India and Iran have signed a bilateral agreement today to develop the Chabahar port and related infrastructure, with Indian earmarking about USD 500 million for this purpose.
The deal has been signed after India, Afghanistan and Iran finalized the text of the Trilateral Agreement on Transport and Transit Corridors , in New Delhi last month.
The agreement is to pave way for India to access Afghanistan via the Iranian port of Chabahar, bypassing Pakistan, which has limited trade relationship with New Delhi amid diplomatic tensions.
The finalization of the terms of the agreement came on the back of the lifting of sanctions against Iran which were a major impediment for the trio to move forward with the project dating back to 2013.
The investment underlies development of a multiple-use cargo jetty and two container terminals that would decrease transport costs of Indian goods by around 30 % when compared to the country’s other waterways.
“The outcomes and agreements signed today open a new chapter in our strategic partnership. The welfare of our people is guiding our broad based economic ties. Expanded trade ties, deeper connectivity, including Railways partnerships in oil and gas sector fertilizers education and cultural sphere are driving our overall economic engagement. The bilateral agreement to develop the Chabahar port and related infrastructure, and availability of about US$ 500 million from India for this purpose, is an important milestone. This major effort would boost economic growth in the region,” Indian Prime Minister Narendra Modi, who is in official visit to Tehran, said.
According to Modi, India is committed to take steps for early implementation of the agreements signed today.
“Later today we are going to sign the trilateral Transport and Transit Agreement with participation of Iran, India and Afghanistan. It will be a historic occasion. It will open new routes for India, Iran and Afghanistan to connect among themselves. India and Iran also share a crucial stake in peace, stability and prosperity of the region, ” he added.
The three countries also agreed to enhance interaction between their respective defence and security institutions on regional and maritime security.
The Port of Chabahar is the only Iranian port with direct access to the ocean. It is located in southeastern Iran and has access to both the Oman sea and the Persian (Arabian) Gulf.
World Maritime News Staff