• The US has issued a warning about potential sanctions for any country considering business deals with Iran.
• India signed a 10-year contract to operate a port with Iran, marking a “historic moment in India-Iran ties.”
• Experts anticipate that the deal will pave the way for larger investments in the port.

Hours after India signed a 10-year contract to operate a port with Tehran, the US has issued a warning of potential sanctions for any country considering business deals with Iran. India had initiated an agreement in 2016 to develop the strategically important Chabahar port, situated close to Iran’s border with Pakistan.

On Monday, India signed a long-term deal with Iran to further develop the Chabahar port. India’s shipping minister hailed it as a “historic moment in India-Iran ties”. However, the move may not receive approval from the US, which has imposed more than 600 sanctions on Iranian-related entities over the past three years.

During a press briefing on Tuesday, Vedant Patel, the State Department Deputy Spokesperson, stated in response to questions about the deal that the US sanctions on Iran remain in place, and Washington would continue to enforce them.

“Any entity, anyone considering business deals with Iran – they need to be aware of the potential risks that they are opening themselves up to and the potential risk of sanctions,” he said.

India has not yet responded to the statement.

At the end of 2018, India assumed operations of the port. The port has opened a transit route for Indian goods and products to Afghanistan and Central Asia, bypassing the land route through Pakistan – two neighbors with a tense relationship, India and Pakistan.

Officials report that so far, they have shipped 2.5 million tonnes of wheat and 2,000 tonnes of pulses from India to Afghanistan through the Chabahar port.

On Monday, India’s shipping ministry announced that the Indian Ports Global Limited (IPGL) and the Port & Maritime Organisation of Iran had signed a long-term deal for the development of the port.

Iran’s Minister of Roads and Urban Development Mehrdad Bazrpash stated that under the agreement, IPGL would invest approximately $120 million with an additional $250 million in financing, bringing the contract’s value to $370 million.

India’s Foreign Minister S Jaishankar expressed that the deal “will clear the pathway for bigger investments to be made in the port”.

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