Chabahar Port: What New Delhi Gains from the Deal with Iran 

India has recently signed a 10-year agreement for the operation of the Shahid-Behesti terminal at the Chabahar Port in Iran. This is a deal between Indian Ports Global Ltd (IPGL) and the Port and Maritime Organization (PMO) of Iran. At the same time, New Delhi has committed to invest $120 million USD to acquire equipment for port operations. It has also offered a credit window of $250 million for developing infrastructure around the port.

Chabahar is important because of its location, roughly 72 kilometers west of Pakistan's Gwadar Port. India has already spent approximately $100 million constructing a 218 km long road from Delaram in western Afghanistan to Zaranj in the Iran-Afghan border. This road also links up with Chabahar Port. 

Indo-Iranian cooperation on the port goes back to the 1990s. It was partially built at the time to provide access to Afghanistan and Central Asia, bypassing Pakistan. The port is also critical for India's efforts to circumvent Pakistan and open up a route to landlocked Afghanistan. Though New Delhi's relations with Afghanistan have gone downhill since the Taliban takeover in August 2021, things could change once again in the future.     

Challenges

Nevertheless, there are quite a few challenges before the project sees success.

One is the situation in the immediate neighborhood, where Iran is involved in a series of conflicts. Apart from the war between Israel and Hamas in which Iran is involved, Iran and Pakistan have also fired missiles at each other in the recent past. Furthermore, both sides have accused each other of harboring terrorists. 

Iran has also supported Russia in its war against Ukraine. Supplying drones to Russia has brought Tehran into the crosshairs of the Western world, especially countries like the United States. 

Meanwhile, the US has also threatened that it would also be looking into the deal. It is worth mentioning here that the United States has taken a strong position in the past when it comes to the Iranians. The US Department of State Principal Deputy Spokesperson Vedant Patel noted this at a press briefing: "So, we're aware of these reports that Iran and India have signed a deal concerning the Chabahar port… I will just say, as it relates to the United States, US sanctions on Iran remain in place and we'll continue to enforce them." 

For example, India had been importing oil from Iran earlier. Now, however, it has shifted to other sources like Russia to meet its domestic needs. That comes in the wake of US sanctions on entities dealing with Iran. 

In addition, things have changed now after the death of Iranian President Ebrahim Raisi. He, alongside Foreign Minister Hossein Amir-Abdollahian, died in a recent helicopter crash. The situation in Iran remains fluid as there are domestic dissonances in the country for a host of reasons. These could also impact the smooth functioning of the Chabahar Port.

What Does India Stand to Gain?

Through the Chabahar Port, not only does India stand to gain by way of access to Central Asia and Afghanistan, it helps India emerge as a major player in the region as far as connectivity is concerned. Specifically, it also provides countries like Iran an alternative to the China-led Belt and Road Initiative (BRI).

In addition, India is a part of projects like the International North-South Transportation Corridor Project. This will allow it to reach countries like Russia as well as Central Asian countries. In this respect, the role of the Chabahar Port will be crucial.

Also interesting is that the Taliban government in Kabul has actually welcomed the development. It noted that the Taliban government could provide alternate access to Afghanistan bypassing Pakistan. Notably, after much reticence, India has opened channels of communication with the Taliban regime in Afghanistan.

How Does It Stand Against the BRI?

China has made rapid inroads into the region. The China-Pakistan Economic Corridor (CPEC) passes through Pakistan and Pakistan-Occupied Kashmir PoK). New Delhi has tried its best to claw back into the connectivity game in the region. 

On the east, India already has an initiative known as the India-Myanmar-Thailand trilateral highway. In addition, India is now part of many connectivity initiatives in the region like the IMEC (India-Middle East-Europe Economic Corridor) initiative as it seeks to build new ground.

Connectivity is very important for India, the fastest-growing major economy in the world. It is also notable that India is an energy-deficient region and hence it needs to bring in energy resources from around the world. On that point, the Central Asian region is a major producer of hydrocarbons.

What's In It For Japan?

For Japan, this is a tricky situation. Japan has not participated in the China-led Belt and Road Initiative.  However, at the same time, Japan is a close ally and confidant of the United States. Hence it would be difficult for Japan to participate in the Chabahar project, given the US position on Iran. Meanwhile, Japan and India have worked together on projects in countries like Sri Lanka. Hence it is important to continue cooperating in those countries as well.

Nevertheless, it would be in Japan's interest to have an alternative to the China-led BRI in place. Therefore, taking the long view, the Chabahar port in Iran could work to Japan's advantage.

RELATED:

• China's Trans-Himalayan Railway: Is Nepal on Its Way to a Monster Debt Trap?
• EDITORIAL | With Attack on Israel, Iran Pushes for Wider Mideast War
• To Counter China’s Belt and Road Initiative, Japan, India Can Look to Iran’s Chabahar Port
  
  

Author: Dr Rupakjyoti Borah
Dr Rupakjyoti Borah is a Senior Research Fellow with the Japan Forum for Strategic Studies, Tokyo. The views expressed here are purely personal.