The Role Of China In Restoring Iran-Saudi Arabia Ties: What Does It Mean For India? –

West Asia forms “an important part of India’s extended neighbourhood” and is vital to “India’s strategic interests”. India has vital stakes in “the stability, security, and economic well-being” of the region. The region supplies approx “50 percent of India’s crude oil requirements, over 70 percent of its natural gas requirements, hosts about 9 million Indians, and accounts for 60 percent of remittances” received in India annually. 

According to Rajeev Agarwal, security challenges in the region will have, “A ripple effect for India,” and therefore, any instability in the region has “a direct bearing on the safety and security of millions of Indians working there, our energy security, and our steadily growing trade relations”. 


What’s there for India?

The Saudi-Iran peace deal, therefore, offers much hope to India. Although India has not said much on the deal as such, it has “welcomed the deal”, saying that “it always supports the resolution of conflicts through dialogue and diplomacy”. He further stated that Iran and Saudi Arabia form “the major power block, and any reconciliation between them opens further opportunities” for India. India already has “comprehensive trade and business relations” with Saudi Arabia. The deal that “promises the end of conflict in Yemen too” is important for India. 

Also, any potential conflict between “the two main rivals anywhere in the region puts millions of Indians working in the region in danger”. Therefore, peace in the region is “a welcome step for India”. It also opens up many “trade and business opportunities” for India. A peaceful region offers opportunities for India “to collaborate better with major countries” in the region to “promote trade”, which is beneficial in the long run. (Agarwal, 2023).

In recent times, India has made moves to make “deep strategic inroads in the Gulf region through defence and military” cooperation. India has been conducting “joint military exercises with countries” ranging from Oman and the UAE to Saudi Arabia. The Gulf states are looking towards “India as a good investment destination as leaders of both regions have exchanged visits to each other’s capitals”. 

India and Indians may find better opportunities and an atmosphere for deeper economic engagement with the region in a more peaceful and stable environment if Shia-Sunni reconciliation is extended to the entire Arab region (Kumar, 2023).

A week later, MEA spokesman Mr. Arindam Bagchi stated: “We have seen the reports regarding this. India has good relations with various countries in West Asia, and we have abiding interests in the region. India has always advocated dialogue and diplomacy to resolve differences” (Subramanian, 2023). But what does it mean for India? India has done well in recent years in forging much closer relations with key Gulf States like Saudi Arabia, the UAE, and Oman. It has been able to do so even while forging a close strategic partnership with Israel. 


Abraham Accords pave the way

The Abraham Accords opened the door to bringing together India, Israel, the UAE, and the US in a quadrilateral regional framework. India should seek a closer and enhanced relationship with Iran as well. India has been successful in expanding its relations with all key actors in West Asia. However, it is not in India’s interest to see China expand itself in a country that is strategically important. 

China has reportedly concluded a 25-year security and economic partnership with Iran worth $400 billion. If this is true, then it will not be possible for India to match it. However, India must find ways to revive and expand its energy partnership with Iran and fast-track the implementation of the Chabahar port and the transport corridor that would link it to Central Asia (Saran, 2023). 

Moreover, Iranian ambassador Iraj Elahi to India stated that “I think the agreement should not be a concern” for India. It would be of “benefit to India since it would help intensify stability and peace” in the Persian Gulf region. Peace and stability in the Gulf region will “benefit the Indian diaspora” as well, besides resulting “in greater economic engagement that would include India’s trade ties with various countries” in the region. 

Iran believes that the Indian government has “a positive attitude” towards it. We understand “the willingness of the Indian government towards Chabahar. We believe that Chabahar is not just an economic issue”. He stated that there is a need to view “the Chabahar port project as a strategic engagement and not just an economic partnership”. Because of this importance, “the speed of cooperation, the speed of progress, and the speed of promotion in Chabahar should be faster than what it is now”. 

It is important for India as well as Iran. It will be for our benefit (Mid-Day, 2023). According to Sandeep Dixit, Iran wants India “to resume its purchases of crude” in the wake of the Iran-Saudi Arabia ties. Iranian President Sayyid Ebrahim Raisi is likely “to take the talks forward” when he arrives in India in September 2023 for “the summit of the Shanghai Cooperation Organisation,” where Iran will be formally included as a member. Iranian Ambassador Iraj Elahi openly hinted that India missed the opportunity to mediate between Saudi Arabia and Iran instead of China; he said no one from India “approached us to express readiness to bridge the gap” but emphasised that “India always had constructive policy” for the region (Dikshit, 2023).

Challenges for India

The restoration of diplomatic ties between Iran and Saudi Arab under “an agreement brokered by the Chinese could have significant ramifications for geopolitics” in West Asia. Though West Asia experts advocated “a wait-and-see approach to see how things would pan out between Saudi Arab and Iran”, two “arch-rivals in the region” that are also “divided on theological grounds”, China’s role in “facilitating the agreement was “a surprise for many since it had never played such a role in the region’s diplomacy” (Laskar, 2023a). China’s emergence as “a new power broker” in West Asia, especially as part of Chinese efforts to “engineer a new world order at a time of heightened tensions” with the US, will be viewed warily by India. 


Talmiz Ahmad, who served as India’s envoy to Saudi Arab, Oman, and the United Arab Emirates (UAE), and who has repeatedly advocated “a role for India in mediating” between Iran and Saudi Arab, said, “This has always been part of our space, especially after India strengthened ties with several countries over the past decade or so. There is a worry that India could now withdraw into the background” (Ibid.,). 

For India, this is a crucial moment. Its principal adversary has announced itself as a geo-political player in the Arabian Gulf, a region to which India has age-old ties. While deepening those ties, Delhi also allied itself with the US, whose role in the region now seems more diminished than ever. The Israel-India-UAE-US (I2U2) was to be the post-Abrahamic Accords security paradigm for the region (Editorial, 2023). Moreover, it was expected that eventually the grouping would include Egypt and Saudi Arabia. It is perceived as “potentially an influential coalition”, backed by US power, “to serve as a constraining factor on Iran and, importantly, exclude China”. The Saudi-Iran deal has put a question mark on the viability and endurance of the I2U2 process (Saran, 2023).

On the other, China has repeatedly declared that “its interests in the region are only economic”. Some scholars believe that “it is only a matter of time before Beijing establishes a military presence” in the region. This deal, therefore, comes with “a huge red flag for India and raises important geopolitical and strategic questions” before India. At the same time, Indian and Chinese interests in “the Gulf have the potential to be in conflict”. Like India, China is a “major importer of Saudi oil”. China imports oil from “Iran which is substantial, whereas Iran has traditionally been a major hydrocarbon supplier” for India (Shapoo, 2023). A China-friendly region would “give Beijing leverage to manipulate India’s interests”. 

In such a scenario, “the region under China’s sphere of influence may fundamentally undermine India’s commercial and security interests”. Indian interests will be compromised “if China intends to use the Gulf region for its force projection”. India needs to patiently assess “if China’s growing involvement in the Gulf is detrimental to its long-term security interests and the regional balance of power”. At the same time, recent developments also provide a window of opportunity for India to embed itself as a significant player in the region (Ibid.).


The former Prime Minister Henry Palmerstone in the British Parliament in 1848 said, “We have no eternal allies, and we have no perpetual enemies. Our interests are eternal and perpetual, and those interests are our duty to follow”. This statement is equally true for the Iran-Saudi Arabia deal, which has seen a big breakthrough in the regional politics of West Asia. In these changing alignments, there are many opportunities as well as challenges ahead for India. However, India has to actively engage in West Asian regional politics, and it should not leave any stone unturned. 

In the absence of US influence, it is clear that China is getting a handful of opportunities to increase its geo-economic and geo-political influence. On the other hand,  China is emerging as the biggest competitor for India. If China strengthens its position in West Asia, it will definitely undermine the geopolitical interests of India. The Iran-Saudi Arabia deal has changed the equations of the region overnight. For India, economic interests are not sufficient, but it has to focus geopolitically and develop a long-term strategy so that the increasing role of China can be limited in the future. 

Of course, India has its own limitations and cannot compete with the might of China, but that does not mean that China should have a free hand in the region. To counter Chinese influence, India must develop close relations with the regional countries, particularly Iran, especially after the deal. Iran is a very important country in the West Asian region. This is a very good opportunity for India, where New Delhi can correct its past policies and rebuild ties with Iran again. Tehran is looking towards New Delhi as a rising power in the South Asia region. Iranian ambassador Iraj Elahi gave a clear indication for Indian investments in the Chhabahar port. India cannot ignore the rich resources lying in the Central Asian region. For India, Iran opens a window to the region. Here, India has a win-win situation with Iran in the coming future.

The author is a research scholar at Jawaharlal Nehru University, New Delhi.

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