India-Iran ties have been termed an "axis," a "strategic partnership" and even an "alliance." However, the American focus on India-Iran ties has been highly disproportionate to the realities of this relationship, a result more of the exigencies of domestic politics than of regional political realities.

Until recently, when the choice emerged between Iran and the U.S., India would side with the U.S. But the Obama administration's callous attitude toward India is pushing India toward Iran, and that could have grave geopolitical consequences. Ignoring Washington, India recently signed several agreements with Iran, including an air services agreement and a memorandum of understanding on new and renewable energy aimed at increasing trade from $15 billion to $30 billion.

Economic cooperation in priority areas such as oil, gas, petrochemicals, pharmaceuticals and textiles is key to this endeavor. Plans are afoot for greater maritime cooperation; Iran has already joined the Indian Navy's annual initiative, the Indian Ocean Naval Symposium. Moreover, the two sides have decided to hold "structured and regular consultations" on the issue of Afghanistan.

America's Afghanistan policy has caused consternation in Indian policymaking circles. A fundamental disconnect has emerged between U.S. and Indian interests with regard to Af-Pak. The Obama administration has systematically ignored Indian interests in crafting its Af-Pak priorities. While actively discouraging India from assuming a higher profile in Afghanistan, for fear of offending Pakistan, the U.S. has failed to persuade Pakistan to take Indian concerns more seriously.

While the U.S. may have no vital interest in determining who actually governs in Afghanistan — so long as Afghan territory is not used to launch attacks on U.S. soil — India does. The Taliban — good or bad — oppose India in fundamental ways. The consequence of abandoning the goal of establishing a functioning Afghan state and a moderate Pakistan will be greater pressure on Indian security. To preserve its interests in this milieu, India is now coordinating more closely with states like Russia and Iran.

During Russian President Vladimir Putin's visit earlier this year, India sought Russian support in countering what it views as a U.S.-Pakistan axis in Afghanistan. India is making a concerted move to reach out to Tehran.

India's deputy national security adviser, Alok Prasad, was in Iran a few weeks back trying to seek Iranian support in stabilizing the rapidly deteriorating situation in Afghanistan. Indian Foreign Minister S.M. Krishna, too, has held discussions with his Iranian counterpart, especially concerning the West's plans for reintegrating "good Taliban" gathers momentum.

Over the last several years, India has repeatedly voted in favor of International Atomic Energy Agency resolutions condemning Iran's nuclear behavior. Though the Indian prime minister has been categorical in asserting that a nuclear Iran is not in Indian interests, the Indian government has been keen in recent months to emphasize that it favors dialogue and diplomacy as means of resolving the Iranian nuclear crisis. India has underlined that unilateral sanctions on Iran will hurt India, including sanctions by individual countries that restrict investments by third countries in Iran's energy sector. As Indian Foreign Secretary Nirupama Rao recently made clear, India is "justifiably concerned that the extra-territorial nature of certain unilateral sanctions recently imposed by individual countries, with their restrictions on investment by third countries in Iran's energy sector, can have a direct and adverse impact on Indian companies and more importantly, on our [India's] energy security and our attempts to meet the development needs of our people."

The Iran-Pakistan-India pipeline project has also been on the agenda as India remains keen to gain access to Iranian energy resources. Not only has Pakistan signed the deal with Iran, China is starting to make its presence felt in Iran in a big way. It is now Iran's largest trading partner and is undertaking massive investments in Iran, rapidly occupying the space vacated by western companies.

India is right to feel restless about its marginalization with respect to Iran despite civilizational ties with the country. The problems with the IPI pipeline remain difficult to overcome. India has differences over the pricing of the gas even as ensuring the security of the pipeline in restive Balochistan makes it difficult for India to accept the deal in its present version.

Though problems remain in India-Iran relations, the latest overtures by New Delhi toward Tehran underscore the importance that India attaches to ties with Iran. That this is happening at a time when there has been a significant cooling of U.S.-India ties makes it even more significant. With the Obama administration's credibility in India at an all-time low, New Delhi is left with few options, which include engaging with states that Washington doesn't like.