An attack on an Israeli diplomatic vehicle today in New Delhi injured four, including the wife of an Israeli defense representative working at the embassy. The perpetrator reportedly used the same method of attack—detonating an explosive device that had been attached magnetically to the vehicle—that was used to assassinate an Iranian nuclear scientist in Tehran last month.

Israeli Prime Minister Benjamin Netanyahu directly blamed Iran for the attack, which raises the question of whether Israeli officials will increase pressure on India to curtail its ties with Iran. Despite toughening international sanctions against Iran for its continued pursuit of nuclear weapons, New Delhi is increasing oil imports from Iran and announced last week its plans to send a large trade delegation there.

The Indo–Israeli relationship has blossomed in recent years, mainly in the fields of defense trade and intelligence sharing. Israel has thus far avoided publicly questioning New Delhi over its ties with Tehran, even as Members of the U.S. Congress voiced numerous concerns about Iranian–Indian defense contacts, particularly during the height of the U.S.–India civil nuclear negotiations.

India relies on Iran for 12–15 percent of its oil needs and uses the Iranian port at Chahbahar to move its goods into Afghanistan, since Pakistan does not allow India to transit its territory. India and Iran worked closely in Afghanistan to counter the Taliban when it ruled Afghanistan from 1996 to 2001, and India likely calculates that it will need to reinstitute similar cooperation to protect its interests in the region when the U.S. withdraws its forces.

India has worked hard to try to balance its burgeoning strategic partnership with the U.S. with its traditionally close relations with Iran. India has voted against Iran in three crucial votes at International Atomic Energy Agency meetings over the past six years. It also snapped negotiations over an Iran–Pakistan–India energy pipeline under pressure from the U.S.

More recently, however, India has been reluctant to reduce trade ties to Iran and appears to be trying to recoup some of the ground it lost in its diplomatic relations with Iran over the last several years. Indeed, New Delhi increased its imports of Iranian oil from December to January by over 37 percent. India is also negotiating barter-type oil arrangements with Iran to skirt international sanctions, including using an Indian bank to provide rupee payments to Indian companies exporting goods to Iran. Iran is apparently willing to accept rupees instead of dollars for nearly half of the $11 billion worth of oil that India buys from Iran annually.

India will find it increasingly difficult to placate both Iran on the one hand and the U.S. and Israel on the other. Now that Israeli diplomats have been targeted in New Delhi, it will be increasingly difficult for Indian officials to sweep under the carpet their growing trade relations with Tehran. India will have to seriously factor the costs of oil trade with Iran to its rapidly growing defense partnership with Israel. In the coming months, India and Israel are expected to sign a number of military contracts involving co-production and sophisticated Israeli technologies.

The skills of Indian strategists who seek to balance India’s role as a growing global power with its need to guard against the prospect of rising regional instability will be tested in coming months as the international confrontation with Iran intensifies.

While the U.S. should continue to press India to stay in step with the international sanctions regime against Iran, U.S. officials should also be more sensitive to India’s concerns about Afghanistan. U.S. officials should reassure their Indian counterparts that Washington will remain engaged with Afghanistan diplomatically, financially, and even militarily to some degree long after 2014, when the U.S. combat mission is set to expire. Washington should also quell any suspicions that it is getting ready to strike a deal with the Taliban that would embolden extremists in the region and sacrifice the hard-won social gains made over the last decade.