WASHINGTON– The United States has announced that it will revoke the sanctions waiver granted to India in 2018 for its operations at Iran’s strategic Chabahar Port, a decision that could complicate New Delhi’s ambitions to develop the key terminal and expand its regional connectivity.
According to US media reports, the waiver will officially expire on September 29, 2025, as part of Washington’s ongoing “maximum pressure” campaign against Tehran.
The exemption, first issued under the Iran Freedom and Counter-Proliferation Act (IFCA), allowed India and other countries to carry out work at Chabahar without being penalized. For India, the port has been vital as it offers direct trade access to Afghanistan and Central Asia while bypassing Pakistan.
In a statement released on September 16, the US State Department said the decision was “consistent with President Trump’s maximum pressure policy to isolate the Iranian regime.” It further cautioned that “once the revocation is effective, persons who operate the Chabahar Port or engage in other activities described in IFCA may expose themselves to sanctions.”
Washington underlined that the move was part of broader efforts to dismantle “illicit financial networks that sustain the Iranian regime and its military activities.”
India’s Strategic Stakes at Risk
The revocation of the waiver places India in a difficult position, particularly after it signed a 10-year agreement on May 13, 2024, with Iran’s Port and Maritime Organisation to operate Chabahar. Under the deal, Indian Ports Global Limited (IPGL) pledged around $120 million in direct investment and secured an additional $250 million credit line for infrastructure upgrades.
For New Delhi, Chabahar is more than just a commercial venture. The project was first proposed in 2003 as part of India’s vision to access Afghanistan and Central Asia without relying on Pakistan. The port also plays a key role in the International North-South Transport Corridor (INSTC), a trade route connecting India with Russia and Europe. It has already been used to transport humanitarian aid, including wheat supplies, to Afghanistan.
Back in 2018, India had managed to secure a special exemption from US sanctions underlining the port’s importance to Afghanistan’s stability. That space is now narrowing with Washington’s new stance.
A Balancing Act for New Delhi
The timing of the US decision is delicate. India is working to balance ties with both Washington and Tehran, while also maintaining close relations with Israel and Gulf partners. Losing operational room in Chabahar could undercut India’s leverage at a time when China is expanding its presence in the Arabian Sea.
Chabahar’s location, just 140 kilometers from Pakistan’s Gwadar Port — operated by Beijing — makes it a cornerstone of India’s regional strategy to counter Chinese influence.
With the waiver revoked, India faces tough questions: how to shield its investments and companies engaged in Chabahar, and whether to recalibrate its regional strategy to safeguard long-term connectivity and trade ambitions.
