On Thursday, Trump announced a cut in tariff rates on Chinese goods to 47 percent after a meeting with President Xi Jinping, signalling a possible resolution to the ongoing tariff trade war between India and the U.S.
India has secured a six-month extension of the U.S. sanctions waiver for operating Iran’s Chabahar Port, offering much-needed relief amid tensions under the Donald Trump administration. The extension, effective from October 29, follows weeks of uncertainty after Washington threatened to revoke the seven-year-old exemption.
The exemption is critical for India’s strategic outreach. Chabahar serves as the only direct sea link between India and Afghanistan and provides access to Central Asia, bypassing Pakistan. It is also a vital component of the International North-South Transport Corridor (INSTC) — a 7,200-km trade network connecting India with Iran, Russia, Central Asia and Europe. The project is seen as India’s counterweight to China’s Belt and Road Initiative and the China-built Gwadar Port in Pakistan’s Balochistan province.
For now, the extension keeps India’s strategic and economic investments at Chabahar secure. But it remains a temporary relief. The six-month window offers breathing space, not certainty with U.S. policy on Iran still unpredictable
India confirmed on Thursday that it had secured the waiver, effective from October 29, after weeks of uncertainty triggered by U.S. threats to revoke the seven-year-old exemption. “We have been granted exemption for a six-month period on the American sanctions applicable on Chabahar,” external affairs ministry spokesperson Randhir Jaiswal said.
The U.S. had planned to revoke the waiver granted in 2018 under the Iran Freedom and Counter-Proliferation Act, which recognized Chabahar’s role in aiding Afghanistan’s development. The Trump administration’s “maximum pressure” policy on Tehran aimed to scrap such concessions, warning that entities operating through Chabahar could face sanctions after September 29.
New Delhi’s diplomatic outreach led to urgent consultations, securing first a temporary reprieve and now a formal extension. The move prevents disruption to India’s 10-year operational deal, signed in May 2024, between Indian Ports Global Limited and Iran’s Port and Maritime Organisation. Under the agreement, India committed $120 million for port infrastructure upgrades and a $250 million credit line to Tehran.
The waiver comes as India is facing U.S. scrutiny for continuing oil imports from Russia. When asked if New Delhi would seek another waiver on that front, Jaiswal said the government was still evaluating its options. He also avoided commenting on whether India might respond to U.S. tariff hikes after Washington recently classified India as its highest-tariffed partner following President Trump’s decision to reduce tariffs on Chinese imports.
