One of the most difficult tasks facing the foreign policy makers in India is the requirement to balance the relations with Iran while enhancing proximity with the United States. This invariably raises questions over the importance of Iran. An ancient civilisation, Iran is located at the crucial junction of South Asia and the Middle East. It also links the Central Asian Republics and the Caucasus region to the Arabian Sea. Historically, it has influenced its neighbours, irrespective of the type of government in power. One of the oldest continuously inhabited civilisations, it forms a bridge between the Semitic world and the Indo-Aryan civilisation of South Asia and has had strong historical linkages with India. This article looks at the strategic importance of Iran for India.