Amid reports that Iran is charging some ships $2 million to cross the Strait of Hormuz, India has taken a consistent stand calling for free and safe navigation through the waterway, which remains a sticking point in US-Iran talks set to be held in Pakistan.
Alaeddin Boroujerdi, a member of the Iranian parliament’s national security committee, told state broadcaster Islamic Republic of Iran Broadcasting (IRIB) that “collecting $2 million as transit fees from some vessels crossing the strait reflects Iran’s strength”.
The narrow waterway between Iran and Oman, which connects the Persian Gulf with the Arabian Sea, has become a critical maritime chokepoint for ships carrying oil, gas, and other commodities, ever since Tehran was attacked by the US and Israel on February 28. It usually carries a fifth of all the world’s global oil supplies from the oil-rich region around the Persian Gulf.
What India said
After a temporary ceasefire was reached earlier this week, the Indian foreign ministry has said there’s been “absolutely no discussion” on the issue of toll between India and Iran.
“Yes, we have also seen some reports [about toll being levied]… We continue to call for free and safe navigation through the Strait of Hormuz. We made this point in our statement yesterday as well and continue to do so now as well,” Ministry of External Affairs (MEA) spokesperson Randhir Jaiswal said on Thursday at the inter-ministerial press briefing on the West Asia crisis.
The reports of Iran charging a toll came up before the truce too, while India has been granted passage as a “friendly” country by Iran. But did India pay a toll too? New Delhi has been categorically denying that any such the payment was being made.
Jaiswal again said on April 9: “On the question of toll…there has been no discussion on this point between us and Iran. So that is where we are. As to what will be the scenario if a certain situation arises or happens in future, we’ll see when the time comes. But our point of view at this point in time is that we continue to call for free and safe navigation through the Strait of Hormuz.”
At least eight India-flagged LPG tankers have come through the route, while the government has been rationing usage, and rates on the grey market have spiked to up to four times normal.
India has high dependence on West Asia for its oil and gas supplies, up to 90% of which is imported, most of that via the Strait of Hormuz.
Effectively shut still
The strait remains effectively shut, as shipowners await clarification on its status. Traffic is still a fraction of pre-war levels, despite state media reporting that Iran’s Ports and Maritime Organization published two safe routes for shipping.
Straits are natural waterways, hence there is generally no transit charge for crossing them, as per the United Nations Convention on the Law of the Sea (UNCLOS). There are charges for man-made waterways like the Suez Canal and the Panama Canal.
But will the UNCLOS apply to Hormuz Strait? That question stands out as neither Iran nor the US have ratified the UN convention. Yet, both countries have mostly abided by it.
Iran’s 10-point proposal on stopping the latest West Asia war reportedly includes formalisation of its de facto control over the strait. Unnamed Iranian officials have told state media that, as part of the plan, Tehran would impose a toll of up to $2 million each on merchant ships passing through the strait.
But US President Donald Trump’s comments added to theories and confusion. “We’re thinking of doing it as a joint venture. It’s a way of securing it — also securing it from lots of other people,” Trump told ABC News said, when asked if he would “allow” Tehran to charge such a toll.
“It’s a beautiful thing,” the US President, who has repeatedly spoken in business terms about the war, added.
Does truce include Hormuz Strait?
The truce was reached on Wednesday just hours before Trump’s deadline for Iran to fully reopen the strait or face heavy destruction. Trump said that the truce was subject to Iran agreeing to “complete, immediate, and safe opening” of the Strait of Hormuz.
Iran’s foreign minister Abbas Araghchi said on Wednesday that safe passage through the strait will be possible for two weeks but “via coordination with Iran’s Armed Forces and with due consideration of technical limitations”.
This triggered reports that Iran and Oman will charge shipping fees. The EU said Thursday that freedom of navigation in the Strait of Hormuz must be ensured with “no payment or toll whatsoever”.
There is with little sign of complete normalcy also because Israel contiues to bomb Lebanon, fighting a parallel war against the Iran-aligned Hezbollah militia. Iran has said the US bears responsibility for halting the fighting there, while American officials insist the country wasn’t part of the ceasefire accord.
Trump has said Israeli PM Benjamin Netanyahu was “going to low-key it” with airstrikes on Lebanon, after the two leaders spoke by phone on Wednesday. Netanyahu later decided to open direct talks with Lebanon.
Pakistani PM Shehbaz Sharif, the key mediator, initially said the truce included Lebanon, before US and Israeli officials stated the opposite.
Iran’s new supreme leader, Mojtaba Khamenei, whose father was killed in the early days of the war, said in a statement on Telegram that Iran “will definitely bring the management of the Strait of Hormuz to a new stage”.
