Global Affairs Desk

Tue Jun 18 2024

Development of Chabahar Port - India's Objectives and Challenges

~ By Aarush Joshi on 6/14/2023

Development of Chabahar Port - India's Objectives and Challenges

In the month of November, 2022, India and Iran held Foreign Office Consultations during the visit of Tehran’s Deputy Foreign Minister for Political Affairs Ali Bagheri Kani to India. Dr. Kani is a close relative Iran’s Supreme Leader Ayatollah Ali Khamenei, handles Iran’s nuclear negotiations and is considered to be part of the ruling elite of the Iranian state. This is the first high profile visit from the Iran since the crackdown against democratic protesters began in Iran in the second fortnight of September. India did not comment about the crackdown.

“During the delegation level talks, the two sides reiterated their commitment to continue cooperation for development of the Shahid Beheshti terminal of the Chabahar Port,” said the Ministry of External Affairs in a press note released after the talks between the two delegations. Further, when asked whether India would restart purchases of Iranian oil, Ministry of External Affairs Spokesperson said that there were no updates.

Iran had earlier said that it was ready to sign a long term contract with India on developing the Chabahar Port in order to realise its true potential in the coming years. Iranian minister of Roads and Urban Development Rostam Qasemi expressed Tehran’s intention during his meeting with visiting India's Minister of Ports, Shipping and Waterways, Sarbananda Sonowal in Tehran earlier this week.

Qasemi described India as an important and big country that can play an essential role in the transit of goods in the region. He also hoped that the relations between the two countries regarding investment in Chabahar port will materialise.

The Chabahar Port is located in South Eastern Iran in the Gulf of Oman and the only Iranian Port to have direct access to the ocean. It is considered a gateway to golden opportunities for trade by India, Iran and Afghanistan with Central Asian Countries.

Significance of Chabahar Port for India

  • Direct route to Afghanistan: The development of this port will ensure the establishment of a politically sustainable connectivity between India and Afghanistan. This will lead to better economic ties between the two countries. This will also help India circumvent Pakistan and its influence since Pakistan denies the use of its territory by Indian trucks bound to Afghanistan. The result will be less Afghan dependence on Pakistan and, hence, less Pakistani influence over Afghan domestic politics, which will benefit India strategically.

  • Countering China: Chabahar Port will also be beneficial to India in countering the China-Pakistan Economic Corridor as well as Chinese presence in the Arabian Sea which China is trying to ensure by helping Pakistan to develop the Gwadar Port.

  • Trade and Commerce: Chabahar Port becoming functional will also significantly boost the import of iron ore, sugar and rice to India. • According to the Ministry of Commerce, Chabahar port, along with INSTC, offers 30% cheaper imports than the Mediterranean-Suez Route. Natural gas from Central Asia can be exported to India via the Chabahar port. India is already a part of projects like Turkmenistan, Afghanistan, Pakistan, India (TAPI) pipeline. Also, India has already increased its crude purchase from Iran since the West imposed ban on Iran was lifted.

  • Link to International North-South Transport Corridor: Chabahar port will boost India's access to Iran, the key gateway to the International North-South Transport Corridor that has sea, rail and road routes between India, Russia, Iran, Europe and Central Asia.

Major Roadblocks

  • Growing Iran-China ties: In the recent times, Iran has moved closer to China, with the latter brokering a crucial deal in the Middle East. China is also developing relations with Iran, as evidenced by the Chinese President's 2016 visit to Iran, dubbed the ‘Comprehensive Plan for Cooperation between Iran and China’.

  • Iranian approval of the draft strategic partnership with China, whereby both countries propose to take their long-term partnership to a new level through the USD 400 billion agreement.

  • China brokering the peace deal in the Middle East is a major step and establishes China as a big player in the region.

For smooth development of the Chabahar Port and economic prosperity for both countries, strong bilateral political and economic ties between India and Iran will be critical and a defining moment in the relationship. Chabahar is turning out to be a success story in the India ran relationship. With the operationalisation of the port, it is witnessing high activity, and there are unconfirmed reports of traffic being diverted from Karachi to Chabahar. India is one of a handful of countries that continued trade links with Iran despite it being isolated by Western countries against its disputed nuclear programme.

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