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The Indian government, under Prime Minister Narendra Modi, has faced significant domestic criticism after withdrawing from the Chabahar port agreement with Iran. Critics describe this move as a strategic retreat rather than a deliberate foreign policy action.
New Delhi had to step back from its involvement in the port following a U.S. imposition of a 25% tariff on nations conducting business with Tehran, according to The Economic Times on Thursday. The article reports that India’s withdrawal was executed without any official announcement, resulting in a loss of $120 million previously paid to Iran. That money, transferred before the decision to disengage, is now considered unrecoverable.
India Ports Global Limited (IPGL), the state-owned company operating at the port, saw its board of directors resign collectively following the withdrawal, and the official company website has also been shut down. Pawan Khera, a leader of the Congress party, called the move “a new low” for Modi’s foreign policy.
He questioned whether Prime Minister Modi’s administration is allowing the U.S. to influence India’s decisions, questioning, “Why is Modi letting the USA arm-twist India?” He further highlighted that India took responsibility for developing Chabahar in 2024 under a decade-long agreement with Iran.
A foreign publication reported that the $120 million already paid to Iran can now be used at Iran’s discretion for the port’s development and construction. Observers see India’s pullout as a major setback for New Delhi’s regional ambitions. The opposition sharply criticized the decision, accusing Modi of once again surrendering to U.S. pressure. A post on the Congress party’s social media account stated, “$120 million of Indian taxpayers’ money was invested by Modi’s government, but now it’s all lost.”
The opposition also recalled Modi’s previous claims of the port agreement being a “major strategic win,” noting that India’s control over the port has been relinquished with little explanation from the government. They argued that Modi bowed to Trump’s pressure at the expense of India’s national interests.
Experts in economics believe these developments deepen concerns over India’s role at Chabahar. They suggest that India may be using the port for questionable purposes, implying that IPGL’s actions indicate the company was primarily created to take control of Chabahar.
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