India proposes inclusion of Chabahar port in “INSTC | International North-South Corridor”

What is the news?

India’s Foreign Minister addresses the Chabahar Day event organized at the Maritime India Summit 2021. During the address, the minister put forward the following proposal with respect to INSTC (International North-South Transport Corridor):

• Inclusion of Chabahar Port in the International North-South Transport Corridor(INSTC).
• Expansion of the INSTC membership by including Afghanistan and Uzbekistan.

About the International North-South Transport Corridor(INSTC):

1. INSTC was first proposed in 2000 to improve connectivity between Russia, Central Asian states, and India.
2. Route: It is a 7,200-km-long multi-modal connectivity project to establish transport networks (ship, rail, and road route). It will be used for moving freight between India, Russia, Iran, Europe, and Central Asia. It will cut costs and time in moving cargo.
3. Members: It includes 13 countries namely India, Iran, Russia, Turkey, Armenia, Azerbaijan, Belarus, Kazakhstan, the Kyrgyz Republic, Tajikistan, Oman, Syria, and Ukraine.
4. Dry Runs: Dry runs of two routes were conducted in 2014 to identify and address key bottlenecks. The two routes were:
   • The first was Mumbai to Baku via Bandar Abbas and
   • The second was Mumbai to Astrakhan via Bandar Abbas, Tehran, and Bandar Anzali.
5. However, the project has been slow to take off. Despite a renewed focus on INSTC by India and Russia, work was again hit by the Covid-19 pandemic.

Significance of INSTC:

• Increase in Bilateral Trade: It has been predicted that improved transport connectivity will increase bilateral trade volumes between Russia, Central Asia, Iran, and India.
• Shorter and Cheaper Route: As per the study by the Federation of Freight Forwarders’ Associations in India, INSTC route is 30% cheaper and 40% shorter than the current traditional route.
• Can Counter China’s Belt and Road Initiative: INSTC has economic and strategic relevance to India due to China’s ambitious One Belt, One Road Initiative. Hence, the proposed INSTC trade corridor could help India secure its interests in Central Asia and beyond.
• Integration with Ashgabat Agreement: The INSTC can integrate with the Ashgabat agreement.

Ashgabat Agreement:

• Ashgabat agreement is a multimodal transport agreement between the governments of Kazakhstan, Uzbekistan, Turkmenistan, Iran, India, Pakistan, and Oman.
• Aim: It aims to create an international transport and transit corridor facilitating transportation of goods between Central Asia and the Persian Gulf.

Source: The Hindu