NEW DELHI: India signed an agreement with Iran on Wednesday that would allow it to develop a port in southeast Iran. The deal comes as Prime Minister Narendra Modi attempts to improve India’s access to landlocked Afghanistan and other central Asian countries at a time when China is expanding its role in the region.
India is hoping to capitalize on a thaw in relations between Iran and Western powers, including the U.S., which are hashing out the details of an agreement meant to block Tehran from developing nuclear weapons in exchange for the lifting of Western sanctions.
The U.S., however, has warned against moving on projects with Iran before a formal nuclear agreement is reached by the June 30 deadline.
India’s deal with the Iranian government comes a few weeks after China unveiled a $46 billion infrastructure spending plan in Pakistan, which neighbors Iran, aimed at opening new trade and transport routes across Asia.
The planned Iranian port lies a short distance from the Chinese-run Gwadar port in Pakistan, which is expected to be the cornerstone of China’s development plans in that country.
Wednesday’s agreement between India and Iran would pave the way for firms from the two countries to negotiate a commercial contract under which India would develop two berths at the Chabahar port as container and cargo terminals, India’s Foreign Ministry said. The proposal has been pending since 2003.
India’s cabinet in October had signed off on the formation of a joint venture company to invest more than $85 million in the development of the port, which will help India reach Afghanistan without having to rely on Pakistan.
The port would significantly enhance Afghanistan’s connectivity to regional and global markets, according to India’s Foreign Ministry, and provide a “fillip to the ongoing reconstruction and humanitarian efforts in the country.”
