Trump’s decree imposing 25% tariffs on any country doing business with Iran risks derailing the Sino-US trade talks, not to mention further worsening the economic situation inside Iran and therefore fueling more protests, but there’s another lesser-known but still significant consequence. That’s the way in which Pakistan stands to benefit from this move vis-à-vis its neighboring Afghan and Indian rivals, which stand to lose from it for related reasons, thus possibly expanding Pakistan’s regional influence as a result.
To explain, Trump’s social media post announcing his decision explicitly noted that it’s “Effective immediately…final and conclusive”, which suggests that there aren’t any loopholes or waivers. This is extremely concerning for both Afghanistan and India since the language makes it seem like Trump’s six-month sanctions waiver on India’s Chabahar Port in Iran that was supposed to expire in early spring, which is meant to facilitate its trade with Afghanistan and the Central Asian Republics, is no longer valid.
Accordingly, it’s been assessed by some that his latest tariff decree “puts pressure on Afghanistan’s trade” after it became much more reliant on Iran late last year upon the closure of the Pakistani border amidst their spiraling dispute, which could raise prices, shutter businesses, and risk unrest. If his new policy remains in effect long enough for some of that to happen, then the Taliban might request the resumption of trade with Pakistan, but the latter might demand some concessions in exchange.
The immediate trigger of their spiraling dispute concerns Pakistan’s claim that the Taliban patronizes fundamentalist “Tehreek-e-Taliban Pakistan” and separatist “Baloch Liberation Army” terrorists so it’s likely to demand tangible security guarantees for defending its frontier from infiltration. Similarly, Pakistan hopes for accelerated construction on a railway through Afghanistan to Central Asia, so it might demand related guarantees for ensuring this as well in order to expand its economic influence there.
Segueing into how Trump’s latest tariff decree could adversely affect India, some expect it to comply with his decision due to the cost-benefit calculation of retaining competitiveness in the massive American market in exchange for freezing the paltry 0.15% of its global trade that’s conducted with Iran. Nevertheless, any such decision could also effectively freeze its participation in the North-South Transport Corridor (NSTC) through Iran to Afghanistan and the Central Asian Republics via Chabahar.
That could in turn raise the odds that the aforesaid two redirect their global trade through Pakistan, with the Central Asian Republics pressuring the Taliban to normalize ties with Pakistan even if this requires some concessions to the latter, thus replacing India’s regional economic influence with Pakistan’s. The more economically dependent that they become on Pakistan, the more that Pakistan’s political and then military influence over them could expand too, which could have strategic implications for Russia.
If this sequence of events unfolds, which Russia could offset by ordering the emergency redirection of its humanitarian aid from Africa to Afghanistan to reduce pressure upon the Taliban to concede to Pakistan’s demands in exchange, then Indian and Russian influence in Central Asia might erode. While this wouldn’t directly affect India all that much, it could create strategic vulnerabilities for Russia that might then be creatively exploited by the West and Turkiye, possibly sowing the seeds of a future crisis.
