U.S. Lifts Sanctions on Iran’s Chabahar Port Following India’s Strong Appeal

Washington/New Delhi: In a significant diplomatic breakthrough, the United States has agreed to withdraw sanctions imposed on Iran’s Chabahar Port following India’s strong appeal. The port, developed and operated with substantial Indian investment, is a critical strategic asset for India’s regional trade and connectivity initiatives.

Earlier this year, Washington extended its sanctions on Iran to include Chabahar — a move that dealt a major setback to India’s operations there. The decision had raised concerns that India might have to suspend port activities altogether. However, after sustained diplomatic engagement, the U.S. has now granted a temporary waiver, effective until early next year.

New Delhi had urged Washington to reconsider its decision, citing the port’s vital role in facilitating humanitarian supplies, including medicines, to Afghanistan. India also emphasized that Chabahar serves as its only direct access route to Afghanistan, bypassing Pakistan. The port further enables smooth trade with Iran, Russia, and Central Asian nations such as Kazakhstan, Tajikistan, and Uzbekistan — as well as cargo movement to Europe.

The Chabahar Port, located in Iran’s Sistan-Baluchestan province along the Gulf of Oman, holds immense geopolitical importance. In 2016, during Prime Minister Narendra Modi’s visit to Tehran, India, Iran, and Afghanistan signed the landmark Chabahar Trilateral Agreement, paving the way for the port’s development as part of the International North-South Transport Corridor (INSTC). India later took operational control of the Shahid Beheshti terminal through India Ports Global Limited (IPGL) in 2018.

Under a 10-year agreement signed in 2014, India committed an investment of USD 120 million for port development and extended an additional USD 250 million in credit for associated infrastructure projects. For 2024–25, New Delhi further allocated ₹100 crore in funding to enhance the port’s capacity and efficiency.

India’s long-term goal is to expand Chabahar’s handling capacity from the current 100,000 TEUs (twenty-foot equivalent units) to 500,000 TEUs by upgrading port infrastructure. Simultaneously, a 700-kilometre railway line connecting Chabahar to Iran’s central regions is under construction, expected to be completed by mid-2026.

Strategically, Chabahar offers India a counterbalance to China’s growing presence in the Arabian Sea through its control of Pakistan’s Gwadar Port — located just 140 kilometres away. The U.S. decision to lift sanctions thus marks a diplomatic relief for New Delhi, restoring India’s operational advantage in the region.

Had the sanctions persisted, Pakistan would have gained a significant logistical edge in regional trade. The renewed waiver not only safeguards India’s strategic investments but also reinforces Chabahar’s role as a crucial gateway for regional connectivity and humanitarian access.