Over the past few days, reports and commentary claiming that India has been “forced to withdraw” from Iran’s Chabahar port under pressure from the United States have gained traction, triggering a sharp political slugfest at home.
The controversy was sparked by a report in a leading financial daily, which said India’s decade-long and often turbulent engagement with the Chabahar port project had effectively collapsed after US President Donald Trump announced on January 12 that any country doing business with Iran would face a 25 per cent tariff on all trade with the US.
The Congress seized on the report to accuse Prime Minister Narendra Modi of “surrendering” to the US and compromising India’s strategic interests. The BJP dismissed the charge as “pure fiction”, accusing the Opposition of spreading misinformation, and shared a video statement by MEA spokesperson Randhir Jaiswal outlining the government’s position.
A day after the report appeared, the Ministry of External Affairs clarified that India continues to operate at Chabahar under a valid US sanctions waiver until April 26, 2026, and that New Delhi is in discussions with Washington to extend and operationalise the arrangement.
Amid the political sparring, strategic experts have questioned both the premise of an Indian “exit” and the logic of sanctioning a project that directly undercuts China-Pakistan strategic interests by serving as a counterweight to Gwadar port in Balochistan.
So, has India really been forced out of Chabahar? And if so, what would the implications be?
What triggered the Chabahar buzz?
The immediate trigger was a report in The Economic Times suggesting that India could be preparing for a strategic pullback from Chabahar as US sanctions pressure on Iran intensifies.
The report came against the backdrop of growing unrest in Iran, where weeks of economic distress — marked by a collapsing rial and record inflation — led to protests after bazaars shut down across major cities. The demonstrations escalated into nationwide unrest, with slogans calling for the removal of Supreme Leader Ali Khamenei’s regime. Tehran responded by deploying Iraqi militias, shutting down internet services, and launching a crackdown that reportedly killed more than 2,600 protesters.
Around the same time, Washington announced fresh sanctions targeting entities doing business with Iran, once again bringing India’s Chabahar investments into focus.
According to the ET report, the US had already reimposed sanctions on India’s Chabahar operations from September 2025 but granted a six-month waiver to allow an orderly wind-down. The waiver is set to expire in April 2026, creating uncertainty over India’s long-term role at the port.
The report also claimed that India had liquidated its entire financial commitment to the project, transferring the full $120 million pledged to Iran more than a year before sanctions were reimposed. Government sources told the newspaper the transfer was made in advance as fund remittances would have become difficult once sanctions kicked in.
Why Chabahar matters to India
India’s engagement with Chabahar has always operated under the shadow of US sanctions on Iran. However, the port’s strategic value has ensured sustained political backing in New Delhi.
Located in Iran’s Sistan-Baluchestan province, Chabahar sits just outside the Strait of Hormuz, one of the world’s most critical energy chokepoints. For India, the port offers direct maritime access to Afghanistan and Central Asia, bypassing Pakistan entirely. It is also a key component of the International North–South Transport Corridor (INSTC), linking Mumbai to Russia and Europe via Iran.
Just 170 km away lies Gwadar port in Pakistan, developed by China under the Belt and Road Initiative. Chabahar has long been viewed as India’s strategic counter to the China-Pakistan axis in the Arabian Sea and the western Indian Ocean.
India began discussions with Iran on Chabahar in 2003, signed an MoU in 2015, and took over operations at a part of the Shahid Beheshti port in December 2018. In 2024, the two countries inked a 10-year agreement to replace interim arrangements, signalling India’s intent to secure a long-term presence. Plans also included rail connectivity from Chabahar to Zahedan on the Afghan border.
Political reactions in Delhi
The Congress launched a frontal attack on the Modi government, alleging capitulation to Washington.
In a post on X, the party claimed that “Narendra Modi has once again surrendered to Trump”, alleging that India had ceded control of Chabahar under US pressure and that $120 million of taxpayers’ money had gone “up in smoke”. It questioned why India’s foreign policy was being “dictated by the White House”.
Congress leader Pawan Khera said that retreating from Chabahar at the “first hint of pressure” represented a new low in the government’s handling of foreign policy.
The BJP countered by accusing the Congress of peddling falsehoods, insisting that India continues to operate the port under a valid US waiver. MEA spokesperson Randhir Jaiswal said the US Treasury had issued an unconditional sanctions waiver for Chabahar operations till April 26, 2026, and that India remains engaged with Washington on the issue.
What experts are saying
Strategic analysts see more nuance than the political rhetoric suggests.
Former foreign secretary Kanwal Sibal argued that sanctioning Chabahar hurts India far more than Iran and only benefits China and Pakistan. “Chabahar gives India access to Afghanistan and Central Asia. Iran doesn’t need India for that access,” he said, warning that forcing India out would open the door for China to step in.
ORF senior fellow Sushant Sareen took a more pragmatic view, arguing that India’s choices are constrained by global sanctions regimes. “India did this not out of choice but compulsion,” he said, adding that critics should acknowledge the realities of operating in a US-dominated financial system.
US-based scholar Christopher Clary noted that earlier US administrations avoided forcing India into stark choices, but suggested the current approach reflects a harder line. “This administration likes tugging on strings,” he wrote.
Others question whether an “exit” is even imminent. ORF Middle East director Kabir Taneja pointed out that Chabahar has moved at a “snail’s pace” for over two decades but has always remained a core India-Iran project. “There’s no reason for that to change,” he said.
A government official quoted by The Economic Times said India does not own physical assets at Chabahar and only runs port operations using Iranian manpower, making a temporary exit technically easier if sanctions tighten further.
So, is India really leaving?
Taken together, expert assessments suggest India has not exited Chabahar in the true sense. What appears to be unfolding is a familiar pattern — strategic ambition constrained by US sanctions, managed through temporary waivers and quiet diplomacy.
If India were to be permanently forced out, the loss would be strategic rather than financial. For now, New Delhi seems focused on protecting its larger economic interests, including $132 billion in trade with the US, while keeping the Chabahar option alive through negotiations.
Rather than a withdrawal, this looks like a tactical pause — one shaped as much by global geopolitics as by India’s long-term regional ambitions.