In allowing India a six month waiver over US sanctions against Iran, President Donald Trump has not done anyone a favour. For all his talk about reducing Iran oil exports to zero level to please the powerful Saudi and Zionist lobbies it is not possible in 2018 for the US-EU combine to bend every country to their will.
US has already imposed similar economic sanctions against China, Russia and Turkey. There is no denying that both Turkey and Iran are economically hurting because of the US sanctions. As for Russia and China--- not much has changed! However the Irani riyal and the Turkish lira are in a free fall, prices are rising domestically as inflation may reach threatening proportions. Both Mr. Rouhani and Mr. Erdogan will be subject to the twin pressures of domestic unrest and finding critical economic remedies.
Powerful lobbies in both US and Europe are opposed to the so-called trade wars unleashed by their leaders and the sanctions against so many advanced countries. As a Singapore-based US industrialist told the media recently, such sanctions cut the US off from most major countries in the world, where earlier American goods were being exported regularly. ‘Does this not cost the US industry and hurt the prospects of job seekers at home?
Therefore, in view of the sudden weakening of Mr. Trump’s position at home, the US’ decision of allowing six month waivers to India, Japan and South Korea among others, on the matter of buying Iran oil helps Washington itself more than Delhi. Following US tariff increases on some items exported by India and a strong warning to Japan to reduce its trade surplus in its American trade, both India and Japan, have started distancing themselves from Washington.
Thus Japan who has consistently maintained a low profile internationally, has opened up to Russia and China. With the latter, it has just concluded a bilateral trade deal amounting to over $30 billion, remarkably quickly. This has come as a surprise to Western observers. Also, with Russia, Japan has proposed a long term peace treaty, to be followed by bilateral economic and other deals. Negotiations are on. Russia needs advanced Japanese technology, while Japan needs a steady supply of energy.
As for India, even before the six month period ends, Delhi will try to revive the type of trade it had with Iran during the earlier Western sanctions. The two countries avoided the US dollar and dealt in terms of the rupee and the riyal instead. Iran is India’s second largest oil supplier next to Iraq. On the other hand, Russia and China plan to defy the Western sanctions and will not stop buying from Iran. Interestingly, led by Germany, France and others, many EU countries are also seeking ways to continue trade and business with Iran.
Obviously the Saudis, no lovers of Iran, have plans to take over the earlier markets where Iran sold its oil, as OPEC has announced plans not to cut production. According to some estimates, the sale of Iranian oil is already down by 20%, but the figure could increase rapidly in the weeks ahead, as Teheran braces to take the big economic hit once more.
