The Trump administration has said that individuals operating the Iranian port of Chabahar will face sanctions beginning later this month, a decision that will have implications for India, which is involved in developing a terminal at the strategic port.
Located in Sistan-Balochistan province on the energy-rich country's southern coast, Chabahar port is being developed by India and Iran to boost connectivity and trade ties.
The move to revoke the 2018 sanctions waiver is consistent with President Donald Trump's maximum pressure policy to isolate the Iranian regime, State Department principal deputy spokesperson Thomas Pigott said in a statement earlier this week.
"The Secretary of State has revoked the sanctions exception issued in 2018 under the Iran Freedom and Counter-Proliferation Act (IFCA) for Afghanistan reconstruction assistance and economic development, effective September 29, 2025. Once the revocation is effective, persons who operate the Chabahar Port or engage in other activities described in IFCA may expose themselves to sanctions under IFCA," Pigott said.
India would be affected by this decision, as it is involved in developing a terminal at the Chabahar port on the Gulf of Oman. On May 13, 2024, India signed a 10-year contract to operate the port that will help it expand trade with Central Asia.
This was the first time India would take over the management of an overseas port. New Delhi had proposed to develop Chabahar port way back in 2003 to provide Indian goods a gateway to reach landlocked Afghanistan and Central Asia using a road and rail project called International North-South Transport Corridor (INSTC), bypassing Pakistan.
The INSTC is a 7,200-km-long multi-mode transport project for moving freight among India, Iran, Afghanistan, Armenia, Azerbaijan, Russia, Central Asia and Europe.
US sanctions on Iran over its nuclear programme had slowed the development of the port.
The long-term agreement was signed by Indian Ports Global Limited (IPGL) and the Port & Maritime Organisation of Iran. It replaces an initial 2016 pact, which covered India's operations at Shahid Beheshti terminal in Chabahar port and had been renewed on an annual basis.
In 2023, Chabahar port was used by India to send 20,000 tonnes of wheat aid to Afghanistan. In 2021, the same was used to supply environmentally friendly pesticides to Iran.
The US had exempted the Chabahar port project from sanctions in 2018, saying "the secretary has provided for an exception from the imposition of certain sanctions under the Iran Freedom and Counter-Proliferation Act of 2012 (IFCA) with respect to the development of Chabahar Port and the construction of an associated railway and for the shipment of non-sanctionable goods through the port for Afghanistan's use, as well as Afghanistan's continued imports of Iranian petroleum products.” However, with the new guideline, these exemptions will be removed.
The US-backed government in Afghanistan was ousted by the Taliban, which seized power in 2021 following the withdrawal of American forces.
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