Oct 10, 2018

U.S. and India headed toward clash over Iranian oil sanctions

Iranian President Hassan Rouhani with Indian Prime Minister Narendra Modi on Feb. 17, in New Delhi. Photo: Vipin Kumar/Hindustan Times via Getty Images

India, a country the Trump administration has called “a key security and economic partner,” will soon test U.S. resolve on Iran. Two Indian firms are reportedly seeking to purchase Iranian oil in November. Should the imports go through, they would contravene the stated U.S. aim of bringing Iran’s petroleum exports “as close to zero as possible” by Nov. 4.

Between the lines: Despite its goal of increasing pressure on Iran, the U.S. is considering “significant reduction exemptions” for countries trying to get to zero. To gain this exemption, New Delhi will likely cite current press reporting about its reduced intake of Iranian crude. However, recent data paints a different picture of India’s Iranian oil imports, which have stayed essentially the same for the past two months.

The details: India is second only to China as an importer of Iranian oil. September data from Tanker Trackers showed New Delhi importing just under half a million barrels of crude oil per day from Tehran — almost one-quarter of the country’s total crude exports for that month.

Washington, which left the Iran nuclear deal in May, is restoring a second, much heavier batch of sanctions on Iran in early November, targeting the country’s energy, shipping and insurance sectors. New Delhi, which initially contested the previous round of oil sanctions on Iran before reducing imports, is again publicly at odds with U.S. policy. This divergence on oil, as well as on other issues such as Russian arms imports, was on full display when Secretary of State Mike Pompeo traveled to India in September.

The bottom line: Much is riding on the Trump administration’s decision to use coercive financial measures to bring Iran back to the negotiating table. If the U.S. decides to spend political capital on sanctions waivers, it should do so only for countries genuinely reducing their dependence on Iranian crude. Otherwise, it risks undercutting the efficacy of its own sanctions, as well as ceding leverage in its relationships with countries that continue to transact with Iran.

Behnam Ben Taleblu is a research fellow at the Foundation for Defense of Democracies.

Go deeper

Federal court temporarily halts "Remain in Mexico" program

Migrant wearing a cap with U.S. flagin front of the border between Guatemala and Mexico. Photo: Jair Cabrera Torres/picture alliance via Getty Image

The 9th Circuit Court of Appeals upheld a lower court's earlier injunction on Friday, temporarily stopping the Trump administration from enforcing the Migrant Protection Protocols (MPP) — known as the "Remain in Mexico" policy.

Why it matters: Tens of thousands of migrants seeking asylum have been forced to wait out their U.S. immigration court cases across the border in Mexico under the policy. The Trump administration has long credited this program for the decline in border crossings following record highs last summer.

Go deeperArrowUpdated 2 hours ago - Politics & Policy

Coronavirus updates: WHO raises global threat level to "very high"

Data: The Center for Systems Science and Engineering at Johns Hopkins, the CDC, and China's Health Ministry. Note: China numbers are for the mainland only and U.S. numbers include repatriated citizens.

The World Health Organization raised its global risk assessment for the novel coronavirus to "very high" Friday, its highest risk level as countries struggle to contain it. Meanwhile, National Economic Council director Larry Kudlow this morning tried to reassure the markets, which continued to correct amid growing fears of a U.S. recession.

The big picture: COVID-19 has killed more than 2,860 people and infected about 83,800 others in almost 60 countries and territories outside the epicenter in mainland China. The number of new cases reported outside China now exceed those inside the country.

Go deeperArrowUpdated 3 hours ago - Health

Bernie's plan to hike taxes on some startup employees

Illustration: Sarah Grillo/Axios

Sens. Bernie Sanders (D-VT) and Chris Van Hollen (D-MD) introduced legislation that would tax nonqualified stock options at vesting, rather than at exercise, for employees making at least $130,000 per year.

The big picture: Select employees at private companies would be taxed on monies that they hadn't yet banked.