‘Rupee-Rial mechanism’ can ensure India’s energy security

Threats form US president not withstanding India is taking steps to start dealing with Iran by means of a Rupee-Rial India. The mechanism can have far reaching impacts both on strategic as well as business levels.

With Rupee becoming the standard for investments in Iran, all Indian investments in the country can work unabated irrespective of how the country’s Nuclear deal fares in Washington DC.

India can become a gateway to Iran, while Iran is becoming India’s gateway to Central Asia. While Iran has been long been open to Euro as currency of trade, the draconian US sanctions were dragging the financial institution with deep ties to US to the ground. As a result even now the investment into Iran has not picked up after years of the sanctions being diluted. However the same is not true for Indian or Chinese strategic investments in the region. Both of them picking up at an accelerated pace. Iranians seem to like Indians a little more than Chinese as the Indian investments do not come as loans with hefty interest tags.

Also this can enable various subsidiaries of MNC to include Iran in their Indian operations, instead of present Dubai or Abu Dhabi. The resultant trade impetus may be bigger than the short term promise of Chinese belt and road promises. The Iranian economy is ripe to grow, its demographics hungry for consumption and its industries ready to be upgraded.

The energy security that Iran can provide, too will be something to look forward to by Indians. Swings of dollar after every Fed meeting, Indian oil and gas will be secured in Indian currency. Chabahar Port, which Indian already operate on Iran’s east coast is all slated to open access to Afghanistan and further to Central Asia and beyond. The mineral wealth of the region is tied up with Russian influence and an aborration to western interests, both of which should be easy for India to manage. Samarkand may be a Uzbek city but its connection with Indian stories is age old. The new initiatives may just renew the bonds for the next generations

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