The revocation of a US waiver on sanctions affecting Iran’s Chabahar Port, which has been developed in close cooperation with India, could stall its projects.

Donald Trump revoked the exemption that had been in place since 2018 for India-linked projects at Chabahar Port on 16 September.

The sanctions could halt investment and significantly delay construction at the port.

Involved companies, including India Ports Global, now have only limited time to exit the project or face potential secondary sanctions, such as a freeze on US assets and transaction bans. 

The revocation became effective and the sanctions were reasserted as of 29 September. 

The rare 2018 sanctions waiver was issued during Trump’s first term and was allowed at the time because of the port’s importance to Afghanistan’s stability as a trade route that bypasses Pakistan.

India took over operations of the port in December 2018 and has been modernising the facilities and positioning it as a key node in the International North-South Transport Corridor. 

In May 2024, India and Iran signed 10-year contract valued at $370m for the ongoing operation and development of the port.

Maximum pressure campaign

The decision to end the waiver coincides with the Trump administration’s renewed “maximum-pressure” campaign against Iran over its nuclear programme.

It also comes amid souring relations between the US and India, with Washington pressing New Delhi to disallow oil imports from Russia and warning of measures against Indian economic interests in case of non‑compliance. 

Washington’s strategic posture towards Afghanistan following the Taliban’s 2021 takeover of Kabul has also changed.

In July 2025, the US applied a further 25% tariff to imports from India, in addition to an existing 25% baseline tariff, raising the total tariffs applied to Indian imports to 50%.

President Trump has also targeted the H1-B visa system in the US – many of which are issued annually to Indian professionals – recently raising the visa fee to $100,000.

Since the beginning of the year, the US has also applied sanctions against several Indian companies in retaliation for commercial activities involving Iranian interests.

The revocation of the sanctions waiver on operations at Chabahar Port will place additional constraints on India’s trade with Iran and put New Delhi in a difficult position – torn between its relationship with Washington and regional trade relations.

READ THE OCTOBER 2025 MEED BUSINESS REVIEW – click here to view PDF

Private sector takes on expanded role; Riyadh shifts towards strategic expenditure; MEED’s 2025 power developer ranking

Distributed to senior decision-makers in the region and around the world, the October 2025 edition of MEED Business Review includes: