Think US-Iran nasty relationship won’t affect you? Well, Think again.
The crude oil prices across global markets rocketed by 4%, as the news headlines on January 3, 2020, flashed the death of Qassim Soleimani, the Military leader and the second most powerful person in Iran. The drone strikes were strategically planned and executed by the US military.
It all started with the economic sanctions on Iran, and the USA quitting from the Iran nuclear deal in May 2018, the deal which kept both the nuclear countries at peace. The United States President Donald Trump claimed the deal of not being strict enough and doubted Iran’s intentions on developing long-range ballistic missiles. In October 2019, the USA killed the ISIS leader Al-Baghdadi in an airstrike and claimed victory in the vanishing the presence of ISIS in Iraq.
After the attack on Soleimani, Iran unfurled a red flag: a symbol of ‘Revenge’ atop the Jamkaran mosque in the Shiite holy city of Qom and declared three days of national mourning. On January 7th, 2020, Iran targeted the military base-camps housing American soldiers in Iraq with missiles. The strike killed several American soldiers, however, USA denied any harm caused by the strikes.
So, do we really need to worry about these two countries fighting? YES.
Dilemma with India
India is one of the most important countries in South-east Asia and exhibits friendly and strategic partnerships with both countries and thus, faces difficulty in dealing with them diplomatically.
India is not only close to Iran because of its cultural similarities but is also involved in major infrastructure projects of building railway networks and gas pipelines. One of the key projects involves the development of a seaport located in the Gulf of Oman named Chabahar port, a seaport important to India due to its geopolitical location, this port forms a gateway to trade in countries such as Afghanistan and regions of Central Asia where India is trying to find its potential market. Earlier India imported 10% of its crude oil from Iran but due to the pressure of economic sanctions from the US government, India was bound to cut down on Iran’s oil supply and to a considerable amount and find alternate sources. However, India never stopped importing oil from Iran.
The USA is an important military and economic partner to India. Both countries understand their importance of combating rising superpower China and its intentions of dominating trade in Asia with ‘One belt, one road’ initiative. India imports most of its arms and ammunition from America and has a major contribution to its GDP. After 9/11, the two countries conducted joint military operations to tackle terrorism. USA and India are both strategically and economically co-dependent.
FIVE major aftermaths of escalating tension
- Generally, Indians in the middle-east work as manual laborers and domestic staff in steel mills, construction companies, and Oil companies. If the relations between Iran and the United States keeps on deteriorating, the life of 8 million Indians living in Iran and Iraq can be threatened. Recently, due to bombing and missile attacks, the Ministry of External Affairs of India in Baghdad has issued an advisory to stay safe and indoors as well as avoid non-essential travel in gulf countries.
- Tensions between Iran-US will hurt India’s slowing economy to a great degree. India receives $84.2 billion dollars (as per a report by business today in 2018) remittance from people living in middle eastern countries. With mounting tensions, the foreign investors and residents who make a transfer between the Middle East and India will be forced to retract their money back due to a downfall in the security.
- With India struggling to revive its GDP (4.5% as per January 2020) and fight inflation, a surge in crude oil prices may make the situation even worse. Hike in oil can lead to a further downfall in the automobile sector, which has a major contribution to the Indian GDP. All major airline companies are advised to divert their route and avoid the Iran-Iraq airspace which may increase fuel consumption and we may encounter last-minute fare hikes. Again, the tensions between the two countries are to be blamed.
- Foreign Investment in Indian markets could be kept at bay, which can create high rates of unemployment to an already 45-year high unemployment rate of 6.1%. The additional tax revenue generated by private companies may also dip due to ceasing profits which further can create a loss in government’s piggy bank. The people who have invested in Oil share markets can face a long term loss in their investment.
- World peace and unity are threatened as these tensions can escalate to World War III as per several media reports. Resolving issues with warfare should not be an option for these countries. India, which is an important strategic and economic partner to Iran and the US has a critical role to play in calming these war-headed nations and prevent the destruction of life and property.
As citizens of a great nation, we can contribute to making this world a better place to live which blooms with peace and prosperity. Let’s create a society where future generations cannot look down upon us and question our sanity because when the war comes it is just not on the combating countries but upon all of us.
