13 July 2016
The Chabahar agreement has been called historic, a milestone and, in the words of Iran’s President Hassan Rouhani, “a very big symbol of cooperation between the two great countries”. Plenty of grand rhetoric then, but what does it actually mean for maritime trade in the region?
Located in south-eastern Iran, Chabahar is the only Iranian port with direct access to the ocean. India now plans to invest $500m (£344m), opening up a trade route to Afghanistan and Central Asia, but crucially bypassing Pakistan.
Sumitha Narayanan Kutty, associate research fellow with the South Asia Programme at the S. Rajaratnam School of International Studies, believes that first and foremost it elevates the India-Iran relationship to a new level. “This is a cornerstone project,” she says, “and will expand India’s strategic partnership with Iran beyond a buyer-seller relationship.
“It adds actual substance to a relationship that has, thus far, been oversold through its ‘historic, cultural and civilizational’ tags.”
Bookending this new relationship is a contract for an initial ten years, although The Economic Times reports this can be extended. The next 18 months will focus on phase one of port construction. Early days indeed, but Chabahar has long been deemed to be a strategic game changer, despite difficulty in getting it off the ground: it was first floated in the early 2000s, but got mired in arguments of politics and finance, not to mention sanctions on Iran, which have been scaled back significantly in recent months.
IDSS / Online
Last updated on 21/07/2016