India Pays $120M to Iran, Ends Chabahar Involvement

India has transferred approximately $120 million to Iran to settle its financial obligations for the development of the Chabahar port, a move that effectively ends New Delhi's direct involvement in the strategic project amid renewed U.S. sanctions pressure. The transaction, confirmed by government sources, clears India's liabilities and allows Tehran to use the funds freely, following a six-month sanctions waiver granted by the U.S. Treasury Department in October 2024 that remains valid until April 26, 2026.

The Chabahar port, located on Iran's southeastern coast in Sistan-Baluchistan province, serves as a vital gateway for India to access landlocked Afghanistan and Central Asia, bypassing rival Pakistan. In May 2024, India and Iran signed a 10-year agreement granting Indian Ports Global Ltd. operational control over the Shahid Beheshti terminal for cargo and containers. However, escalating U.S. tensions with Iran prompted Washington to revoke broader sanctions waivers in September 2025 and impose new restrictions effective that month. U.S. President Donald Trump further intensified the pressure on January 12, 2026, by warning that countries engaging in business with Iran would...