US-Iran Peace Deal: Great For Short Term But Final Settlement Remains Out Of Sight
The US and Iran have announced that an understanding has been reached on the peace deal, sign the formal document on June 19 2026
Published : June 16, 2026 at 5:08 PM IST
Both the US and Iran have announced that an understanding has been reached on the peace deal between the two countries, and the document to formalise it will be signed in Geneva on Friday, the 19th of June 2026.
Full details of the 14-point agreement are not known. However, the media reports at hand suggest that the proposed MoU is likely to cover the permanent cessation of hostilities, lifting of the US blockade of the Hormuz Strait and its opening for free flow of commercial ships, lifting of sanctions on Iran and release of its frozen assets, grants of up to $300 billion for the reconstruction of war-damaged Iran, the size of the US military presence in the region and the key issue of Iran's nuclear program.
All of this is likely to happen in a phased manner. It is not clear whether the role of Iran's proxies (Hezbollah, Hamas and Houthis) or the so-called Axis of Resistance will find a place in the MoU.
The deal prima facie sounds too good to be true, as the US appears to have addressed almost all the demands made by Iran whereas it remains to be seen as to what Iran will accept on its nuclear programme in addition to what it had already agreed upon in Iran Nuclear Deal in 2015 between Iran and P5+1 (the US, UK, France, China, Russia, and Germany), out of which President Trump had walked out during his first term.
Perhaps Iran may agree to hand over to the IAEA approximately 440 kg of highly enriched uranium, which is close to weapons-grade enrichment. While the US is more or less euphoric about the deal, Iran is cautiously optimistic and guarded in its response.
The global leaders, including Prime Minister Narendra Modi, have welcomed the development and expressed hope that the deal would lead to peace and stability in the region and augur well for the global economy.
However, Israel’s response is a matter of concern and has raised doubts about the longevity of the peace deal and the prospects of a lasting peace in the region. Israel has made it clear that it is not a party to the deal.
The Israeli Defence Minister Katz said in a statement: "Prime Minister Benjamin Netanyahu and I are pursuing a clear policy under which the IDF will remain in the security zones in Lebanon, Syria and Gaza for an unlimited period of time in order to protect the border and Israeli communities from there against jihadist elements."
Over the past two and a half years, Israel is estimated to have taken control of areas in Gaza, Lebanon and Syria, amounting to 1,000 square kilometres of territory and is pursuing its dream of Greater Israel.
In all probability, we seem to be heading towards a situation when the US may withdraw from its direct conflict with Iran but may continue to extend moral and material support to Israel in the latter's pursuit of its ultimate objectives of neutralising Iran's proxies in its neighbourhood and weakening Iran to the extent possible, if not demolishing it.
The possibility of the US being dragged into the conflict cannot be ruled out altogether if the outcome of the mid-term elections in the USA in November this year goes in President Trump’s favour.
In any case, a permanent peace and stability in the region is not possible until and unless the UN-recommended two-state resolution is accepted and the Palestinians are given a sovereign homeland, obviating the need for Iran and its proxies' interventions against Israel. This unfortunately is nowhere on the agenda.
On the optimistic presumption that the deal will go through and the US and Iran will implement it in letter and spirit, one can say with some degree of confidence that the deal would help restoration of normalcy even if permanent peace may continue to be a distant dream. The global economy will stand to benefit immensely.
The lifting of sanctions on Iran's oil and resumption of energy supplies through the Strait of Hormuz would help stabilise oil prices and help arrest inflation. Since the announcement of the deal, crude oil prices have already come down and the share markets are registering upward trends.
From India's perspective, it will open up the possibility of resumption of energy supplies from Iran and revival of the Chabahar Port project in Iran, which in turn will provide a boost to India's connectivity with Afghanistan and Europe through Iran.
Maritime trade and the civil aviation industry are also bound to benefit. Unimpeded imports of fertilisers would be a relief for Indian agriculture. The expected stabilisation of crude oil prices will help reduce the outflow of foreign exchange and the lowered retail prices of petrol, diesel and gas will help arrest the inflation. Equally important is the safety and security of the 10 million strong Indian Diaspora in the Middle East who incidentally are a significant source of remittances in hard currency.
In short, the end of hostilities between the US and Iran, and an end to the disruptions in the supply chains and resultant smooth trade flows will augur well for the entire world even though a full and final settlement of the conflict remains out of sight.
(DISCLAIMER: The facts and opinions expressed in this article are those of the writer and do not reflect the views of ETV Bharat.)
Read More:
