New Delhi: India signed a long-term lease of 10 years for equipping and operating the strategic Iranian port of Chabahar. Nestled strategically, this move keeps open direct pathways connecting Indian ports to Afghanistan and Central Asia.
The signing ceremony was held in Tehran on Monday, May 13, with the contract inked between India Ports Global Ltd (IPGL) and Ports & Maritime Organisation of Iran (PMO). It was witnessed by India’s shipping minister Sarbananda Sonowal and Iranian minister for roads and urban development, Mehrdad Bazrpash. At the end of the 10-year period, both sides would further extend their cooperation in Chabahar.
🇮🇳🇮🇷| Scripting a new chapter in bilateral partnership!
AdvertisementMinister @shipmin_india & @moayush @sarbanandsonwal witnessed the signing of the long-term contract for the operation of the Shahid Beheshti Port in Chabahar, between India Ports Global Ltd. & Ports and Maritime… pic.twitter.com/hUddkyQrkE
— Randhir Jaiswal (@MEAIndia) May 13, 2024
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The state-run IPGL will invest around $120 million in equipping the port. India has also offered a credit window in Indian rupees amounting to $250 million for “mutually identified projects aimed at improving Chabahar-related infrastructure”.
At the end of the signing ceremony, Iranian minister Mehrdad Bazarpash said at a press conference that in addition to developing the port, there is also a proposal for both countries to launch a joint shipping line.
This is significant as Iran and India had a joint venture known as Iran-o-Hind shipping company, which was co-owned by the Islamic Republic of Iran Shipping Lines (IRISL) and the Shipping Corporation of India. The joint venture went defunct when it became the target of sanctions by the US and other Western countries.
The deep-water port of Chabahar is located in Iran’s Sistan-Baluchistan province. The planned inland rail corridor from Chabahar goes upto the provincial capital of Zahedan, which is linked via road to Afghanistan side. From Zahedan, there is another rail line till Sarakhs, which is near the Iran-Turkmenistan border.
The Iranian minister claimed that the Chabahar-Zahedan railway section would be completed by the end of 2024.
In May 2016, India, Iran and Afghanistan had signed a trilateral agreement for the development of Chabahar. India’s IPGL had taken over the full operation of the Chabahar port in December 2018, but work had been slow due to geopolitical realities.
While the Chabahar port was not sanctioned under the Trump administration, private companies were reluctant to deliver equipment for the Iranian port due to the fear of attracting adverse attention from Washington.
So far, India has supplied 6 Mobile Habour Cranes and other equipment worth $25 Million.
Indian officials claim that since 2018, the port has handled traffic of more than 90,000 TEUs of Container traffic and more than 8.4 MMT of Bulk and General Cargo.
