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Topic : India-Iran Contract on Chabahar Port

GS-2 Mains : IR

Revision Notes


  • 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.


  • 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.

Source : https://www.thehindu.com/news/national/india-iran-sign-long-term-bilateral-contract-on-chabahar-port-operation/article68171624.ece

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