REFERENCE NOTE - 164.100.47.193
Transcript of REFERENCE NOTE - 164.100.47.193
REFERENCE NOTE
No.23/RN/Ref./July/2016
For the use of Members of Parliament NOT FOR PUBLICATION1
INDIA-IRAN BILATERAL RELATIONS
Prepared by Smt. Neelam Sethi, Additional Director (23034876 ) and Shri Abhishek Thakur, SLA of Lok Sabha
Secretariat under the supervision of Smt. Kalpana Sharma, Joint Secretary and Shri C.N. Sathyanathan, Director.-
The reference material is for personal use of the Members in the discharge of their Parliamentary duties, and is not for publication. This Service is not to be quoted as the source of information as it is based on the sources indicated at the end/in the text. This Service does not accept any responsibility for the accuracy or veracity of the information or views contained in the note/collection.
MEMBERS' REFERENCE SERVICE
LARRDIS
LOK SABHA SECRETARIAT, NEW DELHI
----------------------------------------INDIA-IRAN BILATERAL RELATIONS
“My visit to Persia has given me faith in the power of the eastern peoples to assert themselves
and quickly find their way to a united manifestation of their undying heritage in spite of conflict
and difficult economic circumstance”.1
Rabindra Nath Tagore
Introduction
The peoples of India and Iran, two ancient neighboring civilizations, have enjoyed
close historical links through the ages. They had a common homeland and share a common
linguistic and racial past. Over the several millennia, they interacted and enriched each
other in the fields of language, religion, arts, culture, food and other traditions. Iran is
situated in India's extended neighborhood and the two countries have significant overlap in
their economic and security space. Today the two countries enjoy warm, friendly relations
and cooperate in a wide range of fields2.
I. Political Relations
India-Iran relations span centuries marked by meaningful interactions. The two
countries shared a border till 1947. Independent India and Iran established diplomatic links
on 15 March 1950.The Shah of Iran visited India in February/March 1956 and Prime
Minister Pandit Jawaharlal Nehru visited Iran in September 1959. Prime Minister Smt.
Indira Gandhi visited Iran in April 1974 and Prime Minister Shri Morarji Desai visited in
June 1977. The Shah, in turn, visited India in February 1978.
The Iranian Revolution in 1979 introduced a new phase of engagement between
India and Iran marked by exchange of high level visits of Indian Prime Minister Shri
Narasimha Rao in September 1993, Iranian President Akbar Hashemi Rafsanjani in April
1995 and Indian Vice President Shri K. R. Narayanan in October 1996. The trend was
1 http://www.indianembassy-tehran.ir 2 India Iran Historical Links Part I: http://www.indianembassy-tehran.ir
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consolidated and enhanced at the turn of the millennium with visits by Prime Minister Shri
Atal Behari Vajpayee in 2001 and a return visit by President Mohammad Khatami in 2003,
when he was also the Chief Guest at the Republic Day function. The Iranian President Dr.
Mahmoud Ahmadinejad visited India on 29 April 2008.
The year 2012 witnessed further strengthening of the relations between the two
countries. The Prime Minister Dr. Manmohan Singh visited Iran to attend the 16th Non-
Aligned Movement (NAM) Summit held in Tehran on 28-31 August 2012. Iran had
assumed the Presidency of NAM in 2012. On the sidelines, Hon’ble Prime Minister met
Supreme leader Ayatollah Ali Khamenei and President Dr. Mahmoud Ahmadinejad. Both
sides reviewed the entire gamut of bilateral relations and called for further strengthening
the centuries old relationship between India and Iran. Hon’ble Vice President of India Shri
M. Hamid Ansari graced the swearing-in ceremony of the newly elected Iranian President
Dr. Hassan Rouhani on 04August 2013. Hon’ble Vice President met Dr. Hassan Rouhani
and the two leaders discussed issues of mutual interest in the bilateral, regional and
international arena. Prime Minister, Shri Narendra Modi, met Iranian President Dr.
Hassan Rouhani in Ufa (Russia) on 9 July 2015.
Prime Minister Shri Narendra Modi visited Iran on 22 May 2016.
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3 http://www.indianembassy-tehran.ir/
Chronology of Indian Heads visit to Iran
1) Prime Minister Pandit Jawaharlal Nehru visited Iran in September 1959.
2) Prime Minister Smt. Indira Gandhi visited Iran in April 1974.
3) Prime Minister Shri Morarji Desai visited Iran in June 1977.
4) Indian Prime Minister Shri Narasimha Rao visited Iran in September
1993.
5) Prime Minister Shri Atal Behari Vajpayee visited Iran in 2001.
6) Prime Minister Dr. Manmohan Singh visited Iran to attend the 16th
Non-
Aligned Movement (NAM) Summit held in Tehran in August 2012.
7) Hon'ble Vice President of India Shri M.Hamid Ansari graced the swearing-
in ceremony of Iranian President Dr. Hassan Rouhani in August 2013.
8) Prime Minister Shri Narendra Modi visited Iran in May 2016.
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The two countries have in place several bilateral consultative mechanisms at various
levels which meet regularly. In addition to the Embassy in Tehran, India currently has two
Consulates in Iran -Bandar Abbas and Zahedan.
III. Commercial Relations
India-Iran enjoys economic and commercial ties covering many sectors. However
the trade relations have traditionally been buoyed by Indian import of Iranian crude oil
resulting in overall trade balance in favor of Iran.
The India-Iran bilateral trade during the fiscal 2014-15 was US$ 13.13 billion. India
imported US$ 8.95 billion worth goods mainly crude oil and exported commodities worth
US$ 4.17 billion. The unilateral economic sanctions imposed on Iran have had an adverse
effect on the bilateral trade as the international banking channels have gradually become
non-existent.
Trend in India-Iran Bilateral Trade (figures in Million US$)
YEAR Export from
India
Import by
India
Trade
Balance
Total
Bilateral
Trade
Growth Rate
2008-09 2534.01 12376.77 -9842.76 14910.78 15.70
2009-10 1853.17 11540.85 -9687.68 13394.02 -10.17
2010-11 2492.95 10928.21 -8435.26 13421.16 0.20
2011-12 2411.35 13556.73 -11145.38 15968.08 18.98
2012-13 3351.21 11603.79 -8252.58 14955.00 -6.34
2013-14 4971.98 10307 -5335 15279
2014-15 4175 8955 -4780 13130
Source Ministry Of Commerce, GOI(-http://commerce.nic.in/publications)
India and Iran hold regular bilateral discussions on economic and trade issues within
the framework of India-Iran Joint Commission Meeting (JCM). The 18th
India-Iran JCM
was held in New Delhi on 28 December, 2015.The meeting was chaired by External
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Affairs Minister Smt. Sushma Swaraj and Mr. Ali Taiebnia, Minister of Economy and
Finance of Iran. A MOU on cooperation in trade, finance, energy, infrastructure and
cultural issues was signed during the JCM.The Visa facilitation agreement for diplomatic
and official passport holders wasexchanged in the meeting.In the Joint Commission
Meeting (JCM), Smt. Sushma Swaraj mentioned that India considers Iran as an important
partner and expressed satisfaction at the growing bilateral interaction in diverse area. The
external Affairs Minister underlined the efforts underway to enhance bilateral economic
cooperation in energy, infrastructure – including shipping, ports and railways - and trade
and commerce. She also stressed that connectivity afforded by Indian participation in
Chahbahar Port will facilitate linking Afghanistan and Central Asia with India. The Iranian
side suggested participation of India’s public and private sectors in development of
Chahbahar Port and Chahbahar Free Trade Zone (FTZ) and in setting up industrial units in
theFTZ.
The External Affairs Minister emphasized the need for early completion of all
necessary procedures for India’s participation in Farzad-B field and pointed out India’s
desire to participate in other oil and gas explorations in Iran as well.
Prior to this, a Memorandum of Understanding was signed between India and Iran in
May 2015 by Shri Nitin Gadkari. Minister of Shipping, Road Transport & Highways and
his Iranian counterpart. As per the MoU, India is to equip and operate two berths in
Chabahar Port Phase-I with capital investment of US$ 85.21 million and annual revenue
expenditure of US $ 22.95 million on a ten year lease. Ownership of equipment will be
transferred to Iranian side on completion of 10 year period or for an extended period,
based on mutual agreement. The Iranian side had requested for provision of a credit of
US$ 150 million in accordance with the MoU. As per the MoU, operation of two berths
will commence within a period of maximum 18 months after the signing of the Contract.
The two berths will be operated by the India Ports Global Private Limited, a
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Company promoted by the Jawaharlal Nehru Port Trust and Kandla Port Trust - two major
ports working under the Ministry of Shipping. The External Affairs Minister S5mt.
Sushma Swaraj visited Tehran in April 2016 at the invitation of her Iranian counterpart
Dr.Javad Zarif.
Some of the Key features of Indo-Iran Trade relations are:
Iran welcomed the investment of Indian side in setting up plants in sectors such as
fertilizers, petrochemicals and metallurgy in Chabahar (Free Trade Zone) FTZ on
terms mutually beneficial to the concerned parties.
Iran hopes that India’s participation in developing Chabahar Port will open a new
chapter in bilateral cooperation and regional connectivity, and encourage more
maritime links and services between the two countries.
President Rouhani and Prime Minister Shri Narendra Modi agreed to strengthen the
longstanding trade ties between the two countries by, inter alia, stepping up the
momentum of economic engagement through early conclusion of a Preferential
Trade Agreement, preferably within a year.
India-Iran agreed to conclude Double Taxation Avoidance Agreement and Bilateral
Investment Treaty before the end of the year 20164.
The landmark trilateral Chabahar deal signed by Iran, India and Afghanistan will
reduce transportation expenses at least by 30 per cent.5
The Confederation of the Indian Industry (CII) is to open a regional office in
Tehran.6
India is one of the biggest buyers of Iranian crude, and is set to import at least
400,000 barrels per day (bpd) from Iran in the year from April 2016.
III. CULTURAL RELATIONS
India-Iran share civilization ties. It was believed that before 2000-3000 BC, the
inhabitants of modern Iraq and Southern Iran also the people of West and North West
India came from the same region. There was trade between the coast of Southern Iran and
4 http://www.mea.gov.in -Joint Statement-Indian Embassy 5 http://www.dnaindia.com/..... source PTI 25 May 2016 6 http://www.indianembassy-tehran.ir India-Iran Relations-Indian Embassy-Commercial Relations
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India through the Persian Gulf and the Arabian sea during the Indus valley civilization
and contemporaneous civilizations of Iran. India is mentioned in the Avesta and in Rig-
Veda there are references to Persia. Similarly, Sanskrit and Avesta have a common basic
vocabulary and common grammar, also the hymn of Gayatri resembles the Gatha of the
ancient Iranians.
India and Iran both share some common history, culture and literature. For
example, the scripture Vedas of the Indian Aryans are much similar to Avesta of the
Iranian . Sanskrit and Avesta have a common basic vocabulary and common grammar.
Early Persian poetry, creation of east Persians, cultivated abstract mental forms recalling
the grace of Buddhist statues. Panchtantra, the collection of Indian fables was translated
from Sanskrit to Pehalvi by Burzoy-e-Tabib who called it Kalilava Demna. The Taj Mahal
of Agra was constructed by an Iranian architect named IsaIsfahani.7
Measures taken to boost India & Iran cultural relations
To strengthen cultural relation between India and Iran, Prime Minister Shri
Narendra Modi gifted the Supreme Leader His Eminence Grand Ayatollah Sayyid
Ali Hosseini a specially commissioned reproduction of a rare seventh-century
manuscript of the Holy Quran attributed to Hazrat Ali, the fourth caliph. Written in
Kufic script, this manuscript is a prized possession of the Ministry of Culture’s
Rampur Raza Library. The Prime Minister also gifted the Iranian President Dr
Hassan Rouhani specially commissioned reproductions of Mirza Asadullah Khan
Ghalib’s collection of poetry in Persian, Kulliyat-e-Farsi-e-Ghalib, as also Sumair
Chand’s Persian translation of Ramayana8.
An event "India and Iran, Two Great Civilizations: Retrospect and Prospect" was
organized jointly by the Indian Council for Cultural Relations (ICCR) and the
Academy of Persian Language and Literature (Farangistan) in Tehran from 23-25
May 2016.9
7 http://www.indianembassy-tehran.ir India-Iran Historical Links 8 http://www.narendramodi.in/pm-modi-s-gift-to-iranian-president-dr-hassan-rouhani-- 9 http://www.mea.gov.in -Joint Statement-Indian Embassy
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Indian Embassy in Iran has brought out a bi-monthly magazine named “Ain-e-
Hind’ (Mirror of India) taking India to the drawing rooms of the general Iranian
public.
MoU was signed between the Indian Council for Cultural Relations (ICCR) and the
Islamic Culture and Relations Organization (ICRO) to encourage scholars, authors,
media, film community, artists, youth and sportspersons to participate in each
other's cultural and other such festivals planned for the coming two years.
On 03 May, 2013 India Cultural Center in Tehran was officially inaugurated by the
then, Hon’ble External Affairs Minister of India, during the17th India-Iran Joint
Commission Meeting (JCM).
There are about 8,000 Iranian students studying in India. India provides 67
scholarships every year to Iranian students under ITEC, ICCR, Colombo Plan and
IOR-ARC schemes.
India over the years has emerged as one of the favorite tourist destinations for
Iranian tourists and every year around 27,000 Iranians visit India for various
purposes10
Indian community in Iran
The Indian community in Iran, which was sizeable earlier, has dwindled and now it
is a small one consisting of about 100 families in Tehran and about 20 in Zahedan.
There are a number of Indian students in Iran, approximately 1300, a large number
of whom pursue theological studies in Qom.
There is an Indian school run by the Kendriya Vidyalaya Sangathan in Tehran and
another in Zahedan.
In February 2011, India successfully outsourced the tourist visa collection in Tehran
to facilitate the visa services for Iranian tourists visiting India.
10 http://www.indianembassy-tehran.ir/
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Both countries hope for a successful outcome of first meeting of the Joint Working
Group on Tourism.11
Prime Minister Shri Narendra Modi's visit to Iran
At the invitation of the President of the Islamic Republic of Iran Dr. Hassan
Rouhani, Prime Minister Shri Narendra Modi visited Iran from 22 to 23 May 2016.
During the visit, the Prime Minister called on the Supreme Leader of Iran and held a wide
ranging discussion on subjects of mutual interest with President Dr. Rouhani. The two
sides exchanged views on bilateral relations, the evolving regional situation as well as
global issues of mutual interest and recalled the principles on development of bilateral
relations articulated in the 'New Delhi Declaration' of 23 January 2003. The leaders were
united in their determination to build a strong, contemporary and cooperative relationship
that draws upon the strength of the historical and civilisational ties between the two
countries. India and Iran inked a total of 12 agreements on economy, trade, transportation,
infrastructure development, culture, science & technology and academic cooperation.
Highlights of Prime Minister Narendra Modi's Visit to Iran12
1. The Chabahar Project agreement signed during Prime Minister Modi's visit intends
to deepen ties between Iran and India and will cost $500 million to develop.
2. The new port would allow India to access Afghanistan and Europe by
circumventing Pakistan.
3. India will invest billions of dollars in Iran following the removal of sanctions.
4. The two countries have also agreed to consult 'closely and regularly' on combating
the threat of terrori
11 http://www.indianembassy-tehran.ir/ India-Iran Relations-Indian Embassy. 12 www.dailymail.co.uk/indiahome by MAIL TODAY BUREAU PUBLISHED: , 23 May 2016 )
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List of Agreements/MOUs signed during the visit of Prime Minister to Iran (May 23. 2016)13
S.No Title of MoU Description
1. India-Iran Cultural Exchange Programme
The objective is to extend the CEP for the period 2016-2019 covering the areas of culture and art; radio, TV, mass
media and cinema; and relevant general and financial
terms.
2. MoU between the Ministry of External Affairs (MEA) of India and the
Ministry of Foreign Affairs (MoFA) of
Iran on Policy Dialogue between
Governments and Interaction between Think Tanks
The MoU seeks to create a Joint Secretary/Director General policy dialogue as well as encouraging new
institutional mechanisms between think tanks on both
sides. There is also a provision for a conference on
contemporary issues of regional and global significance.
3. MoU between Foreign Service
Institute, MEA and the School of
International Relations, Iran’s MoFA
This MoU is intended to enhance cooperation between the
two parties for training of diplomats and exchange of
eminent speakers.
4. Implementation Protocol between
Department of Science and Technology, Ministry of S&T and
Iran’s Ministry of Science, Research
and Technology on Cooperation in the Fields of Science and Technology
The IP fleshes out the specific cooperation between the
two sides pursuant to the 2003 MoU and covers areas like exchange of experiences, seminars, conferences etc.
5. MoU between Indian Council for
Cultural Relations and Islamic Culture
and Relations Organizations of the IR
Iran
The MoU provides for institutional mechanisms for
cooperation between ICCR and ICRO and lays down the
modalities for the cooperation.
6. Bilateral contract on Chabahar Port for port development and operations
between IPGPL [India Ports Global
Private Limited] and Arya Banader of Iran
The contract envisages development and operation for 10 years of two terminals and 5 berths with cargo handling
[multipurpose and general] capacities.
7. MoU between EXIM Bank and Iran’s
Ports and Maritime Organization
[PMO] oncurrent specific terms for the
Chabahar Port project
This MoU is intended for the purpose of credit of USD
150 million for Chabahar port.
8. Confirmation Statement between EXIM Bank and Central Bank of Iran
This confirms the availability of credit up to INR 3000 crore for the import of steel rails and implementation of
Chabahar port.
9. MoU between ECGC [Export Credit
Guarantee Corporation] Limited of
India and the Export Guarantee Fund of Iran (EGFI)
The MoU seeks to establish a framework of cooperation
between ECGC and EGFI in supporting and encouraging
foreign trade and foreign investment between India and Iran and, where appropriate, the supply of goods and
13 http://www.mea.gov.in/bilateraldocuments.htm?dtl/26841/List_of_AgreementsMOUs_signed_ May_23_2016#)
10
S.No Title of MoU Description
services from their respective countries as part of a project to a third country.
10. MoU between National Aluminium
Company Limited (NALCO) and the
Iranian Mines and Mining Industries
Development and Renovation Organization (IMIDRO)
The objective is for the two parties to jointly explore the
possibility of manufacturing aluminium metal by setting
up of a smelter on joint venture basis in Iran and/or
entering into tolling arrangements with smelters in Iran or any other form of business collaboration including sale of
alumina etc.
11. MoU between IRCON and
Construction, Development of Transport and Infrastructure Company
(CDTIC) of Iran
MoU will enable IRCON to provide requisite services for
the construction of Chabahar-Zahedan railway line which forms part of transit and transportation corridor in
trilateral agreement between India, Iran and Afghanistan.
Services to be provided by IRCON include all
superstructure work and financing the project (around USD 1.6 billion).
12. MoU for cooperation between the
National Archives of India and the
National Library and Archives Organisation of the Islamic Republic of
Iran
The aim to for facilitation of exchange of information and
knowledge in the field of archival matters through
exchange of manuals, guidelines, rules, publications and other special literature on archival topics.
11
CHABAHAR PORT PROJECT
Iranian port of Chabahar (previously Bandar Beheshti), located on the Makran
Coast of the Sistan and Baluchistan Province of Iran criss-cross some of the most
important international corridors – East-West, North corridors, South corridor and
Transport Corridor Europe-Caucasus-Asia (TRACECA) and can be considered one of the
most strategic transit locations.
It is often referred to as the ‘Golden Gate’ to the landlocked Commonwealth of
Independent States (CIS) countries and Afghanistan. Chabahar has immense potential to
connect the business centers in South Asia (Mumbai, Jamnagar, etc), the Middle East
(Dubai), Central Asia (Turkmenistan) and Afghanistan (Milak).14
Iran plans to use this port for transshipment of a variety of goods - tea, eatables,
electronics, building materials, heavy equipments, etc. – to Afghanistan and Central Asia
and equally maintain the Bandar Abbas port as a major hub for trade with Russia and
Europe. From India’s point of view, the strategic importance of Chabahar is immense. It
not only gives access to the oil and gas resources in Iran but also provides access to
Central Asian Republics.
(http://www.dailymail.co.uk/indiahome/indianews/article-3605422/Modi-inks-500m-deal-develop-Iran-s-Chabahar-port-open-
India-s-trade-routes-Afghanistan-Europe-bypass-Pakistan.html)
14 www.acedamicjournals.org/AJPSIR (African Journal of Political Science and International Relations- India-Iran Relations:
Prospects and Challenges
12
India's involvement in the Chabahar port project is termed as a "peace project" and
"transit diplomacy"15
Conclusion
Iran is an important country in India's immediate 'economic and security space' with
India as a large and growing buyer of energy resources, and Iran being a major supplier
there is a good basis to construct a close energy cooperation relationship in future.16
Both
Iran and India have stakes in peace and stability in the region, which faces several
challenges including terrorism and violent extremism.
Prime Minister Shri Narendra Modi’s visit to Iran has imparted a timely impetus to
the ongoing efforts of the two countries and their business entities to expand bilateral
cooperation and mutually benefit from new opportunities in the wake of lifting of
secondary sanctions against Iran earlier this year. His visit to Iran is a turning point in
India-Iran relations and the beginning of new chapter in bilateral cooperations.17
15 Views expressed by Prof. Mandana Tishe Yar during the IPIS-VIF joint forum on March5,2016 in Tehran 16 Annual Report- 2014-15 Ministry of External Affairs Page No..49 17 IDSA: Issue Brief: Modi's visit to Iran: Will it provide a new momentum to bilateral relations
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References
1 http://www.indianembassy-tehran.ir
2 India Iran Historical Links Part I: http://www.indianembassy-tehran.ir
3 http://www.mea.gov.in -Joint Statement-Indian Embassy
4 http://www.dnaindia.com/..... source PTI 25 May 2016
5 http://www.indianembassy-tehran.ir India-Iran Relations-Indian Embassy-Commercial
Relations
6 http://www.indianembassy-tehran.ir India-Iran Historical Links
7 http://www.narendramodi.in/pm-modi-s-gift-to-iranian-president-dr-hassan-rouhani--
8 http://www.mea.gov.in -Joint Statement-Indian Embassy
9 www.dailymail.co.uk/indiahome by MAIL TODAY BUREAU PUBLISHED: , 23 May
2016 )
10 www.acedamicjournals.org/AJPSIR (African Journal of Political Science and
International Relations- India-Iran Relations: Prospects and Challenges
11 Views expressed by Prof. Mandana Tishe Yar during the IPIS-VIF joint forum on
March5,2016 in Tehran