Eastern approaches

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Eastern approaches

As tensions mount between Iran and the west over the Islamic state's nuclear ambitions, Tehran seems to be adopting an Ostpolitik, looking to China and India for political and energy ties. Opec's second-largest oil producer, which also has the world's second-biggest gas reserves, is wooing Asia's fast-growing and energy-hungry economies.

The courtship started with two big deals for long-term exports of liquefied natural gas to China and India. And there are bigger plans afoot with New Delhi, involving an export pipeline via Pakistan. The problem is that Washington does not want the deal to go ahead while Tehran is on the brink of joining the world's nuclear club.

Only days after hardliner Mahmoud Ahmadinejad took office as Iran's new president, the country restarted its uranium conversion activities in the central city of Isfahan in defiance of European requests to keep the operation suspended.

But analysts believe growing economic ties between Iran and the two Asian superpowers could thwart a unanimous decision against Iran in the UN.

At the same time, analysts expect Iran's new conservative government to strike more deals with Asian powers. Bijan Khadjehpour, chairman of consultancy Atieh Group, says: "western companies would realize that there are a number of Asian competitors such as the Chinese and Indians that are happy to take their places in Iranian business."

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