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Source-This post on Chabahar port operation pact is based on the article “India, Iran sign Chabahar port operation pact” published in “The Hindu” on 13th May 2024.
Why in the News?
India and Iran recently signed a 10-year contract to operate the Chabahar port.
About India-Iran Chabahar Port Agreement
1. India and Iran have signed a 10-year contract for the operation of the Chabahar port. This agreement comes eight years after the initial establishment of the general cooperation framework.
2. Signing Parties: The contract was signed between Indian Ports Global Ltd. (IPGL) and Iran’s Port and Maritime Organisation (PMO).
3. Investment and Credit Line: IPGL plans to invest approximately $120 million in equipping the port and its infrastructure. Additionally, India has offered a credit window worth $250 million for Chabahar-related infrastructure projects.
4. Historical Context: A memorandum of understanding for Chabahar port development was signed in May 2015, with the contract executed in May 2016 during Prime Minister Narendra Modi’s visit to Iran.
5. Significance: The agreement has been termed as a historic milestone for the maritime sector.
i) It is expected to foster trade, marine cooperation, and transshipment, while boosting trilateral trade between India, Iran, and Afghanistan.
ii) Regional Connectivity: Chabahar port serves as a vital trade artery connecting India with Afghanistan and Central Asian countries. Its development is seen as crucial for enhancing regional connectivity and promoting economic development in the region.
iii) Strategic Importance: It is located in Iran’s Sistan-Baluchistan province. Chabahar is a deep-water port with significant strategic value. It offers India an alternative route to access Afghanistan and Central Asia, bypassing Pakistan.
iv) The agreement signifies India’s commitment to further invest in Chabahar port, enhancing its efficiency and capacity. India aims to utilize the port for humanitarian aid shipments, demonstrating its commitment to regional development beyond commercial interests.
Read more: Chabahar port
UPSC Syllabus: International relations
