India, June 17 -- After weeks of suspense, both the US and Iran announced over the past couple of days that a peace agreement had been reached. US President Donald Trump wanted it to be signed on Sunday to coincide with his 80th birthday. It will now be signed on Friday in Geneva. There was some last-minute drama before the agreement was reached - Israel bombed Dahiya, a Beirut suburb, which amounted to crossing an Iranian red line. Tehran regards the ceasefire in Lebanon as linked to its ceasefire with the US. The Israeli action was criticised by Trump, who described Prime Minister Benjamin Netanyahu as a "very difficult guy". The prospect of reopening the Strait of Hormuz has cheered the markets. The Brent crude benchmark fell by 4.67% to $83.25 per barrel. The war had heavy costs for India - from sharp increases in crude oil, urea, and LPG prices to three Indian sailors being killed by the US Navy, which claimed it was enforcing its blockade against Iran. The proposed agreement envisages a two-stage process. In the first stage, Iran will lift its restrictions on the Strait of Hormuz while the US will end the blockade of Iranian ports. The nuclear issue and lifting of US sanctions against Iran will be discussed during the 60-day period leading up to the second stage. There are other subjects, including unfreezing of Iranian funds and payment of reparation money. These negotiations will by no means be easy. But a reopening of Hormuz will bring relief to the international community, Iran, as well as the Gulf States, who have been unable to export their oil and LNG for longer than Iran. The US wants Iran to hand over its pile of highly enriched uranium. Iran is ready to down-blend it to fuel, but is not willing to export it to the US. The US would like Iran to accept zero enrichment. Iran is willing to concede on zero inventory, but wants to retain enrichment rights within the threshold allowed under the Non-Proliferation Treaty (NPT). The two sides will have to work out inspection arrangements. Iran would like the US primary, as well as secondary sanctions, to be lifted. The long war has weakened American influence in the Gulf, where it was the hegemon since President Roosevelt and King Abdul-Aziz (ibn Saud) reached the "oil for security" understanding in February 1945. Trump tried both force and diplomacy to reopen the Strait of Hormuz. Neither worked, and eventually, the US had to negotiate with Iran. Trump announced Project Freedom to forcibly open the strait on May 3. Iran retaliated with an attack on US naval ships and the Fujairah terminal in the UAE. Within 36 hours, Trump had to press pause. Trump tried to enlist Chinese President Xi Jinping's help during the US-China summit. As the largest buyer of Iranian crude oil, China has the clout to influence Tehran. The increased oil and gas prices also hurt the Chinese economy. It imports 11 million barrels per day of crude oil globally. But China has larger political considerations. Beijing would not move without substantial concessions on Taiwan. If the war were to go on any longer, US influence in the Gulf will further diminish. The Gulf monarchies will start looking for alternatives if an alliance with the US does not protect them from Iranian retaliation, and closure of the Strait of Hormuz throttles the oil and LNG exports vital to their economies. The US's entanglement in "forever wars" in West Asia will leave it weaker to counter Chinese influence in the Far East. Trump sensed it and tried to extricate the US from the war with Iran. But the region will never be the same again. Iran has suffered enormous military and civilian damage in a war that was not of its making. It has demonstrated its resilience and the potential to choke off the Strait of Hormuz. Trump wants an off-ramp for domestic reasons as well. His popularity is falling, and his MAGA baseis divided over the war with Iran. Prices at the petrol pump in the US reached $4.6 per gallon, thoughthey have come down since. If Republicans lose the slim majority in the Senate in the Congressional elections in November, Trump will become a lame-duck president. Pakistan's mediatory role in the war has raised its profile and won it $8-billion in Saudi assistance. It sent an air force contingent and ground troops to Saudi Arabia to be deployed on the country's eastern frontier. The intended target is obvious. This raises a paradox. Pakistan claims to bea neutral mediator to facilitate Iran's talks with the US, while allying itself with Tehran's regional adversary.It has also opened its borders tothe shipment of 3,000 containers through the Karachi port overland to Iran. This undermined the American blockade of Iranian ports, but the US took it in stride. Beyond such mediation and the gains that these may yield, history shows the way on building a more durable peace. The 1975 Helsinki Conference mitigated Cold War tensions as both sides recognised that European borders cannot be changed by force. A similar effort in West Asia, modelled on the Helsinki Conference, could address the deep sense of insecurity in the region. Two separate non-aggression pacts are needed - between the US and Iran, and between Iran and regional States, including Israel. This will bring Israel the recognition it seeks. A bilateral agreement between the US and Iran leaves Israel free to act. The war is not yet over. Even after the deal is signed on Friday, a long road to peace lies ahead. Israel is implacably opposed to the US-Iran deal, which will integrate Iran into the world economy. There are powerful constituencies both in the US and Iran that eye each other with suspicion. Meanwhile, the Indian crude oil basket has gone up from $72 per barrel before the war to $82.4 now. It had reached as high as $ 157 during the war. An increase of $1, if sustained, translates into an increase in India's annual oil import bill of more than Rs.15,000 crore. The urea prices tripled, LNG and LPG prices doubled. Though they have come down since, they are still 50-60% above the pre-war level. The prices will remain elevated even after the reopening of Hormuz as production facilities have been damaged, and insurance rates will remain high. It is time the war ends in the larger interest of the world....