The ongoing US-Israel war on Iran has created one of the most stressful diplomatic scenarios India has dealt with in West Asia. Among others, it complicates India’s two most vital yet parallel relationships with the US and Russia. India is simultaneously managing relations with Iran, Israel, the Gulf monarchies, and the US, while attempting to abide by its policy of mutli-alignment, which is intended to preserve New Delhi’s strategic autonomy. What once appeared to be a rather successful model of “working with multiple partners simultaneously on different issues” is now under significant pressure, with the conflict destabilising the region by disrupting maritime trade and global energy flows.

India’s challenge goes beyond balancing between US-Israel and Iran. The Trump administration’s singular focus on a transactional foreign policy led to the imposition of heavy tariffs on India. India’s cagey response to the US-Israel decapitation strikes against Iran was read as “silent.” The Trump administration pressured India to stop oil imports from Russia amid the Russia-Ukraine conflict, while later extending a periodic sanctions waiver to balance some of the negative impacts of the global energy crisis caused by the war on Iran. While such short-term waivers may be understood as a positive moment for India, US sanctions—both in their application and temporary relief—only illustrate how India’s multi-alignment is vulnerable to great power pressures, especially when India’s interests diverge from them. Contesting geopolitical alignments emerging within the Gulf and wider West Asia add another layer to India’s challenges. To illustrate, the UAE has gradually gravitated towards India and Israel via strategic and economic partnerships. Saudi Arabia continues to deepen its security linkages with Pakistan. Iran is critical to India’s continental connectivity with Afghanistan and Central Asia through the Chabahar Port.

This is where the limits of multi-alignment as an enabler of strategic autonomy are tested. India’s diplomatic agility is constrained by the structural reality of its energy dependence. India can’t consequentially shape the conflict militarily or economically, and remains susceptible to long lasting instability in the West Asian region. Even if India doesn’t pick sides, it still won’t be able to avoid bearing the brunt economically.

Balancing between rival camps

Over the past two decades, India’s West Asia policy has relied on parallel engagements with mutually hostile powers. India significantly warmed up economic and security ties with Saudi Arabia and the UAE among other Gulf countries, followed by the development of overt defence ties with Israel. India also deepened strategic relations with the US, while simultaneously pursuing stable relations with Iran in the face of Western sanctions and regional geopolitical tensions. During a periods of relative stability, this exemplification of multi-alignment provided India ample space for diplomatic manoeuvring. The war on Iran, however, has narrowed this space, straining India’s policy, and as a result, the exercise of strategic autonomy, considerably.

The recent BRICS Summit in New Delhi visibly highlighted these tensions. In his statements, Iranian Foreign Minister, Abbas Aragchi pushed for stronger BRICS condemnation of the US and Israel and later directly accused the UAE of being equally responsible for the attacks on Iran. The UAE didn’t support the use of language that could undermine its own ties with the US and Israel. Instead, it called for a condemnation of Iranian actions against the Gulf states. India, as the summit host, sought to avoid support for either position, emphasising de-escalation, maritime stability, and dialogue instead of condemnation. This was the second BRICS meeting in India since the beginning of the Iran war to end in an impasse and without a joint statement. While India tactfully avoided a bipartisan stance, this is also where its weight as a summit host ended.

India seeks to stay balanced as its relationships across West Asia are anchored in different strategic logics. Iran remains key for India’s gateway to Eurasia as Pakistan blocks India’s overland access westward. At the same time, India considers its relationship with Israel central to its defence and security architecture. Meanwhile, the US is India’s main strategic partner in the Indo-Pacific, especially when it comes to balancing China. India, for instance, is also part of the I2U2 (India, Israel, the UAE, and the US), a group aiming for cooperation on food and energy security. Any overt tilt towards either side, therefore, runs the risk of creating friction with the other. On the other hand, being multi-aligned during a hot conflict involving a great power tests the limits of this policy. 

The India-UAE partnership, rooted in economics and the Indian diaspora, has since expanded into defence cooperation, maritime security, logistics, and emerging technologies. In this backdrop, the partnership has converged with broader agreements such as the Abraham Accords. Connectivity projects such as the India-Middle East-Europe Economic Corridor (IMEC) symbolised this emerging synergy until the October 2023 attacks which led to Israel indiscriminately bombarding Gaza. After this, Israel, and by extension, the US, came into overt confrontation not just with Iran’s regional axis of resistance but with Iran itself. The region further descended into complete instability post the 28 February US-Israel operation, Epic Fury, against Iran this year.

Evolving intra-Gulf rivalries drawing from divergences in Saudi and UAE foreign policies, such as in Yemen, Sudan, and with Iran, have complicated matters further for India. Saudi Arabia represents a different strategic equation, although India-Saudi ties have substantially improved in recent years. Saudi’s defence ties with Pakistan, which include Pakistani military deployments in Saudi Arabia and strategic coordination, provides Riyadh with a security partnership that differs fundamentally from the UAE’s techno-commercial partnership with India. Such distinctions show that on the surface, the Gulf states have a unified geopolitical approach, but competing underlying silos with varying strategic preferences exist—even in terms of dealing with Iran and Israel. It creates an intersectional and complicated diplomatic challenge for India. New Delhi is not simply balancing between Iran and the US-Israel camps, but also navigating nuanced tensions within the Gulf order as well.

Managing trade disruptions

The fear of Iranian attacks and the US naval blockade of Iranian ports have disrupted maritime traffic through the Strait of Hormuz, one of the world’s most important energy corridors. For India, this presents a direct strategic vulnerability—it is the third-largest importer of crude oil, fourth-largest of LNG, and the second-largest importer of LPG in the world.  

Nearly 16 per cent of India’s aggregate trade is tied to Hormuz-linked countries: UAE, Saudi Arabia, Qatar, Kuwait, Iran, and Bahrain. Both India’s merchandise trade and critical energy imports depend on the Strait of Hormuz. India sources about 40 per cent crude oil, 50 per cent LNG, 93 per cent LPG, and a significant portion of agricultural fertilizers, which are essential for food production, via the strait. These impacts multiply the crisis situation for New Delhi. India depends on the entire Gulf energy ecosystem, and the war has left this system stunted not just in the form of transit disruptions but by the direct attacks on its infrastructure. Rising shipping insurance costs, tanker delays, and rapidly increasing crude prices have already begun exerting pressure on the Indian economy.

In recent years, India has ramped up maritime security as a strategic security priority due to its growing critical dependence on seaborne trade. New Delhi emphasises freedom of navigation and unimpeded maritime commerce due to real concerns about disruptions in energy supplies; they aren’t just esoteric principles of foreign policy. The Indian economy relies heavily on uninterrupted energy supplies from the Gulf. Prolonged turmoil would entail domestic implications in the form of supply issues, inflation, and pressure on currency.

India’s attempts to mitigate these risks through diversification strategies, including increased energy imports from Russia, Africa, and Latin America can’t sufficiently cushion the country’s strategic autonomy. Similarly, the recent India-UAE deal on increasing defence cooperation and building strategic oil reserves is being interpreted as a significant opportunity for India, in the backdrop of the UAE’s departure from the Organisation of the Petroleum Exporting Countries (OPEC). For India, this was an opening to strengthen its emergency oil supplies. That said, the deal can also be interpreted as a “tilt” towards not just the UAE but an Israel-led regional bloc even as its ability to substantially support India’s import diversification strategy remains unclear.

Nonetheless, geography continues to tether India’s economic future to the Gulf region. Even alternative suppliers remain vulnerable to rising global energy prices triggered by instability in West Asia. The same geography that India envisioned would serve as a bridge connecting South Asia to West Asia and Europe is increasingly becoming a theatre of overlapping military rivalries and geopolitical confrontation.

The war on Iran and its adverse ramifications have become a stress test for India’s multi-alignment policy. India is trying hard to maintain relations across a fractured regional order while protecting its energy, economic, and geopolitical interests. Although the current crisis demonstrates how India is working to balance between rival powers, this becomes increasingly difficult when those rivalries transform into direct military confrontation or zero-sum games. This is even more so when a super power is party to the conflict. So far, it looks like multi-alignment as an approach functions most effectively amidst manageable competition. If conflicts intensify and opposing camps harden, the political and economic costs of balancing rise sharply. India’s challenge in this intense situation is thus both about managing the contradictions created by simultaneous engagements with rivals and the narrowing space for continuing with such an approach due to the punishing material consequences.

Dr. Muneer Ahmed is Senior Researcher with IPCS’ Centre for Internal and Regional Security (IReS).