Facts for Prelims (FFP)
Source: TH
Context: India and Iran have signed a 10-year contract for the operation of the Chabahar port, marking a significant milestone in their maritime cooperation.
The agreement enables the operation of the Shahid-Behesti terminal by Indian Ports Global Ltd. (IPGL) in collaboration with Iran’s Port and Maritime Organisation (PMO). With an investment of approximately $120 million from IPGL, India has also offered a credit window of $250 million for infrastructure improvement projects related to Chabahar. This agreement aims to enhance trade, marine cooperation, and transhipment, benefiting not only India and Iran but also Afghanistan.
About the Port
Chabahar Port, located in Iran’s Sistan and Baluchestan province, is strategically significant as the only deep-sea port in Iran with direct ocean access. It is part of the proposed International North-South Transport Corridor (INSTC), linking the Indian Ocean and the Persian Gulf to the Caspian Sea and northern Europe. For India, Chabahar Port offers a counterbalance to Pakistan’s Gwadar Port and China’s Belt and Road Initiative, providing access to Afghanistan and Central Asia. Challenges in the project’s execution include US sanctions on Iran impacting equipment suppliers and proposed Chinese involvement in Chabahar’s duty-free zone, potentially hindering India’s interests.
Chabahar’s strategic importance as a vital trade artery connecting India with Afghanistan and Central Asian countries is underscored, emphasizing its role in regional economic development and stability.
