Haley tells India to cut Iran oil

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US begins to dismantle sanctions relief

NEW DELHI, June 27, (Agencies): US Ambassador to the United Nations Nikki Haley told India’s Prime Minister Narendra Modi on Wednesday it was important India cut Iranian oil use, but said the United States would work to allow India to use an Iranian port as corridor to Afghanistan. “Sanctions are coming (on Iran) and we’re going forward on that, and with India and the US building strong relationships we hoped that they would lessen their dependence on Iran,” Haley, a member of US President Donald Trump’s cabinet, told two reporters after her meeting with Modi in New Delhi.

The United States said on Tuesday it has told countries to cut all imports of Iranian oil from November and is unlikely to offer any exemptions as the Trump administration ramps up pressure on allies to cut off funding to Iran. India is one of the largest importers of Iran’s oil. “There’s a will, a political will, from both sides to figure out how to make this work,” Haley said. “Prime Minister Modi very much understands where we are with Iran, he didn’t question it, he didn’t criticize it, he understood it and he also understands that (India’s) relationship with the US is strong and important and needs to stay that way.” The US push to curb countries’ imports of Iranian oil comes after Trump in May withdrew from a 2015 deal between Iran and six world powers aimed at stalling Tehran’s nuclear capabilities in return for the lifting of some sanctions.

Trump ordered the reimposition of US sanctions that were suspended under the accord. Haley said the implications of Iran-related sanctions would be discussed when the foreign and defense ministers of India and the United States meet shortly. Japan and South Korea, also major buyers of Iranian oil, are in talks with the US government in a bid to avoid the adverse effects of sanctions.

Haley said she also discussed with Modi the Indian-backed Chabahar port complex in Iran, being developed as part of a new transportation corridor for landlocked Afghanistan and which could open the way for millions of dollars in trade and cut Afghanistan’s dependence on neighboring Pakistan.

“We know the port has to happen and the US is going to work with India to do that,” Haley said. “We know that they’re being a great partner with us in Afghanistan and really trying to assist the US and trying to do more. The port’s vital in trying to do that.” “We realize we’re threading a needle when we do that,” said Haley, describing a balancing act of ensuring Indian use of the port in Iran while Washington is at the same time trying to once again cut Tehran off from international markets. Haley has used her role at the UN to regularly attack and ramp up pressure on Iran, accusing it of meddling in Syria and Yemen. She said she spoke with US Secretary of State Mike Pompeo early on Wednesday, before meeting with Modi.

Despite rising trade tensions between the United States and India, Haley — the daughter of Indian immigrants — said “the idea of a trade war wasn’t even an option.” Bilateral trade rose to $115 billion in 2016, but the Trump administration wants to narrow its $31 billion deficit with India, and is pressing New Delhi to ease trade barriers. Haley said she also discussed military cooperation with Modi as the Trump administration has launched an effort to deepen military and economic ties with India as a way to balance China’s assertive posture across Asia.

Dismantling The Trump administration on Wednesday began dismantling the sanctions relief that was granted to Iran under the 2015 nuclear deal, a step that follows President Trump’s withdrawal from the international accord. The Treasury Department announced it had revoked licenses that allowed US-controlled foreign firms to export commercial aircraft parts to Iran as well as permitted Americans to trade in Iranian carpets, pistachios and caviar.

It said businesses engaged in any such transactions have to wind down those operations by Aug 6 or face penalties under US sanctions. Another set of licenses covering other types of commerce, including oil purchases, will be revoked in coming weeks, with firms given until Nov 4 to end those activities. The step had been expected since May when Trump pulled the US out of the landmark agreement under which Iran was given relief from sanctions in return for curbs on its nuclear program. Trump said the accord, a signature foreign policy achievement of his predecessor, President Barack Obama, was the worst deal ever negotiated by the United States because it gave Iran too much in return for too little. Trump also complained that the agreement did not cover Iran’s nonnuclear malign behavior. Other parties to the deal — Britain, China, Germany, France, Russia and the European Union — have criticized the US withdrawal, which has left the agreement at risk of collapse.

The Trump administration is stepping up efforts to isolate Iran and its faltering economy from international financial and trading systems. On Tuesday, the administration said it was pushing foreign countries to cut their oil imports from Iran to zero by Nov. 4. Previously, the administration had said only that countries should make a “significant reduction” in their imports of Iranian oil or be subject to separate US sanctions prohibiting all transactions between their central banks and Iran’s central bank.

A senior State Department official said the administration is now telling European and Asian countries that the US expects their imports to hit zero by the time the grace period ends. A US team from the State Department and the National Security Council is currently in Europe delivering the message, said the official who was not authorized to speak publicly on the matter and spoke to reporters on condition of anonymity.

The official added that the US is working with other Middle Eastern countries to increase production so the global oil supply isn’t harmed. Some close US allies are among the largest importers of Iranian crude oil, including India and South Korea. Japan and Turkey also import significant amounts of Iranian oil, according to statistics from the US Energy Information Agency. The biggest importer of Iranian oil last year was China. Meanwhile, Iran’s Supreme Leader demanded the judiciary punish those “who disrupt economic security” on Wednesday, following protests over the rial’s collapse and a tightening of US sanctions pressure that has set the arch-foes further on a course of confrontation. Resolutely opposed to Iran’s nuclear programme and its role in Syria’s war, Washington is to reimpose economic penalties on Tehran in coming months after quitting an accord in which sanctions were lifted in return for curbs on its atomic work.

This may cut Iran’s hard currency earnings from oil exports, and the prospect has provoked a fl ight of Iranians’ savings from the rial into dollars. In the latest US push against Tehran, a senior US official said on Tuesday that countries buying oil from Iran should prepare to halt all imports of it starting in November or face punishment. At Tehran’s Grand Bazaar on Wednesday, business was back to normal after a two-day strike had closed most shops.

On Monday traders had massed outside parliament to complain about the plunge to record lows of Iran’s currency. Reuters was unable to verify footage showing police clashing with protesters. Public demonstrations are rare in Iran but in recent months there have been several over the state of the economy. “The atmosphere for the work, life and livelihood of the people must be secure,” Ayatollah Ali Khamenei said in a meeting with judiciary officials, according to his official website.

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