India and the Iranian-Saudi Divide

Why New Delhi Hedges Its Bets

Indian Prime Minister Narendra Modi and Iranian President Hassan Rouhani in Ufa, Russia, July 2015.  BRICS / SCO Photohost / RIA Novosti / REUTERS

For decades, India’s commitment to nonalignment has granted it close relationships with states that are at odds with one another. During the Cold War, India refused to ally with either the Western capitalist countries or the Soviet-led Communist bloc, making use of its postcolonial legacy to nonviolently push for cooperation among the countries of the so-called Third World. Today, in the Middle East, India has successfully maintained ties with Iran, Israel, and Saudi Arabia—three countries that are locked in competition.  

Given that the rivalry among those three states could eventually lead to war—endangering India’s interests in the Middle East, where it sources most of its energy and where millions of Indian emigrants live—New Delhi must carefully navigate the growing divide in the Persian Gulf. If it does so successfully, it can avoid getting entangled in regional tensions and consolidate its position as a key player in the Middle East. 


The modern rivalry between Iran and Saudi Arabia began just after the 1979 Iranian Revolution, when Iran called on Muslims across the Middle East to replace their governments with theocratic regimes like its own. Tehran’s zeal for revolution rattled Saudi Arabia, which began to back Sunni groups to counter it. By bankrolling Iraq’s bloody invasion of Iran in 1981, the Saudis and their Arab Gulf allies set the tone for the bitterness that has lasted to the present.

Today, Saudi Arabia is waging a war against Iranian-backed Houthis in Yemen; in Syria, Iran supports the regime of Bashar al-Assad against Saudi-funded Sunni fighters. In June, a Saudi-led coalition imposed a blockade on Qatar, which Saudi officials claimed had cozied up to Tehran and supported terrorist groups—a move to consolidate Riyadh’s regional status and isolate Iran from its neighbors.

A Saudi soldier near the border with Yemen, April 2015. Faisal Al Nasser / REUTERS

The competition between Iran and the Saudi-aligned Gulf states is a dilemma for India, because it has deep interests on both sides of the divide. Trade is the first among these. India’s trade with the Gulf

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