Although New Delhi has sharply reduced its economic exposure to Iran over the years, trade with Teheran and the strategically important Chabahar port – through which India accesses Afghanistan to get around Pakistan – remain part of its calculations. Indian exports to Iran — including rice, tea and pharmaceuticals — could also face additional disruption as sanctions and the suspension of Dubai-based trade and financial transactions make payments and shipping more difficult.

The latest sanctions therefore risk aggravating a relationship already battered by disputes over tariffs, Russia and the Trump administration’s increasingly transactional approach to New Delhi, according to analysts. Evan Feigenbaum, a veteran Asia policymaker, captured the concern bluntly, saying the “one-two punch” of secondary sanctions would “further erode US-India relations,” which he said had “largely tanked during Trump’s second term.”

The asymmetry is striking when one factors in China. Washington is threatening India with the full force of secondary sanctions, yet when it comes to Beijing, which is Iran’s biggest oil customer, Washington remains feckless.

Although the administration has also sanctioned a substantial number of Chinese and Hong Kong-linked entities in its Iran crackdown, the scope of the action stops short of targeting China's major financial institutions or imposing the kind of sweeping country-level economic penalties that would risk a direct confrontation with Beijing because China possesses enormous leverage over the US through its dominance of rare earths and critical minerals. The result is an uncomfortable contrast: Washington can be fearsome toward countries with little capacity to retaliate, while becoming markedly more circumspect when confronting a great power with economic choke points of its own.

Indeed, Bessent conspicuously declined to name China when asked about major Iranian trading partners, saying that some discussions were better conducted privately. Iran, meanwhile, has dismissed the campaign as bluster.

Parliament Speaker Mohammad Bagher Ghalibaf said Washington was not in an economic position to further restrict Iran’s relations with other countries and claimed Tehran’s trading partners were not taking the American warnings seriously. Tehran has also threatened retaliation against countries that cooperate with Washington, while China has rejected unilateral US sanctions as ineffective and called for diplomacy.

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