Historically India-Iran relationship go back to pre-independence era, when both countries shared common border along with Afghanistan. It is well known fact that India’s extended neighbourhood stretches to the Strait of Hormuz and the Persian Gulf to the West, and even to the Eastern coasts of Africa as Western border of strategic space, and Strait of Malacca to the East, Antarctica to the South and Central Asia to the North. Iran is strategically located at the entrance to the Persian Gulf, which is an important gateway for energy supply to the world and in particular to India. Iran is third largest exporter of oil to India and meets India’s 7.5% of domestic oil demand. Despite UN, EU and US sanctions imposed on Iran, India has been able to import oil against payment in Rupee term. In the present economic down turn, when the value of Rupee against Dollar is falling rapidly and oil prices are rising in the international market, India should consider increasing its oil import from Iran by making additional shipping arrangements.
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