Importance of Chabahar port for India

Source: The post Chabahar port important for India has been created, based on the article “Stay invested India should not tailor its ties with Iran to U.S. foreign policy changes” published in “The Hindu” on 18th May 2024.

UPSC Syllabus Topic: GS Paper 2-international relations- Bilateral, regional and global groupings and agreements involving India and/or affecting India’s interests

Context: India signed a 10-year agreement with Iran to develop and operate the Chabahar port. The project is crucial for India’s trade with Afghanistan and Central Asia. The U.S. warned of potential sanctions, but India aims to improve its trade routes and connectivity. Importance of Chabahar port for India

For detailed information on Chabahar Port Agreement read this article here

Why is the Chabahar port important for India?

Alternative Trade Route: Chabahar offers a route to Afghanistan and Central Asia, bypassing Pakistan.

Investment: India is investing $120 million and offering a $250 million credit facility.

International North-South Transport Corridor (INSTC): Chabahar is expected to connect to INSTC, reducing trade time and costs between India, Iran, Azerbaijan, and Russia.

Geopolitical Influence: Located 200 km from Pakistan’s Gwadar port, Chabahar helps India counter China’s Belt and Road Initiative in the region.

How has the U.S. policy affected the Chabahar port Project?

Sanctions Delay: U.S. sanctions on Iran delayed the project since its conception in 2003.

2015 MoU: India signed a memorandum of understanding in 2015 after the U.S. eased sanctions.

2016 Agreement: The project progressed during Prime Minister Modi’s visit to Iran.

2018 Sanctions: The U.S. withdrew from the nuclear deal in 2018, reimposing sanctions on Iran, raising questions about India’s cooperation.

Sanctions Waiver: India received a sanctions waiver due to U.S. interests in Afghanistan, which has now changed with the Taliban in power.

Way forward

India should stay invested in Chabahar. It should improve trade and connectivity projects with Central Asia, which is essential for India’s continued rise. India should not change its policy based on U.S. stance.

Question for practice:

Discuss the significance of the Chabahar port agreement between India and Iran, and the impact of U.S. policy on the project’s progress.