Why India Is Courting Iran

Earlier this year, Brazil and Turkey infuriated the Obama administration when they announced just ahead of a critical United Nations vote on sanctions against Iran that they had brokered a deal to reprocess Iran's low-enriched uranium. To Washington, it looked like a throwback to the bad old days of the nonaligned movement: two big developing nations trying to burnish their anti-Western credentials at the expense of nuclear nonproliferation. They even thumbed their noses at the West by voting no on the new sanctions. Now many are wondering if India will be the next to break ranks on Iran.

After Obama signed a tough new unilateral sanctions law against Iran last month, India's top diplomat, Nirupama Rao, complained that these sorts of initiatives could have "a direct and adverse impact on Indian companies and, more importantly, on our energy security and our attempts to meet the development needs of our people." New Delhi continues to voice support for Iran's right to civil nuclear energy, and officials publicly say they do not think sanctions are the best way to persuade Iran to give up its clandestine nuclear-weapons program. Instead, New Delhi has urged negotiations between the West and Tehran.

India has enjoyed close relations with Iran ever since Iran was Persia and India was ruled by the Mughal dynasty. But in recent years, India has been looking to deepen its ties to Tehran for two reasons. First, India's economic boom—growth that it is counting on to lift hundreds of millions of its people out of poverty—requires energy, and Iran currently supplies about 15 percent of India's oil imports, a figure set to grow markedly in the next five years as India pushes ahead with plans to substantially boost its refinery capacity for Mideast crude. In the past year, Hindustan Petroleum Corp., India's state-owned oil company, has tripled the amount of Iranian oil it imports. India also wants to purchase Iranian natural gas and has invested heavily to help Iran develop its gas fields, as well as to upgrade the port facilities at Chabahar on the Gulf of Oman—the nearest point for shipping oil and gas to India.

Second, India sees Tehran as a potential partner in Afghanistan. With the likelihood in-creasing that NATO will withdraw without decisively defeating the Taliban, New Delhi wants to prevent Afghanistan from becoming a Pakistani proxy state. Tehran could help. During Afghanistan's civil war, Tehran supported the ethnic Hazaras—who are Shiite Muslims—against the Pashtun Taliban, Sunnis backed by Pakistan. India, meanwhile, funded ethnic Uzbek and Tajik warlords. New Delhi may seek to create an alliance of these non-Pashtun groups in Afghanistan to thwart Islamabad's designs on Kabul. What's more, India needs to maintain good relations with Tehran so that it can continue to send equipment and supplies for its aid mission in Afghanistan through Iran, since Pakistan will not permit Indian aid to pass through the country.

India's strategic pursuit of closer ties to Iran has hit a major stumbling block in the form of Tehran's nuclear program. To maintain critical ties with the West, it has voted against Iran twice at the International Atomic Energy Agency. Rao, the foreign secretary, has promised that India will comply with all U.N. sanctions on Iran, even though they specifically target a 35-year-old Iran-India shipping joint venture whose eight tankers bring Iranian crude to India. This company, Irano Hind, would be put out of business, and dozens of others could find themselves cut off from international financial markets if they continue to trade with Iran.

To thread this needle, India may try to stall. It could mount legal challenges to the West's new unilateral sanctions. But if pressed by Washington and Brussels, New Delhi will likely acquiesce. It is unlikely to follow the lead of Brazil and Turkey and cast a "no" against efforts short of war to compel Iranian compliance with the Nuclear Non-Proliferation Treaty. After all, India craves international recognition and influence as a world power. It took a major step toward that goal with the 2005 U.S.-India Civil Nuclear Agreement, which essentially recognized India as a legitimate nuclear-weapons state. It does not want to sully that by aligning itself with a nuclear pariah like Iran.

India also has its heart set on another trophy—a permanent seat on the U.N. Security Council. It is unlikely to get that if it undermines U.S. and EU policy on Iran. India can obtain fossil fuel from lots of places. But there's only one place they are handing out permanent seats to the Security Council, and it's not Tehran.

Kahn is a NEWSWEEK contributor based in New Delhi.