Geopolitical Lessons from the Iran Conflict

Context

The Iran issue, in recent years, has introduced new scenarios and challenges to the international geopolitical landscape, impacting India in a significant manner in terms of energy security, strategic autonomy, and foreign policy.

Key Highlights

• The Iran issue has had significant impacts on the geopolitical and geoeconomic context of West Asia in recent years.
• While the conflict has abated in recent weeks, it has also revealed certain weaknesses in energy supply chains and international security systems.
• India has almost 85% of its crude oil needs met through imports, thus making the developments in the Gulf region a direct influence on India’s economy, security and stability.

Declining Confidence in the United States as a Security Guarantor

Key Developments

• The war brought up issues about the United States’ strategic goals.
• Missile and drone attacks hit several Gulf countries, including those where US troops are stationed.
• There is growing uncertainty among Gulf partners about US security commitments.

Implications for India

• Opens doors for India to further develop defence relations with Gulf nations.
• Increases the opportunities for indigenization in the defence sector in the context of ‘Atmanirbhar Bharat’.
• Contributes to India’s goals of being a trusted security partner to the IOR.

Strategic Importance of Choke Points

Strait of Hormuz

• The Strait of Hormuz is used by approximately 20% of all crude oil exported worldwide.
• The disruption of maritime traffic for any length of time in Iran has shown that oil prices can immediately rise.
• The oil price briefly jumped from around $75 to $126 per barrel, impacting importing economies.

Lessons for India

• Expand Strategic Petroleum Reserve (SPR) holding capacity beyond the current small storage.
• Expand the variety of crude oil supply sources.
• Improve the security of the maritime domain in the context of India’s MAHASAGAR vision.
• Establish other routes of supply and logistics.

Weakening Influence of OPEC

Emerging Trends

• The war revealed the ineffectiveness of OPEC in regulating global oil prices.
• Price increases were tempered by higher production from non-OPEC oil producers and oil releases from the strategic oil reserves.
• This decline in oil imports by China also had an impact on global demand.

Significance for India

• Increased opportunities for diversified energy relationships.
• Improved bargaining power while negotiating long-term crude oil contracts.
• Increased importance of renewable energy and energy transition policies.

Re-emergence of Iran as a Pragmatic Regional Power

Emerging Political Trends

• Iran seems to be on the path to becoming more pragmatic and development-oriented.
• Economic recovery and regional stability are becoming more of a priority.

Importance for India

• Expand bilateral cooperation and connectivity and deepen trade and energy relations.
• Rejuvenate strategic projects such as Chabahar Port.
• Invest in the International North-South Transport Corridor (INSTC).
• Ensure a long-term and diversified energy supply.

Relevance for India

• Energy Security

  • Diversification of crude oil imports.
  • Development of strategic oil reserves.
  • Promotion of renewable energy.

• National Security

  • Enhanced level of surveillance of the Arabian Sea.
  • Enhanced naval preparedness.
  • Safety of Sea Lines of Communications (SLOCs).

• Foreign Policy

  • Continue strategic autonomy.
  • Keep a balance in engagement with Iran, Gulf countries, Israel and the United States.
  • Enhance India’s influence in the diplomacy of the West Asian countries.

Way Forward

• To increase the Strategic Petroleum Reserve to 30–60 days of crude oil imports.
• Promote renewable energy and green hydrogen projects.
• Increase sourcing of crude oil from West Asia, Africa, Latin America and Russia.
• Improve maritime security with SAGAR/MAHASAGAR programs.
• Improve export of defence products and strategic cooperation with Gulf countries.
• Expand economic and connectivity cooperation with Iran while taking into account broader geopolitical considerations.

Conclusion

• The Iran conflict has led to a realization of geopolitical risks that are not just related to the military aspect of conflicts but also energy supply chains, maritime choke points and economic resilience.
• The lessons for India are clear: increase energy security, diversify strategic partners, build up capabilities in the maritime domain and ensure strategic autonomy.
• A multi-aligned and balanced foreign policy, which will have to be supported by resilient energy and security infrastructure, will continue to be central to protecting India’s long-term national interests.

Source: The Indian Express

Mains PYQ

Q. “Access to affordable, reliable, sustainable and modern energy is the sine qua non to achieve Sustainable Development Goals (SDGs)”.Commenton the progress made in India in this regard. (2018)

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