US lifts economic sanctions against Iran
WASHINGTON: India is now free to resume normal trading ties with Iran, which were disrupted by US and EU sanctions related to Tehran’s nuclear weapons prog-ramme that were lifted on Saturday.
India will also be able to release payments of around $6.5 billion that its state-owned refineries owed Tehran for crude oil purchases that were held up because of the international sanctions.
The sanctions were lifted after the International Atomic Energy Agency certified Saturday — Implementation Day — that Iran had completed its part of the agreement with western powers.
“This is a good day,” US President Barack Obama said Sunday in his first remarks on the lifting of sanctions. But, he added, “We still have sanctions on Iran for its violation of human rights — for its support for terrorism and… its ballistic missile programme.” The US announced new sanctions Sunday related to Iran’s ballistic missile programme, blacklisting three entities and eight individuals. But they are not likely to impact India, as before.
Under the Joint Comprehensive Plan of Action, as the agreement was called, Iran has shipped out of the country 25,000 pounds of enriched uranium, cutting its stockpile by 98%. It has removed two-thirds of its centrifuges, shuttered its facility that produced weapons-grade plutonium, and allowed IAEA inspectors unprecedented access to its nuclear facilities.
Its breakout time — the time it would take to make a nuclear bomb — has been increased six fold as a result from two months to a year, a senior US official told reporters in Washington. The US and Iran also announced Saturday a swap of prisoners in which Washington Post journalist Jason Rezaian is headed home to freedom, with four other Americans. Obama on Saturday signed executive orders lifting the sanctions, including those called “secondary” that applied to non-US individuals and entities, such as Indian refineries.
Gone, therefore, were sanctions on Iran’s energy and petrochemical sectors, those related to banking and financial institutions, underwriting services, insurance and re-insurance.
India was Iran’s second largest crude client, after China, till July 2012 — and briefly became its top buyer picking up 13% — when the EU oil embargo was announced.
It went down to 11% after the US sanctions, and soon dropped to being the number seven seller to India, which turned to Saudi Arabia and Iraq to make good the shortfall. India was initially reluctant to honour sanctions not mandated by the UN — but gave in under US pressure and the threat of denying sanctions-violators access to the American financial system.
Additionally, the US sanctions made it difficult for India to pay for crude purchased from Iran as it was prohibited under the sanctions from dealing with designated Iranian banks.