US ends India’s Chabahar exemption, boosting Pakistan’s Gwadar port

Pakistan’s regional position strengthened this week after the United States ended India’s exemption to operate Iran’s Chabahar port, a move that analysts say has crippled New Delhi’s strategic ambitions and boosted Pakistan’s Gwadar port.

Kamran Khan said in his vlog that President Donald Trump’s administration has struck India with “a triple blow” by withdrawing the Chabahar waiver, slapping a new economic sanction on Iran, and shutting down Afghanistan’s trade route through the Iranian port.

“India had used this exemption since 2018 not only to reach Afghanistan but also to penetrate Central Asia economically, strategically and even in terms of intelligence,” Khan said. “Now, from September 29, India’s decade-long effort and billions in investment will sink.”

US tightens the screws

The waiver for Chabahar was granted in 2018 to facilitate Afghanistan’s reconstruction under Ashraf Ghani’s pro-American government, when U.S. Central Command still had large troop deployments in the country.

At a State Department briefing, spokesperson Thomas Pigott said the exemption was withdrawn to advance Trump’s policy of isolating Iran. He warned that from September 29, even those managing the port would face sanctions, effectively forcing India to withdraw.

This comes alongside fresh tariffs and visa curbs targeting India. Trump recently imposed a 50 percent additional tariff on Indian products for purchasing oil from Russia, while the U.S. introduced a $100,000 fee for new H-1B work visas, 70 percent of which are obtained by Indians.

Strategic setback for New Delhi

Chabahar, located on Iran’s Makran coast in the Gulf of Oman, is often described as the “gateway to Central Asia.” India has used the port since 2016 to bypass Pakistan and access Afghanistan and beyond.

In 2018, India Ports Global Limited took over the Shahid Beheshti terminal at Chabahar. Since then, more than 8 million tons of cargo and 90,000 containers have moved through the port, largely destined for Afghanistan.

The Modi government allocated annual budgets for Chabahar, and in May 2024 signed a 10-year operating contract with Iran, pledging $370 million in investment. India has already spent $120 million, but the U.S. sanctions now jeopardize the remaining $250 million.

Khan noted that Indian firms supplying cranes, containers, and shipping insurance are also expected to pull out, fearing secondary sanctions. “Indian media is already in an uproar because companies don’t want to be trapped in the American clampdown,” he said.

Pakistan and China benefit

The timing is significant for Pakistan, where Gwadar port is central to the China-Pakistan Economic Corridor (CPEC). Khan said Washington’s move effectively tilts regional balance in Islamabad’s favor.

“Gwadar’s importance has multiplied,” he said. “This American decision is a turning point that further increases Pakistan’s diplomatic and strategic weight.”

He also recalled how India allegedly misused its access at Chabahar to set up espionage networks against Pakistan, citing the case of captured Indian naval officer and spy Kulbhushan Jadhav.

Wider regional implications

India’s setback may also push Iran closer to China and Russia, and possibly to Pakistan through CPEC, Khan suggested. For Afghanistan, which remains landlocked, the loss of Chabahar reasserts dependence on Pakistani transit routes.

“Prime Minister Modi’s grand chess move to counter Gwadar has failed,” Khan said. “Time has turned the tables, and the game has ended in Pakistan’s favor.”