A Gulf stream drives India’s foreign policy in the Middle East

India’s connections with Iran go back in time, reinforced by the strong Persian influence on Indian languages and administration. The Kohinoor diamond that graced the imperial Mughal throne drew its meaning from the Persian words “mountain of light” and record keeping in medieval India bore Iran’s imprint. Thousands of Farsi inscriptions cab be found all over India.

Yet, today India’s efforts are essentially concentrated on passage of oil and gas and the safety of Indian nationals in Iran. Of the 9,000 Indians in Iran at the start of the war, most who returned were students pursuing courses such as medicine. There are religious scholars, estimated to be around 2,500, who are not inclined to return. Many are on Qom which is seen as a relatively safe location along with other Indians awaiting evacuation. Armenia and Azerbaijan have allowed Indian nationals to be moved to their territory for repatriation to India.

Under the Ayatollahs, Iran became not only inward looking – a process accelerated by sanctions imposed by the United States and other western nations – but increasingly radicalised by an ideology that sees the US and Israel as enemies in a religious war. The India and Iran desks are close together in the United Nations where seating is alphabetical. Indian officials recall that Iranian representatives who railed against America and Zionism did so with full belief and conviction and were unchanged in their views even years after exposure to life in the West.

Apart from strategic considerations such as Iran’s role as a counter to Pakistan – the two nations have an uneasy equation – and initiatives such as development of the Chabahar port intended to provide India access to Afghanistan, areas of cooperation have been limited. The pressure of sanctions made it difficult to trade with Iran much less buy oil. But the opportunities for commerce were in case limited. Iran’s reputation as a leading sponsor of terrorism did not help nor did the bomb attack that severely injured an Israeli diplomat’s wife in Delhi on February 13, 2012.

The gradual diminution of Iran – even as it found new partners in Russia and China – was accompanied by the rise of the Gulf nations as centres of commerce, finance and trade. Dubai, Abu Dhabi and Doha became economic powerhouses as did Saudi Arabian cities like Riyadh and Damman. Oxford Economics Global Cities Index 2025 ranks GCC cities highly in the context of global peers and speaks approvingly of the dynamics behind their “economic vitality, human capital, quality of life, and long-term sustainability.”

Indian investments in the GCC grew with bilateral trade in 2024-25 just a shade short of US $ 180 billion. The traffic of Indians working in the Gulf has only grown and the Modi government has made sustained efforts to seal trade deals and actively attract capital to India. Projects involving renewable energy, telecommunications and digital retail are areas where Gulf money is flowing in.

In January, 2025, India voted against a resolution in the UN Human Rights Council but on March 11 it also co-sponsored an motion in the UN security council calling for the cessation of all attacks by Tehran on Gulf Cooperation Council (GCC) countries. It is only natural that a country’s foreign policy aligns with its interests. India is not likely to burn its ties with Iran. That would be unwise and in diplomacy its never a good idea to place all eggs in one basket. But India’s future is more closely tied with the Gulf kingdoms than ever before.