The Indo-Iranian relationship has to be perceived from the lens of a changing world-dynamic, where the United States of America shared a bilateral relationship with Iran. The former had supplied military equipment in exchange for hard currency. This oil crisis that occurred due to the Arab-Israel War of 1973 paved the way for the development of economic ties with Tehran. India was not able to withstand the soaring prices of oil, her economy was deteriorating, Iran agreed to supply crude oil at a subsidized rate.
1969, therefore, has been termed as a watershed when Mohammad Reza Shah Pahlavi visited New Delhi to establish an Indo-Iran Joint Commission for Trade, Economic as well as Technical Co-operation. It was the economic sphere that saw the crystallization of such a relationship with Indian exports soaring up to Rs.102 million in 1967-68 and Rs. 214.6 million during 1968-69. 
However, in 1971, Iran emerged as a protector of the Persian Gulf littoral when she occupied Abu Musa and the Greater and Lesser Tumbs with the United States strengthening her strategic linkage and reinforcing this deed. India developed a strategic relationship with the Soviet Union as she needed her support if Pakistan attacked that led India to take such a drastic move. India ‘s aspiration to become an Indian Ocean power counters Shah’s ambition of the same.
Relationships strained between New Delhi and Tehran as Pakistan propaganda talked of a looming Indian threat in the Pakistan residual state, increasing Iran’s anxiety about its vulnerability. Nonetheless, both Pakistan and Iran shared a Baluchi population, therefore any incitement to the Baluchi movement would have repercussions for Iran as well. As a result, the activities of the Baluchi insurgents was curbed as well as the National Awami Party were abolished. Nonetheless, Richard Nixon’s abutment of Pakistan in the 1971 war made India believe that Iran was not independent of its actions and was interpreted as a conduit for America’s own self-interests. 
The importance of the Tehran Declaration signed by Atal Bihari Vajpayee and Iran’s former President, Muhammad Khatami, laid the foundation for mutual cooperation between these two emerging global powers, focused mainly on energy and commercial concerns and the will and commitment to developing the North-South transport corridor for the movement of goods through Central Asia, Russia and Northern Europe.
It was in 2003 that the New Delhi Declaration was signed, which witnessed the development of the Chabahar route through Melak, Zaranj and Delaram, the key signatories being Afghanistan, Iran and India. This not only opened an alternate route for Afghanistan to the Iranian port but reduced the dependency of the former on Pakistan for trade. The Memorandums of Understanding signed in Tehran declared the construction of warship repair facilities at the port of Chabahar as well as consigning Indian engineers to Iran for the maintenance of T-72 Tanks. 
The repetition of a strenuous relationship between India and Iran occurred during 2005 when the former had voted against the latter at the International Atomic Energy Agency (IAEA). The warship program deployed in the Persian Gulf was a turning point as India negotiated with Oman and UAE, retreating from the Iran-Pakistan-India gas pipeline project. Nonetheless, India held Iran accountable due to its obligations under the Non-Proliferation Treaty (NPT), IAEA and United Nations Security Council guidelines, insisting Iran to address these significant issues for the satisfaction of the International community.
Her relationship with the world’s superpower, USA was well aware of the substantial gains in Iran, in terms of military ties, counter-terrorism and the defence trade that expounded to 3 billion worth. The economic sanctions, on the other hand, would have its impact on the energy security and trade relations which makes India conscious of her equities in with Iran.
According to Jassep de Hoop, Iran has the prowess to handle Pakistan’s instability. India has cooperated with Iran on upgrading Russia- supplied weapon system as well as in military equipment and spare parts, with Iran allowing India to access to its military bases in the event of war with Pakistan. This would indeed have implications in the alteration of regional relations in favour of India, as opined by Sujata Aishwarya Cheema.
However, due to the changing contours of foreign policy after Donald Trump’s victory, has antagonized relations between both the USA and Iran. Trump continues to be a critique of the nuclear deal, accusing Iran of harming the former’s interests in the Middle East, opining her as a state that harnesses terrorism. The Joint Comprehensive Plan of Action has ruthlessly been critiqued as it allowed Iran to acquire nuclear weapon capability. The aim of signing the deal had been to restrict Iran’s nuclear enrichment activities. USA does not wish to renew the SRE(s), implying that India must stop buying oil from Iran.
It was in 2010 that the Foreign Secretary of India, Nirupama Rao in a speech stated the disapproval of New Delhi in the imposition of additional sanctions by individual countries against the Islamic Republic’s energy sector. Such a stance reasserted India’s intent of continuing her bilateral relations irrespective of the détente that USA and Iran possess. The visit of the Iranian Prime Minister, Javad Zarif to discuss with the External Foreign Minister of India, Sushma Swaraj is of immense significance as Iran aimed to convince India of the scope of continuing business with her. The USA-Iran relationship will also have its bearing on India as she oscillates between both these countries who are of strategic importance.
However, Iran has recently declared that it does not wish to engage with India anymore in the establishment of the Chabahar port that is a direct linkage to Afghanistan. It has been stated that India had invested an amount of $150 million in the Chabahar project in the last 10 years as she believed that the diplomatic relationship between her and Iran would flourish. Sino- Indian relationship has deteriorated after China violated the Line of Actual Control in Galwan Valley.
It has resulted in contestation for influence over the Middle East, whereby Iran has decided to enter into an entente with China as the Comprehensive Strategic Partnership highlights. This partnership can be regarded as a deal-breaker for China as she would now be able to receive oil from Iran. Her stronghold over Iran has only strengthened after the signing of the Comprehensive Strategic Partnership, the ground of which was laid in 2016 by President Xi Jinping.
India’s objective is to be recognized as a global power with a decisive voice in international affairs. To her, consolidating her presence in Afghanistan and Central Asia are necessary, with Tehran playing a pivotal role in this endeavour. Loss of hold over the Persian Gulf will only jeopardize New Delhi’s foreign policy in South-West Asia.