India all set to ink deal to develop Chabahar port in Iran

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News Iran India

India is poised to counter the recently announced $46-billion expansion of China’s strategic footprint in Pakistan with a foothold on the Iranian coast. New Delhi is set to ink a memorandum of understanding (MoU) on the development and operation of Chabahar port in Iran, taking into account the international obligations that arise out of Tehran’s nuclear programme.

Merely 72 km west of China-developed Gwadar port in Pakistan’s restive province of Baluchistan, Chabahar, on the mouth of the Straits of Hormuz in the Persian Gulf, provides India a land-sea access route into Afghanistan and Central Asia through the Bandar Abbas-Caspian Sea axis.

The MoU is expected to be signed in Tehran by roads, transport and shipping minister Nitin Gadkari very soon.

Although India’s development of Chabahar port has been hanging fire since 2003, Chinese President Xi Jinping’s two-day visit to Pakistan this week has triggered renewed interest in the Modi government with Bejing announcing a network of roads, railway, optical fibre cables and pipelines linking the strife-ridden Xinjiang province to Gwadar via the Karakoram highway.

Intelligence reports indicate China will push the optical fibre line to Afghanistan via Pakistan so that Islamabad continues to have a big say in Kabul. The 1,300-km Karakoram highway links Kashgar in Xinjiang to Hassan Abdal in Punjab of Pakistan.

Although the inter-governmental MoU between India and Iran involves a joint venture investment of $85.21 million (about R537 crore) that will allow operation of the port for 10 years, New Delhi is examining the option of signing the agreement and injecting the money later so it does not violate any international obligations. The joint venture — between Jawahar Lal Nehru Port Trust, Kandla Port Trust and an Indian or Iranian company — will be supported by annual expenditure of around Rs150 crore.

According to plans, the Indian JV will develop two berths at Chabahar, one to handle container traffic and the other a multi-purpose cargo terminal. With sea-land access to Afghanistan as part of the MoU, New Delhi has plans to build a road-railroad network from Chabahar to Milak in Iran in order to link it with the Indian-built 223-km Zaranj-Delaram road in Afghanistan so that aid could be pushed to Kabul and beyond.

Chabahar port will also allow Indian goods into Central Asia using the existing north-south corridor to counter Beijing’s domination in the region as reports indicate Indian traders are using Chinese ports to push goods into Kazakhstan. “The Chabahar MoU is crucial to India as Pakistan will never allow a land route to Afghanistan and PM Narendra Modi’s proposed July 2015 visit to Central Asia will have little to offer to these extended neighbours,” said a South Block official.

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