US warns India of ‘sanctions’ over port deal with Iran

US warns India of ‘sanctions’ over port deal with Iran

Washington: United States State Department has warned India with potential risk of sanctions after it inked a 10-year deal with Iran, taking over operations at the Chabahar port.

In a press briefing in Washington on Monday, State Department Spokesperson Vedant Patel said: “... any entity, anyone considering business deals with Iran, they need to be aware of the potential risk that they are opening themselves up to and the potential risk of sanctions.”

He reiterated that the US’s sanctions on Iran remain in place and Washington will “continue to enforce them”.

Patel maintained that the risk of sanctions also applies on Indian firms.

The State Department's statement comes after India and Iran signed a 10-year contract to develop and equip the strategic Chabahar port in Iran on Monday.

The contract will in turn see India Ports Global Limited (IPGL) invest $370 million into “providing strategic equipment” and “developing the transport infrastructure of the port”.

In 2016, India agreed to finance the development of the Iranian port as a trading hub for central Asia as Prime Minister Narendra Modi sought to revive economic ties with Tehran after the lifting of sanctions.

Modi and former Iranian president Hassan Rouhani oversaw the signing of a memorandum of understanding for the provision of a line of credit from India’s EXIM Bank to develop the port.