One of the few areas of agreement between the Trump and Biden administrations was the so-called Economic Corridor of India-Middle East-Europe (IMEC), with the two outgoing ambassadors in India Eric Garcetti and president Donald Trump Approving the project earlier this year. These endorsements came at a time when India, a major partner of the project, was increasingly courted by countries like France,, Greeceand the United Arab Emirates To renew its efforts to make the project concretize. Although the END From the ceasefire of Gaza certainly complicates the plans for the IMEC, because it is strongly based on the use of Israeli ports, this has not dissuaded efforts In THE pass. We could easily conclude that the White House renewed commitment In the project represents business as usual for New Delhi.
However, there is a major discontinuity between the Trump administration and its predecessor, in particular with regard to regional policy: Iran. The plan of the White House to place “maximum pressure“On Iran, contrasts strongly with the Biden administration. Such a strategy has seen the Trump administration air strikes Against the Houthis, despite the ceasefire at the time in Gaza, and threatens to revoke the derogations from Iranian sanctions, including those of the Indian port to Chabahar. This change of policy considerably changes the regional commercial ambitions of New Delhi: while India had a certain latitude to choose commercial strategies without having to break directly with the American agenda, the current Washington policy, whether intentionally or not, seems to restrict this freedom considerably. Such a restriction can very well prove to be an obstacle to good relations between New Delhi and Washington at a time when India is crucial for the United States strategy to counter China.
Red Sea
The Red Sea and the Gulf of Aden are essential for India to reach European markets, a priority reflected in India’s defense policy. In 2023 and 2024, no country has been visited more often by Indian naval ships that OmanWith ships that frequently make calls in ports en route to patrol the Gulf of Aden and the Red Sea. Any disruption of this access would considerably reduce the ability of India to access sea roads to the west and give it much less latitude in its choice of commercial connections.
This is, in fact, exactly what happened last year, when India had to blur To replace its sources of Raw russian Due to disruption in the Red Sea, a shock that has contributed to a decrease in oil exportsAlso. Like the The largest exporter gross to India, access from Russia to Indian markets (generally via the Red Sea) is essential to the health of the Indian economy. The restriction of this access could have serious consequences for New Delhi.
However, such a restriction seems to be the result of the maximum pressure policy. The policy of modifying the current administration in the sanctions has increased tensions with the Houthis. In the days following their entry into office, the administration redrawn the Houthis a terrorist organization and the Treasury Department began targeting Some of the Houthi revenue reduction networks. In a way, Washington’s decision to launch air strikes against Houthis last week (and the equally aggressive response of Sanaa) represented a increase In the tensions that have been preparing since January. Although the status quo ante was barely perfect, there is evidence that he had a modest impact on shipping to the Red Sea. Shipping volumes during the ceasefire compared to the same period last year had increased somewhat, and the average cost of shipping in the world had decreased in the months which followed the implementation of the ceasefire.
An escalation in regional conflicts will have two effects for India. The first, mentioned above, is the restriction of commercial access via the Red Sea, in particular in Russian crude, which Moscow prefers to pass through the Bab El-Mandeb. This could lead to New Delhi in the arms of CCG members, just as he did last yearWhile looking for new sources to replace Russia.
The second impact concerns the IMEC itself. In the past, paradoxically, the beginning of hostilities in the Red Sea, despite the accompanying fights in Gaza, in fact increase The use of transarabian shipping routes, such as Imec, in order to bypass the uncertainty caused by the Houthi strike campaign. We can review it to happen again; At the very least, uncertainty will probably motivate India to continue the IMEC as a viable alternative.
The end result of the two impacts therefore remains the same: India is encouraged to work more closely with the Gulf States, in particular with regard to trade. It should be noted that this is not the proposed intention of Washington, but it is closely with its ardent support for the IMEC.
As long as India does not play a role in the security of the Red Sea, New Delhi’s ability to defend its commercial interests vis-à-vis the Houthi conflict is limited. An obvious solution is that India could play a more active role in the security of the Red Sea. The idea is not terribly eccentric. IMEC partners France And GreeceThe two sent naval assets to the Red Sea, have cooperated with India on naval security in the region and approved The presence of India in the Red Sea, respectively. It is positive reports With the Iranian navy, which frequently operates in the region, positions New Delhi well to act as guarantor of peace in the conflict. Far from placing maximum unilateral pressure on Iran and encourage the creation of the IMEC, Washington can obtain the exact opposite result: India’s incentive to continue its own safety interests in the Red Sea and the fortification of an alternative trade route to the IMEC.
Iranian tray
Access to the Iranian set has been, for 20 years, a key concern of India with regard to its plans for the International Corridor of North-South Transport (INSC). Last year, New Delhi made a substantial step towards the realization of this project when it sign A 10-year rental agreement with Tehran for the port of Chabahar, in the extreme south-east of the country. Although the project is much more emerging than the historical dependence of India in the Red Sea, the INSTC has a certain promise, in particular with regard to Russia. Trade between the two along the corridor double in 2024, demonstrating that the corridor could Become a viable and resistant link to sanctions with Russia. The two even experienced the use of the route as a energy corridorhelping to alleviate the dependence of the two countries in the Red Sea.
To this end, the restriction of access to the INSTC, without having the same serious economic consequences as the disturbances of the Red Sea could prevent India from diversifying the first, aggravating the impacts that the disturbances could have first. Just as before, however, such a restriction seems to be the objective of the maximum pressure policy.
The most obvious means that it has manifested was the deletion of an exemption that India had for its investments in the port of Chabahar. Even if this renunciation is reinstated, however, Washington’s policy also threatens the other parts of the route. Take, for example, the Astara-Rasht line, a critical part of the INSTC in Iran whose construction plans are finalized with Azerbaijan And Russia. In the absence of a renunciation of sanctions, external actors and India will have a limited role in the possibility of developing the line, to say nothing if the US Treasury Department will place sanctions in Azerbaijan and Russia if they continue their financing plans for the project. More generally, infrastructure improvements like these are essential to the success of the INSTC, and yet investing in such improvements becomes very uncertain under a maximum pressure diet.
Similar to the Red Sea, the alternative to the INC is IMEC. It is hardly a new development either. Faced with uncertainty for the INSTC in the middle of the Armenia-Azerbaijan conflict in September 2023, New Delhi look in Imec as a viable alternative. It is only the subsequent attacks of Hamas in the south of Israel a month later, which really tempered the determination of India on this issue. Given the recent rhetoric of India, in particular towards the partners of the IMEC such as the United States, France and Greece, this seems to be the management that India is currently evolving on the issue.
The vulnerability of India, however, should not be confused with the abandonment of the INSTC project. Just like with sanctions against Russia, there is bypassTo a certain extent, that India can count to transit goods via the INSTC. The result of Washington’s policy here is the same as before: rather than its unilateral isolation of Tehran and the development of the IMEC, the end result can be the preservation of the regime’s economic lines of life and the growth of a competitor to the IMEC, the INSTC.
Conclusion
The interaction of the IMEC with Washington’s modified policy concerning Iran creates compromise for New Delhi between cooperation with the United States and its partners of the IMEC, on the one hand, and a more unilateral prosecution of its commercial interests in the Red Sea and the Iranian plateau, on the other hand. It is not historically compromise that India estimated that it should do; The previous exemption for Chabahar demonstrates it.
By limiting New Delhi’s ability to continue and protect his commercial interests, Washington takes a risky path. Not only do the United States want to cooperate with New Delhi on a multitude of other problems, but that emphasizes New Delhi’s interests at a time when it considers India as more and more critical in competition against China. Trump administration pricing will only add to the pressure on New Delhi. These policies may well see India adopt a more unilateral approach in the future.
Beyond China, a softening of the United States’s approach to India’s interests can have training effects for other important foreign policy initiatives, including its peace talks with Russia. If the objective of the Trump administration is to peel Russia far from the Chinese orbit, insulating Moscow from India, a major economic partnerseems to work for crossed ends with this end. Far from advancing the same policy as the previous administration, there is a persuasive argument according to which a recalibration of the policy of sanctions from the current administration towards Tehran could be a carrot in negotiations with Putin.
Although the relationship between the Trump and New Delhi administration has not yet been fully chopped, the current status quo does not seem to be sustainable. For its part, India obtains, more or less, the same agreement with the current administration as with the previous one, although a much higher cost. The Trump administration, in turn, could end up more than asking when India reacted to this state of affairs. A realignment of the relationship seems almost inevitable.