India is poised to maintain its traditional stance of neutrality as tensions between Iran and Israel continue to escalate, avoiding any direct alignment with either side. The South Asian power, which shares strategic interests with both Middle Eastern nations, is unlikely to compromise its carefully cultivated relationships in a region critical to its energy security and diaspora dynamics.

New Delhi’s approach is shaped by its long-standing policy of strategic autonomy, under which it refrains from entangling alliances while balancing competing geopolitical interests. This framework allows India to engage pragmatically with countries that are often adversaries of each other, including the US and Russia in one part of the world, and Shiite Iran and Syria against Sunni Arab countries like Saudi Arabia and the majority Jewish state of Israel in another.

Despite its ties with Israel, India officially supports a two state solution to the Israel-Palestine conflict, including hosting both a Palestinian and an Israeli embassy in New Delhi. The current regional turbulence is unlikely to compel a departure from this established foreign policy posture.

India's ties with Iran have deep historical and civilisational roots, reinforced by shared interests in connectivity projects, trade, and regional security. The Chabahar Port project, a key element of India’s connectivity strategy to Afghanistan and Central Asia, remains a cornerstone of bilateral cooperation.

Additionally, Iran’s vast reserves of oil and natural gas continue to attract Indian interest, despite sanctions-related complications. While Indian imports of Iranian crude have dwindled significantly since 2019 following US pressure and threat of secondary sanctions, New Delhi still views Iran as a long-term energy partner.

Simultaneously, India’s relationship with Israel has deepened across defence, technology, and intelligence domains. Israeli firms have become key suppliers of military hardware to India, particularly in areas like missile systems, drones, and border surveillance technologies.

Moreover, cooperation in agriculture, water management, and cybersecurity has created a multifaceted partnership that transcends traditional security ties.

The Indian government is acutely aware that overt support for either Tehran or Jerusalem risks jeopardising crucial national interests.

Endorsing Israel too strongly could alienate Iran, undermining connectivity projects and reducing future energy options. Conversely, backing Iran would not only strain ties with Israel but also damage relations with the US and its Group of Seven(G7) allies - partners India considers essential for its economic and strategic objectives. A significant portion of India’s geopolitical balancing act is shaped by its energy dependence on the Gulf.

The broader Middle East supplies nearly 60% of India’s crude oil, and any disruption to this flow due to escalating hostilities between Iran and Israel could destabilise India’s macroeconomic framework. Volatility in oil prices driven by military action or the closure of strategic choke-points like the Strait of Hormuz would place immense pressure on India’s import bill and inflationary outlook.

India also faces a major demographic consideration. With over 9mn Indian nationals residing in Gulf countries, the safety and well-being of its diaspora is a top priority for policymakers. This compels India to pursue a conflict-neutral stance that prioritises de-escalation and regional stability. Or, in case of conflict, launch major evacuation operations for its nationals. India’s posture is also consistent with its broader trend of non-alignment in contemporary conflicts.

The Ukraine war has showcased New Delhi’s preference for issue-based partnerships over bloc politics. In the case of Iran and Israel, this translates into a deliberate distancing from taking sides in order to preserve flexibility and leverage across multiple theatres.

Defence cooperation with Israel is expected to proceed unimpeded despite the ongoing tensions. Israeli military technologies are integral to India’s modernisation drive, and several key projects are already in advanced stages of execution.

These include air defence systems like the Barak-8 Surface to Air Missiles, Unmanned Aerial Vehicle and counter-drone technologies. Indian firms are also expanding collaboration with Israeli start-ups in the dual-use tech and surveillance domains.

Conversely, India is expected to continue exploring avenues for economic engagement with Iran, particularly in the infrastructure and transit sectors. The operationalisation of the Chabahar Port underlines New Delhi’s intent to stay invested in long-term connectivity plans that bypass Pakistan. While Western sanctions may inhibit large-scale investments, India is likely to exploit exemptions and legal loopholes to maintain a presence in Iranian logistics projects.

The Iranian nuclear issue further complicates India’s calculus.

While New Delhi supports non-proliferation, it does not favour unilateral military solutions. A full-scale Israeli strike on Iranian nuclear facilities could lead to regional chaos and spike oil prices, directly hurting Indian economic interests.

In such a scenario, India would likely push for multilateral diplomacy through forums like the UN rather than endorsing any armed intervention. India’s neutral posture also enhances its appeal as a reliable interlocutor in a divided global landscape.

As countries in the Global South increasingly seek to assert agency in world affairs, India’s example of balanced diplomacy offers a potential model. The current conflict underscores how non-alignment, once seen as outdated, is being repurposed to navigate a multipolar and volatile international system.