Iran Protests – Causes & Consequences – Explained Pointwise

Iran has plunged into another crisis. What began as a localised strike by shopkeepers in Tehran’s Grand Bazaar on December 28 has now snowballed into the largest uprising against the Islamic Republic since 1979 Revolution that toppled the Shah regime & brought the Islamic regime to power. The severe repression by the security forces against the protestors has led to killing of over 2500 people. The US President has warned Iran that the US may take military action over the killing of peaceful protestors. The Indian government has also issued the advisory to Indians in Iran to leave the country immediately.

What are the reasons behind the protests?

What has been the response by major players/stakeholders?

1. Iranian Government: 
   • Official Narrative: State media and officials consistently label protests as “riots” instigated by “foreign enemies” (primarily the U.S., Israel, and Saudi Arabia) to undermine national security and stability.
   • Security Response: Deployment of security forces (IRGC, Police), mass arrests, internet shutdowns, and harsh judicial measures (including death sentences for some protesters).
2. Iranian Civil Society & Protestors:
   • Sustained Resistance: Despite crackdowns, sporadic protests continue, often adapting to tactics like nighttime chanting, graffiti, and strikes.
   • Broadened Demands: Initial triggers (e.g., hijab enforcement, economic woes) have evolved into calls for systemic change, with slogans like “Woman, Life, Freedom” and explicit rejection of the Supreme Leader.
3. International Actors:
   • United States: Trump has issued a series of “MIGA” (Make Iran Great Again) warnings, stating that if the regime hangs protesters, the U.S. will “come to their rescue.” The U.S. has threatened a 25% tariff on any country that continues to do business with Iran.
   • Russia: Backed Iranian government, blaming the West for destabilization. Strengthened military and economic ties with Tehran amid Ukraine war isolation.

4. United Nations: Independent fact-finding missions established by the Human Rights Council to investigate violations.

What could be the impact of the crisis on the region?

1. Economic Disruptions: The region is critical to global energy (Iran produces 4% of global demand), food, or trade routes (e.g., the Strait of Hormuz (20% of global supply passes through the Strait), Suez Canal), disruptions can spike prices and cause shortages worldwide. Economic collapse can exacerbate poverty, unemployment, and inequality.
2. Escalation of Proxy Wars: Iran supports non-state actors across the region (e.g., Hezbollah in Lebanon, Houthis in Yemen, Shia militias in Iraq/Syria). Internal instability or a shift in Iran’s foreign policy could either reduce support (if Iran turns inward) or increase aggression (if hardliners escalate to project strength).
3. Regional rivals’ actions: Saudi Arabia, Israel, and the UAE could see an opportunity to weaken Iran’s strategic position, potentially increasing covert or diplomatic pressure.
4. Refugee Crisis: If violent repression occurs, increased refugee movements could affect neighboring Turkey, Pakistan, Afghanistan, and Iraq.
5. Ideological Ripple Effects: Successful protest movements in Iran could inspire reformists or opposition groups in other regional states, especially where youth frustration and economic grievances are high. Conversely, a harsh crackdown might demoralize democracy movements elsewhere, showing the difficulty of challenging entrenched authoritarian systems.

What could be the consequences of the crisis on India or Indian interests in the region?

1. Chabahar Port: Chabahar is India’s most critical strategic asset in the region, serving as a bypass to Pakistan for trade with Afghanistan and Central Asia. While India secured a 10-year agreement for the Shahid Beheshti terminal in 2024, the U.S. recently revoked a long-standing sanctions exception. India is currently operating on a temporary waiver valid only until April 2026.
2. Trade Disruptions: Iran has historically been one of India’s top markets for agricultural exports, but this trade is currently in a state of suspension. The collapse of the Iranian Rial has made it impossible for Iranian importers to honor contracts. Over ₹2,000 crore in dues to Indian Basmati exporters are currently stuck.
3. Energy Security & Inflation: India has not imported Iranian oil since 2019, but the regional crisis still impacts its energy bill. Instability in the Strait of Hormuz (a chokepoint for 20% of global oil) has led to price volatility. For every $10 increase in oil prices, India’s current account deficit typically widens by billions, driving up domestic fuel costs and inflation.
4. Safety of Indian Diaspora: Escalation could fuel proxy wars in the region, affecting Indian expatriate communities (≈8 million in the Gulf), and raising security concerns for India. India has issued a “Strong Leave Now” advisory for its 10,000+ citizens in Iran (mostly students and pilgrims). 
5. Afghanistan Impact: Iran is a key player in Afghanistan. Instability could spill over, affecting India’s interests in Afghan stability and development projects.
6. Terrorism & Radicalization: Regional unrest could embolden extremist groups, potentially affecting India’s internal security, especially in Kashmir.
7. Balancing Act: India maintains relations with Iran, Israel, Saudi Arabia, and the U.S. A crisis would force difficult diplomatic balancing, especially if pressured to choose sides. If the crisis involves U.S.-Iran tensions, India may face secondary sanctions pressure, complicating energy and trade ties with Iran.
8. China’s Role: China’s influence in Iran (via Belt and Road Initiative, strategic partnerships) could grow during a crisis, potentially marginalizing India’s regional role.