Israel–Iran Conflict: Escalation and Implications for India

Current Status:
The Israel–Iran conflict has escalated into a full-blown warzone, with both nations now attacking each other’s territories and infrastructures directly.

Brief History of Israel–Iran Tensions

• 1953: US backed a coup in Iran, reinstating Shah Pahlavi to power.

• 1957: US-Iran nuclear cooperation began with reactor and uranium support.

• 1970: Iran ratified the Nuclear Non-Proliferation Treaty (NPT).

• 1979: Islamic Revolution toppled the Shah, severing US-Iran ties.

• 1984: US supported Iraq during its war with Iran.

• 1995: Russia aided Iran in building a nuclear reactor.

• 2002: Western intelligence exposed Iran's secret enrichment program.

• 2010: Cyberattack (Stuxnet virus) damaged Iran’s centrifuges — allegedly by US-Israel.

• 2015: A global deal was signed to limit Iran's nuclear activities.

• 2018: US exited the deal under Trump administration.

• 2020–2021: Israel intensified attacks; Iran enriched uranium up to 60%.

• 2023: Iran supported Hamas’s attack on Israel from Gaza.

• 2024: Direct attacks began: Israel’s “Operation Rising Lion” vs. Iran’s “True Promise 3”.

Why Israel and Iran Matter to India

• West Asia’s Role: Provides 54% of India’s oil imports and 40% of remittances.

• Israel: A key defence partner, with imports rising from $5.6M (2015) to $128M.

• Iran: Though trade fell to $1.4B in 2024, Iran remains vital for energy and connectivity.

• Diaspora: Around 10,000 Indians in Israel and 25,000–30,000 in Iran.

• Strategic Routes: Projects like the India-Middle East-Europe Corridor (IMEC) and International North-South Transport Corridor (INSTC) rely on both nations.

Impact on India

• Trade Disruption:

  • India-Israel trade dropped from $11B (2022) to $3.75B (2024).

  • Iran trade declined to $441M amid payment delays and risks.

• Energy Risk:

  • 60–65% of Indian oil imports pass through the Strait of Hormuz, now under threat.

  • Rising oil/LNG prices could strain the Indian economy.

• Connectivity Delays: Conflict affects progress on IMEC and INSTC.

• Spiraling Costs: Shipping, insurance, and import costs could rise, affecting inflation.

Geopolitical Challenges for India

• Balancing Act: US and G7 back Israel, while the Global South sympathizes with Iran.

• Pakistan Angle: Potential US-Pakistan cooperation in Iran may complicate India’s stance.

• BRICS Dilemma: With Iran in BRICS, India must navigate group positions carefully.

• Gulf Relations: India must also manage ties with other Gulf nations amid rising tensions.

India’s Response So Far

• Calls for Peace: India urged restraint and dialogue from both sides.

• Diplomatic Outreach: EAM Jaishankar held discussions with Iranian leaders.

• Neutral Stance: MEA avoided direct criticism of Israel or Iran.

• SCO & UN Abstentions: India dissociated from SCO's anti-Israel statement and abstained from a UN ceasefire vote.

• Evacuation Effort: Launched Operation SINDU to bring citizens home safely.

The Road Ahead for India

• Diplomatic Role: Push for de-escalation through Track II dialogue involving regional and global players.

• Energy Diversification: Reduce dependency on Gulf oil routes.

• Strategic Navigation: Balance ties with Israel, Iran, the Gulf, and global blocs like BRICS, SCO, and Quad.