New Delhi abandons project after US imposed 25% tariff on countries doing business with Tehran
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The Indian government, led by Prime Minister Narendra Modi, has come under heavy fire at home after it withdrew from the Chabahar port agreement with Iran, with critics arguing the move was a strategic retreat rather than a proactive foreign policy decision.
New Delhi was forced to abandon its involvement in the port after the United States imposed a 25% tariff on countries doing business with Tehran, The Economic Times reported on Thursday.
According to the publication, India’s withdrawal was carried out without any formal announcement, resulting in the loss of $120 million already paid to Iran.
The amount had been transferred before the decision to disengage and is now considered unrecoverable, the report stated.
The state-run company working at the port, India Ports Global Limited (IPGL), saw its board of directors submit collective resignations after the decision, while the company’s official website has also been shut down.
Congress party leader Pawan Khera termed the move “a new low” in the Modi-led government’s foreign policy.
“So the question is not of Chabahar Port or of Russian oil. The question is: Why is Modi allowing USA to arm-twist India?” he asked in an X post.
India assumed responsibility in 2024 for developing Chabahar port under a 10-year arrangement with Iran.
Meanwhile, a foreign journal reported that the $120 million already paid to Iran can now be used by it at its discretion for the port’s construction and development.
Observers described India’s withdrawal from Chabahar port as another major setback for New Delhi.
The Congress party sharply criticised the Modi-led government over the decision, saying the Indian prime minister “has once again surrendered to Trump”.
