India will float a company to develop Iran’s Chabahar Port, as New Delhi aims to take advantage of a thaw in Tehran’s relations with world powers.
The port of Chabahar in southeast Iran is central to India’s efforts to circumvent Pakistan and open up a route to landlocked Afghanistan where it has developed close security ties and economic interests.
The planned Indian company will invest $85.21 million in one year to convert the berths into a container terminal and a multi-purpose cargo terminal, the statement said, adding India would consider the participation of Iranian firms if needed.
The decision to ink MoU with Iran for expansion of Chabahar Port will finally open up major commercial and strategic opportunities for India. In the absence of transit through Pakistan, Iran is India’s gateway to Afghanistan, Central Asia, and Russia and beyond and the Chabahar port is the key element in that. The location of the port also has a strategic significance; it is located barely 72 km away from the deep-sea Gwadar port of Pakistan.
Once functional, Chabahar will further undermine Gwadar. While Pakistan and China both had high hopes from Gwadar (built with Beijing’s assistance), the insurgency in Balochistan is proving to be Achilles hill for both the countries.
While the Chabahar port is essentially meant for commercial purposes and provides transit route to Afghanistan, India can use the facility to monitor Pakistani and Chinese activities in the Indian Ocean Region as well as Gulf. It could also be convenient location for India to monitor activities of Pakistani Navy.
India-built Zaranj-Delaram road in Afghanistan will connect to the Chabahar port via Milak. Iran with financial aid from India is upgrading the Chabahar-Milak road.