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Topic : India-Iran Contract on Chabahar Port
GS-2 Mains : IR
Revision Notes
Agreement:
- 10-year contract signed for operation of Chabahar Port’s Shahid-Beheshti terminal.
- Replaces previous one-year contracts.
- $250 million credit window offered by India for Chabahar-related infrastructure projects.
About Chabahar Port:
- Iran’s only oceanic port, strategically located on the Gulf of Oman.
- Shahid Beheshti Port under development in phases (target capacity: 82 million tons/year).
- Offers access to energy-rich Persian Gulf nations and bypasses Pakistan.
- Closer to India than Kandla port (Gujarat).
Significance for India:
- Geopolitical Advantage: Provides direct sea access to Afghanistan and Central Asia, bypassing Pakistan.
- Alternative route to the Strait of Hormuz for Central Asian cargo traffic.
- Gateway to INSTC: Boosts access to International North-South Transport Corridor (INSTC) connecting India, Russia, Iran, Europe, and Central Asia.
- Countering China: Offers an alternative to China-developed Gwadar Port in Pakistan.
- Trade Benefits: Facilitates import of iron ore, sugar, rice, and potentially reduces oil import costs.
India-Iran Relations
Strong Political Ties:
- Friendship treaty since 1950.
- Regular consultations at various levels.
- Joint Working Groups on key sectors.
Growing Economic Cooperation:
- Bilateral trade at $2.33 billion (FY 2022-23, 21.76% growth).
- Efforts to diversify payment channels.
Challenges:
- International sanctions on Iran (esp. nuclear program) affect trade, especially energy imports.
- Complex geopolitical landscape in Middle East and South Asia.
- Security concerns in the region, including Afghanistan.
- Slower-than-expected progress on Chabahar Port development.
- External powers’ influence can complicate cooperation.
- Uncertainties surrounding Iran nuclear deal.
Way Forward:
- Balancing act for India amidst evolving geopolitics.
- Continued exploration of collaboration and economic partnership.
- India’s major investments in Chabahar Port for strategic advantage.
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