India, Iran, Afghanistan had inked a pact to use Chabahar Port as a regional hub for sea transportation

Highlights Will end privileges to India if it tries sourcing oil from others: Iran

Chabahar port is seen as gateway for trade with central Asian countries

US had asked India, other nations to cut oil imports from Iran to "zero"

Iran on Tuesday criticised India for not fulfilling its promise of making investments in expansion of the strategically located Chabahar port and said New Delhi will stand to lose "special privileges" if it cuts import of Iranian oil.

Iran's Deputy Ambassador and Charge d'Affaires Massoud Rezvanian Rahaghi said Iran will end the privileges being provided to India if it tries to source oil from countries like Saudi Arabia, Russia, Iraq, the US and others to offset cuts in Iranian oil.

"It is unfortunate that Indian investment promises for expansion of Chabahar port and its connectivity projects have not been accomplished so far. It is expected that India takes immediate necessary measures in this regard if its cooperation and engagement in Chabahar port is of strategic nature," he said.

Mr Rahaghi was speaking at a seminar on 'emerging challenges and opportunities in the global diplomacy and its impact on bilateral ties with India'.

The Chabahar port is being considered a gateway to golden opportunities for trade by India, Iran and Afghanistan with central Asian countries in the wake of Pakistan denying transit access to New Delhi.

In May 2016, India, Iran and Afghanistan had inked a pact which entailed establishment of Transit and Transport Corridor among the three countries using Chabahar Port as one of the regional hubs for sea transportation in Iran, besides multi-modal transport of goods and passengers across the three nations.

Referring to US sanctions on oil import from Iran, Mr Rahaghi said his country has been a reliable energy partner for India and that Iran always follows a "rationale pricing" of oil which ensures the interest of both consumers and suppliers.

"... If India were to replace Iran with countries like Saudi Arabia, Russia, Iraq, the US and others for the 10 per cent of its oil demand then it may have to revert to dollar-denominated imports which mean higher CAD (Current Account Deficit) and deprivation of all other privileges Iran has offered to India," Mr Rahaghi said.

The senior Iranian diplomat said it was important to work together to immunise the relationship between the two countries through adoption of necessary instruments and mechanisms.

"We should strive to make this relationship more sustainable and durable. This requires a strong political determination," he said, adding both sides should set up banking relations, open new transaction routes and help each other's markets and business communities.

Iran is India's third-largest oil supplier after Iraq and Saudi Arabia. Iran supplied 18.4 million tonnes of crude oil between April 2017 and January 2018 (first 10 months of fiscal 2017-18).

The US has told India and other countries to cut oil imports from Iran to "zero" by November 4 or face sanctions. The Trump administration brought back sanctions against Iran after pulling out the US from the Iran nuclear deal.

Shipping to Iran and ports in the country are also coming under the US sanctions.

India is also expected to convey to the US the importance of the Chabahar port project considering that it can be a major link for trade with war-ravaged Afghanistan.

"In such a selfish approach, the US is targeting the whole world -- either to be its friends and allies or be rival. So the US must abandon its policy of resorting to threats or use of force," said Mr Rahaghi.

In May, President Donald Trump announced that the US was withdrawing from the Iran nuclear deal signed by the Obama administration in 2015, under which Tehran had agreed to limit its sensitive nuclear activities and allow international inspectors in return for lifting of crippling economic sanctions.

Mr Rahaghi also suggested that a regional dialogue forum should be set up in the Persian Gulf and West Asia to resolve regional crises.