The United States has put into action the enforcement of its second round of sanctions on Iran, commencing November 5th. This round primarily targets oil and petrochemicals, closely following the first set of restrictions which focused on Iran’s aviation sector, auto industry, the trade in gold and other precious metals. They were imposed on August 7th.
The JCPOA and Iran’s Nuclear Program
In 2015, a global agreement was formed by Iran and the P5+1 group, comprised of the US, UK, France, China, Russia, and Germany. It focused on Iran’s nuclear program and was known as the Joint Comprehensive Plan of Action (JCPOA), or more commonly referred to as the Iran Nuclear Deal. This arrangement came to be after years of worldwide tension surrounding Iran’s supposed endeavors in developing nuclear weaponry.
Despite Iran’s insistence that their nuclear pursuits were purely peaceful, this assertion was met with skepticism by the international community. Under the terms of the JCPOA, Iran consented to limit its nuclear activities. This included halting uranium enrichment and allowing international agencies to monitor its nuclear facilities, all in exchange for the lifting of economic sanctions.
US Withdrawal from the JCPOA
The United States has criticized the deal with Iran for not addressing the threat posed by Iran’s missile program, and for lacking a robust enough protocol for inspections and verification of Iran’s nuclear sites. The US pulled out of the JCPOA in May 2018. Alongside its withdrawal, it also threatened to levy sanctions on Iran and on countries involved in significant trade relations with Iran.
However, no other signatory of the agreement has endorsed the US position on the deal. Even the United Nations has expressed significant concerns about the decision. Furthermore, the US has not provided any evidence to suggest that Iran violated the terms of the JCPOA. In contrast, a report produced by the International Atomic Energy Agency in June found that Iran’s uranium and heavy water stockpile was “in compliance” with the agreement.
Key Facts
| Fact | Detail |
|---|---|
| P5+1 Group | US, UK, France, China, Russia, Germany |
| Sanctions Enforcement Date | November 5th |
| First Sanctions Enforcement Date | August 7th |
| Iran’s Rank as Oil Supplier to India | Third |
| US Withdrawal from JCPOA | May 2018 |
Impact on India
Positioned as the third largest supplier of oil to India, Iran plays a significant role in the Indian economy. Despite India receiving a temporary exemption from these sanctions, this could potentially raise global oil prices, consequentially increasing India’s import bill. Alongside financial implications, India also has strategic interests in Iran which may be influenced by the sanctions, including economic investments in the Chabahar port and the International North-South Transport Corridor.
