasting and writing about this.
Ahmednejad has taken care of the basic needs of the people, particularly in the rural areas. Hence, this has also worked as a breakwater for the movement against the newly elected government.
The Urban educated youth have become restive; they are interested in exploring career opportunities in Western countries. Good employment opportunities seem to be lacking and this might be the effect of Western sanctions. This section does not want Iran to be misrepresented in the US, the West and the world.
While Iran puts up a face that its economy is doing better, it is evident that sanctions are having an adverse impact.

Iran’s foreign policy priority and India

It was articulated that Iran will perhaps continue its past foreign policy where the priority would be to enhance relations with Islamic countries and countries in the region. India would figure as an important country with which Iran would like to have close relations because of India’s past relations with Iran and its regional power status and potential to play an important role in the region.
The physical presence of China is noticeable in the Iranian metro, hotels, and in the oil and gas sector. The Chinese have shown a lot of interest in Iran. One of the countries which has pursued a long term policy vis-à-vis Iran is China. Even the Russians seem to be pursuing a short term policy approach towards Iran, and sometimes Russian policy becomes ambiguous.
It is quite visible that the Chinese are receiving high priority in the Iranian foreign policy agenda. The reasons are perhaps, that China is a member of the UN Security Council, and the Chinese presence in the region is obvious be it in Afghanistan, Pakistan or other Middle Eastern countries.
Iran’s relations with the US are expected to be mixed. One does not see a very robust Iranian response to Obama’s offer. It is visible that despite sanctions, Iran has persisted with its nuclear programme, particularly the Heavy Water Reactor at Arrakk, and human resources are being trained in Germany. The upper Middle class hopes to replace the present regime and alter its policy with respect to the US, though Iran wants all these to happen on its own terms.
Iran notes that growing stability in Iraq and Afghanistan is because of its cooperation. Iran hosts one million Afghanis as refugees. This has created a major law and order problem in the region; the menace of drug trafficking and arms proliferation are other related issues with Afghan refugees. These are Iran’s priority in dealing with the situation among its immediate neighbours.

Engaging Iran: Problems and prospects

Some participants in the Round Table were of the opinion that Iran has been neglected by India and that India lacks an independent and intelligent policy towards Iran. Iran is quite missing in India’s diplomatic maneuverings. There exists a huge “trust deficit” between the two countries. President Khatami’s 2003 visit to India as Chief Guest was the high point in India’s diplomatic relations with Iran. Today it is important to examine the fault lines of India’s policy towards Iran.
Other speakers were of the view that bilateral relations cannot be a one way traffic, with India supporting Iran all the time. Iran will also have to take into account India’s concerns and act accordingly. The question whether Iran has given even token support to India on the Kashmir issue against Pakistan was posed. It was pointed out that Iran has never supported India in OIC. It has always supported Pakistan. Thus, there is a need for reciprocity.
Iran views India’s lukewarm response in defence cooperation as caused by the Israeli factor. It was pointed out that these two issues could be treated separately.
Another issue that was deliberated upon was Iranian views on the Indian Prime Minister’s visit to Oman and Qatar, the signing of defence pacts as well as the general coming closer of India and GCC at Iran’s cost. Iran does not accept the view that its nuclear programme is threatening to Saudi Arabia and Qatar, and views increasing Indo-GCC relations as having a negative effect on Indo-Iranian relations.
The ambiguity of the power hierarchy in Iran’s political structure makes it difficult to judge which is the nodal agency when it comes to addressing various issues and mutually acceptable solutions to bilateral matters.
India does not have regular and stable source of information agencies in the Gulf countries including Iran. Therefore it has to mostly depend on third country’s news agencies. Sometime it takes help from London-based agencies to understand Iran. This creates a communication gap between the two countries.
It was reiterated that Iran’s resurgence cannot be taken lightly. Its rise and growth as a regional power is certain, and thus it is high time India develops a pragmatic, long term and balanced foreign policy towards Iran.
Iran is important for India in a number of fields such as energy, trade, transport corridor, containing Taliban in Afghanistan, as well gaining some leverage vis-à-vis the Shia population within India as well as where they are in sizeable number, including in Pakistan.

Recommendations

This is the right time for India to clearly spell out its bilateral issues and policies particularly on Afghanistan, transport corridor and gas pipeline. Iran is important particularly in dealing with the large Shia population within India, and with the Muslim world. India has some domestic leverage which it can use as inputs to improve and revitalize its relations with Iran. The presence of the second largest Shia population (25 million) in India can be a factor to take further this relationship.
There is need to explain what India’s national interests are and that India’s increasing relations with the West and particularly with the US is not at the cost of its relations with Iran. New Delhi needs to evolve a policy to engage Iran without antagonizing the US.
India-Iran relations should be articulated and viewed in a historical perspective. One cannot always speak the language of the market, energy, trade, corridor, etc., but should take into account relations on the civilizational plane. Both countries have very deep and longstanding relations right from Indus and Persian times. It was argued that the moment the Cold War ended India lost its sense of balance vis-à-vis Muslim countries.
The international and regional situations have changed and therefore it is desirable to change policies accordingly. One should not carry through the Cold War mentality but judge issues on the basis of expediency and national interest under the prevailing situation, keeping long term interests in view.
India can take the initiative and host a dialogue of regional powers including Iran, Israel, GCC, Pakistan, US, Afghanistan, and discuss and deliberate upon sensitive issues. It is high time for such a diplomatic overture.
It was argued that there is no conflict on the nuclear issue. India needs to downplay this issue and engage Iran rather than being hawkish. Overemphasis of the nuclear issue provides an opportunity to various factions within Iran to develop different policy perspective with regards to India.
Measures which could be helpful in mending as well as enhancing India-Iran relations are:
- Reciprocal visits are needed at a high level and the frequency should be increased.
- A clear message should go to the private sector about policy with respect to Iran. Iran should clearly spell out its foreign investment policy for Indian companies. It must understand that Indian companies do business based on purely economic considerations.
- Ensure a well developed staff in the Indian embassy with knowledge of regional languages. This will serve as an advantage when it comes to dealing with empathy with Iran’s culture and ethos.
- Progress on IPI pipeline should be made. Some concrete steps are needed in this direction.
- India can take a cue from how Japan and Italy have managed and built close relations with Iran despite being US allies.
- Create Indian information agencies in West Asian countries. This will enable India to formulate its foreign policy on the basis of regular information and news.