The U.S. State Department says it is exempting Iran's big port project in Chabahar from sanctions in recognition of its importance to landlocked Afghanistan.
The sanctions, however, threatened India's ability to obtain financing for the development of Chabahar, which could potentially open the way for millions of dollars of trade for land-locked Afghanistan and end its dependence on Pakistan's port of Karachi.
Meanwhile, US ambassador to Afghanistan John Bass said the US has, after extensive consideration, provided an exception under the Iran Freedom and Counter-Proliferation Act.
However, Secretary of State Mike Pompeo said that eight countries - India, China, Italy, Greece, Japan, South Korea, Taiwan and Turkey - were temporarily allowed to continue buying Iranian oil as they showed "significant reduction" in oil purchase from the Persian Gulf country. "These activities are vital for the ongoing support of Afghanistan's growth and humanitarian relief", said the US State Department Spokesperson.
Iran late past year inaugurated the port on the Indian Ocean, which is being built largely by India and is expected to provide a key supply route for Afghanistan while allowing India to bypass rival Pakistan to trade with Central Asia and Africa.
Sisi made the statement a day after a new batch of United States anti-Iranian sanctions, targeting the Islamic Republic's oil trade as well as shipping and banking, came into force.More news: Dead Nevada brothel owner wins US election
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Zahedan is also in Iran but closer to the Afghanistan border. It states that India has a major role in bringing peace and development in Afghanistan.
The foreign minister further stated that while previous US Presidents have also displayed "disrespectful attitudes" towards Iran, they have eventually changed their stance, and said the Trump administration will have to do the same.
"Trump administration made the right move by exempting India for the development of the Chabahar port", Jeff Smith of the Heritage Foundation told PTI.
New Delhi has poured $2 billion into development in Afghanistan since the 2001 US -led overthrow of the Taliban government.
Any return to limiting supply would follow a June decision by the OPEC-led group to relax output curbs in place since 2017, after pressure from U.S. President Donald Trump to cool prices and make up for losses from Iran. It understands India's national security interests. It sees the Chabahar port as a key way of both sending supplies to Afghanistan and stepping up trade with Central Asia and Africa.
Oil rose as OPEC and its allies were said to plan talks on fresh production cuts next year, responding to recent increases in crude inventories amid surging USA supply.