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Our Editorial: Iran gamble pays off
Feb 20: India's strategy of curtailing crude offtake from the Iranians seems to have paid off.
8What the earlier regime did not understand, the Modi government did.
8The Iranians are tough to deal with, and they can quickly go back on a deal, as they did when they backed out of a signed LNG agreement with then oil minister Mani Shankar Aiyer.
8What Iran eventually understood was that while it could cavort with western and Russian companies for E&P investments, it needs to take care of the buyers of their oil who, in a way, will pay for these investments. India is one of Iran's largest buyers of oil and given its voracious appetite, it will continue to buy more in the future. In a world with abundant crude supplies, Iran cannot do without India but India can.
8This message finally went through and New Delhi is likely to get its legitimate share of the Iranian E&P pie
8Blunt as it may sound, mollycoddling Iran does not always pay, as India found out after it helped out with oil purchases and barter trade during the time of US sanctions only to find Iran ignoring its plea for legitimizing OVL's rightful claim on the Farzad B block once the sanctions were lifted. Iran wanted to tie up with the Russians instead.
8India will need to keep the Iranians under pressure because that is the language they understand. You cannot blame the Iranians for being that way. After years of struggling against American sanctions, they have become resilient and tough. Survival is an art and they have learned it the hard way.
8Having said that, it is also important for India to be munificent when the need arises. More give and take is needed while haggling over a few cents in a gas price deal, for example. The opportunity cost should cover much more than a higher decimal point return on OVL's investment. Political and MEA officers must always be present with an OVL delegation. Not to be forgotten is that Iran is strategically important in India's dealings with Pakistan and the Arab world. It is also the gateway to Afganistan and the world beyond through the Chabahar port.
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