Who has the right to set the rules of global trade?

Sanctions on Iran: When economic power becomes a tool of political subjugation
What is happening today between the United States and Iran goes far beyond the dispute over Tehran’s nuclear programme or its regional behavior. At its core, we are witnessing a broader confrontation over who has the right to determine the rules of economic engagement in the international system, and to what extent a single power can use its financial superiority to impose its choices on other sovereign States.
In recent days, Washington has escalated what it describes as a broad economic campaign against Iran, targeting dozens of individuals, entities and vessels, while expanding pressure to include the oil, shipping, technology, gold and cryptocurrency sectors. 

At the same time, Washington has threatened Iran’s trading partners with secondary sanctions if they continue doing business with Tehran. This is precisely where the problem begins to go beyond Iran.
The United States, like any other country, has the right to take measures against entities under its jurisdiction or those it considers a threat to its national security. 

But the question becomes fundamentally different when Washington tells a third country that is not subject to US law: “If you do business with Iran, we will punish you too.”
At that point, sanctions cease to be merely an American instrument directed at Iran and become a mechanism for forcing third parties to adopt American policy.
This is the essence of what are known as secondary or extraterritorial sanctions. Their real power does not come solely from the size of the American economy, but from Washington’s ability to control access to the dollar, the international financial system and US markets.

The message then becomes clear: “You may be a sovereign state, but you cannot make an independent economic decision if it conflicts with American policy.”
The question, therefore, is no longer simply: Does Iran deserve sanctions or not? The more important question is: Can one power make its foreign policy a binding standard for the rest of the world?

The position here must be clear. Rejecting unilateral sanctions does not mean endorsing Iranian policy, just as rejecting Iranian threats against neighboring states does not mean accepting American coercion. The 2017 Qatar crisis provides an important example of how geography and economics can be used in regional conflicts. When Qatar was subjected to a blockade by Saudi Arabia, the UAE, Bahrain and Egypt, Iran did not join the blockade. Instead, it opened its airspace to Qatari aircraft and helped provide alternative routes for supplies and trade, taking advantage of its geographic position. 

At the same time, the crisis encouraged Doha to diversify its economic and political relationships with Turkey, Iran and others.
What Washington wants has become increasingly clear. The issue is no longer limited to using sanctions to force Iran to abandon its political, regional and economic choices. It goes further, turning sanctions into a tool for creating a chronic regional crisis by pushing neighboring states, directly or indirectly, to participate in pressure against Tehran and confront it.

Thus, we move from the stated objective of preventing nuclear proliferation to a broader attempt to reshape the behavior of an entire state-and even to redesign the regional environment surrounding it-by using economic power as an instrument of political subjugation.

The United States does not necessarily need to deploy military forces everywhere to impose its will. The power of the dollar, the banking system, American markets, insurance and shipping networks, and technology gives Washington enormous influence over the decisions of countries far beyond its borders. The financial system itself therefore becomes an instrument of foreign policy. This also explains why American sanctions on Iran have become an issue extending far beyond Washington and Tehran. China, the largest buyer of Iranian oil, is at the centre of the equation, while companies and entities across Asia and the Middle East face increasing pressure.

The real question for the future, therefore, is not simply whether Iran will withstand the pressure. It is: How long will the world accept the transformation of American financial power into a global licensing system determining who is allowed to trade with whom?

And this is where the importance of multipolarity becomes evident. China has emerged as a major economic power. India is pursuing a policy of strategic autonomy. Russia is seeking to reduce its dependence on the Western financial system. 

Gulf states are diversifying their partnerships, while countries across the Global South are looking for payment and trading mechanisms less vulnerable to external sanctions.
This does not mean that the dollar will lose its dominant position anytime soon, nor does it mean that the United States will lose its influence.

But the excessive use of economic power may produce the opposite result: encouraging states to search for alternatives.
Sanctions therefore become a double-edged sword. They may weaken the targeted state in the short term, but at the same time they may encourage the creation of alternative trade and financial networks in the long term.
India has no interest in joining a policy of “either you are with us or against us.”

India needs stable relations with the United States, but it also needs Iran, the Gulf and Central Asia. It has strategic interests in Chabahar and in connectivity, trade and energy corridors.

Therefore, the most balanced Indian position should rest on three principles: compliance with legally binding international sanctions; rejection of unilateral sanctions with extraterritorial effects; and preservation of India’s independent decision-making in trade, energy and regional connectivity.

This is neither a policy in support of Iran nor a policy against America. It is a policy of defending Indian strategic autonomy.

The problem is that both Washington and Tehran fall into the same trap, but through different instruments. Washington tells countries: “Do not help Iran, or you will pay the price.”
Tehran tells countries: “Do not help America suffocate Iran, or you will pay the price.”

The neighborhood therefore finds itself caught between two forms of coercion: American economic coercion and Iranian security coercion.This is not a recipe for stability. It is a recipe for expanding the circle of conflict.
The solution is not for countries to choose between Washington and Tehran. It lies in restoring a simple principle that is too often ignored in international politics:

A sovereign state has the right to choose its political and commercial partners, unless it is bound by legally binding international obligations that prohibit such engagement.
If the United States wants to prevent Iran from developing military nuclear capabilities, it should use diplomacy, international monitoring and guarantees.

If Iran wants its neighbors to refrain from participating in American sanctions, it should use trade, diplomacy and incentives-not threats.
Turning the economy into a weapon, geography into an instrument of blackmail, and sovereignty into a bargaining chip will not produce a stable regional order.

Our rejection of unilateral American policy does not mean support for Iran. Likewise, our rejection of Iranian threats against neighboring states does not mean justification for American sanctions.The principle must be the same: economic power should not be transformed into an instrument for forcing sovereign states to adopt another country’s policy.

If Washington wants to confront Iran, it should do so through international law and negotiation, not by forcing countries around the world to choose between trading with Iran and retaining access to the American financial system.Iran, for its part, cannot demand that its neighbours respect its sovereignty and then threaten them when they make decisions it dislikes.
The objective is not to choose a side, but to defend sovereignty and reject coercion from whichever side it comes.

The BRICS Test
As we await the outcome of next month’s BRICS summit in New Delhi, a gathering of strategic rivals, the grouping will face a genuine test of its ability to build common ground for a multipolar international order. The central question will be: Will multipolarity simply mean a transition from the dominance of one power to a world of multiple powers capable of imposing their willor will it create a more balanced system that protects the right of states to choose their own political and economic paths without being punished or threatened simply because they have chosen a different one?

The success of BRICS will not be measured by its ability to confront Washington, nor by its proximity to Tehran, Beijing or Moscow. It will be measured by its ability to demonstrate that multipolarity means multiple centers of decision-making-not multiple centers of coercion.

The author is senior journalist and West Asia strategist