Chabahar tidings: on Indian taking over port operations in Iran

Chabahar tidings: on Indian taking over port operations in Iran

News:

India takes over operations of the Shahid Beheshti port and opened the first office of Indian Ports Global Limited at Chabahar Port.

Important Facts:

About Chabahar Port:

• The port of Chabahar is located on the Makran coast of Sistan and Baluchistan Province, next to the Gulf of Oman and at the mouth of Strait of Hormuz.
• It is the only Iranian port with direct access to the Indian Ocean. Being close to Afghanistan and the Central Asian countries of Turkmenistan, Uzbekistan etc., it has been termed the “Golden Gate” to these land-locked countries.

Significance of Chabahar Port

• Pakistan does not allow India overland transit rights through its territory, Chabahar is crucial for India’s access to Afghanistan and beyond. India has a huge stake in Afghanistan and its stability and New Delhi is one of the biggest international donors in Afghanistan
• With the operationalization of the port, it will witness high activity such as it will circumvent the banking problems caused by western sanctions (U.S) on Iran and India will, for the first time, allow investment in rupees in Iran. This is a special arrangement which is only allowed for Nepal and Bhutan.
• The Chabahar port will cut transport costs/time for Indian goods by a third. The port is likely to ramp up trade among India, Afghanistan and Iran in the wake of Pakistan denying transit access to New Delhi for trade with the two countries.
• As a growing economy, India has been eyeing the energy-rich Central Asian countries. Natural gas from Central Asia could be exported to India via the Chabahar port. India is already a part of projects like the Turkmenistan, Afghanistan, Pakistan, and India (TAPI) pipeline.
• India is also a part of the International North-South Transport Corridor, which aims to move freight between India and countries like Iran, Armenia, Azerbaijan, the Central Asian countries and Russia hence, Chabahar port acquires critical role.
• The effort to build up Afghanistan’s economy is also aimed at reducing Kabul’s dependence on foreign aid and putting a major dent in the illicit opium trade that has been a major source of revenue for the Taliban insurgency.
• The port is seen as a counter to Pakistan’s Gwadar Port, which is being developed with Chinese investment and is located at a distance of around 80 km from Chabahar.

Challenges ahead:

• Security Concern in Afghanistan: The withdrawal of U.S. troops from Afghanistan, after the pullout from Syria, will add to security concerns for Afghanistan and impact on the Chabahar route as well.
• S Sanction: The Chabahar port has received a waiver from the U.S. sanctions on Iran for the moment, but these concessions could be withdrawn any time
• Deepen relationship with Pakistan: The reconciliation process with the Afghan Taliban is likely to see the regional powers, the U.S. and Russia engaging Pakistan more.
• Trade Diversion: In recent months, special cargo corridors have been opened with China, Kazakhstan, Turkey, Europe, Russia, the UAE, and Saudi Arabia, with more trade diverted through them than with traditional partners Pakistan and India.