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The relationship between Saudi Arabia and Iran has never been more prudent. The well-known rivalry between both countries dates back to the pre-revolutionary era of Iran. Iran, a Shia state, and Saudi Arabia, a Sunni-Wahhabi state, have competing claims to leadership over other Islamic countries in West Asia. These two nations hold divergent ideological and political positions, which has led to multiple conflicts of interest, as evident from their proxy wars in Yemen and Syria. Beyond these divergences, both seek to be the dominant powers in West Asia, influenced by a combination of factors. This includes the protection of respective national interests and resources, security concerns, and the economy.
After seven long years of hostilities, Iran and Saudi Arabia agreed to re-establish diplomatic relations in a peace deal brokered by China. Efforts are underway to strengthen bilateral relations through the reopening of embassies and missions. The revival of key agreements on security cooperation signed in 2001 and the 1998 pact on trade, investment, technology, and culture are also on the agenda. Saudi Arabia is seeking to recalibrate its foreign policy, while Iran is hoping for the alleviation of some of its economic and geopolitical challenges, which has led them to agree to the deal. Enhanced communication between the two countries will mitigate the risk of confrontation. But it will take time to assess whether all issues have genuinely been resolved.
The deal between Saudi Arabia and Iran carries significant implications from an Indian perspective. While India has had longstanding ties with both countries, it has also encountered troubled waters due to regional conflicts. From the Saudi oil refinery attacks inadvertently affecting India’s energy market to the evacuation of the Indian diaspora from Yemen under Operation Rahat, the stability and peace between Saudi Arabia and Iran have a significant stake for India. It is critical, however, to assess the implications of this deal on India through a certain lens surrounding its energy, geopolitics, and security implications.
Energy plays a crucial role in international relations and, more specifically, in West Asia due to its abundant oil and gas reserves, which supply energy in the form of crude oil and natural gas to nations worldwide. The region accounts for 31.3 percent of global oil production, making it a significant player in global energy markets. India imports more than 18 percent of its oil from Saudi Arabia alone, coming up to about 0.67 million barrels per day. It is noteworthy to highlight that the import of oil from Iran came to a complete halt as a result of economic sanctions imposed by the United States in 2019. Before the sanctions, India held the position of being the second-largest importer of Iranian oil, importing approximately 620,000 barrels per day. Given India’s high dependence on energy imports from West Asia and its prior experience with disruptions caused by the attack on the Saudi refinery, ensuring regional stability becomes crucial for India’s uninterrupted oil supply.
Considering the geopolitical dimension, India maintains strong diplomatic ties with countries such as Iran, Saudi Arabia, the United Arab Emirates, and other nations in the Gulf region. Iran is a vital gateway for India to Central Asia, and the development of the Chabahar Port further cemented the relationship between the two countries. Earlier, India had to carefully navigate and maintain diplomatic ties with both countries while avoiding being drawn into their conflicts. Balancing these relationships posed challenges for India while keeping itself neutral and at the same time looking out for its national interests. The new deal will make things a lot easier for India. It has motivated India to engage in dialogue with Iranian officials, as evidenced by the visit of India’s National Security Advisor, Ajit Doval, to Tehran.
From a security standpoint, the reconciliation would contribute to the security of India’s sizable diaspora, which amounts to approximately 8.5 million individuals residing in Gulf countries. By effectively curbing the proxy conflicts waged by these two nations in the region, the deal holds the promise of reducing instances of instability that have posed threats to the safety and well-being of the Indian diaspora.
It is unlikely that the deal will have a significantly negative impact on US-India relations. Considering India’s historical non-alignment stance and prioritisation of national interests and strategic autonomy, the United States would likely view India’s efforts to maintain positive relations in the region favourably. This is particularly significant considering the growing presence of China in the region, which is a global rival of the US.
The involvement of China in brokering the deal is not a cause for concern, as it would contribute to stability and peace in the Gulf, which is ultimately advantageous for India. Despite being unable to surpass China’s role in leading the reconciliation between Iran and Saudi Arabia, India can still play a significant role in advancing the deal and fostering good relations between the two countries in the long run. However, Indian diplomacy has often been reactive to regional events, lacking proactive measures to initiate dialogue and diplomacy. While India may lag behind China in terms of developing capacities in diplomacy, international relations, foreign policy, and strategic studies, India possesses its own strength in soft power, where it outshines China. Several factors contribute to India’s significant soft power, including the historical relations between India’s western coast and the Gulf region, the influence exerted by the Indian diaspora, and India’s established track record of providing humanitarian assistance. It is crucial for India to fully leverage this soft power to advance its strategic interests and stabilise the region, which will further benefit Asia as a whole.
Views expressed by the author are personal and need not reflect or represent the views of the Centre for Public Policy Research.
Neelima completed her Post Graduation in MA Geopolitics and International Relations from Manipal Academy of Higher Education. While pursuing her masters she has done her 3 months Internship from the Middle East Institute, New Delhi. After completion of the course she worked for 2 months as IR project Intern at Centre for Public Policy Research, Kochi. She is passionate about research and writing in the field of International Relations. Her Interest areas include West Asia, Indo-pacific, Multilateralism, Global and National Security.
