In a big relief for India, which is the third largest importer of crude oil in the world, US has exempted it from oil sanctions on Iran along with seven other countries.
After sanctions were re-imposed on Iran following the withdrawal of US from the nuclear deal, US Secretary of State Mike Pompeo said eight countries will be temporarily exempted from the ban on buying crude oil from Iran so as to not disrupt their energy needs.
The countries are China, India, Japan, South Korea, Taiwan, Italy, Greece and Turkey.
A surprise omission was Iraq, which was not granted a waiver because Iran could have bypassed sanctions by mixing its oil with its neighbour's output.
Speaking to the media, Pompeo said the objective of the sanctions is to starve the Iranians of funds which they use to sponsor violence throughout the region and around the world.
In May, US President Donald Trump withdrew from the deal which was signed by his predecessor Barack Obama after years of negotiations. Trump called the deal a failure as it only targeted Iran's nuclear programme and not its support for terrorism, including backing for the Lebanese militant organisation Hezbollah.
Pompeo also held out hope for a new agreement asking Iran to make 12 changes which he listed in May but he warned that if the country doesn't, the US will exert relentless pressure on the regime.
"The eight countries which have been exempted have already reduced imports on our request and out of these two have completely stopped importing oil and will not start imports till the sanctions remain in place. We will continue talking to the rest to bring oil imports to zero," Pompeo said.
The secretary of state also said three ongoing non-proliferation projects in Iran are exempt from sanctions.
However, US allies in Europe have strongly disagreed with Trump's decision saying the Iranians have been complying with the nuclear agreement and said they will find ways to bypass the sanctions to allow their companies to keep doing business with Iran.