The Indian government has signalled that it hopes to commence work developing facilities in Chabahar in Iran in the near future. Union Minister of Road Transport and Highways, Nitin Gadkari, has said that the first phase of the work will be completed in 2018, and that funds are likely to be released shortly.
Located in Sistan-Balochistan province on Iran’s southern coast, the port of Chabahar can be easily accessed from India’s west coast and avoids the need to transit through Pakistan. To stimulate trade and investment between the two countries, the Indian Cabinet last year approved proposals, for investments in the port, including making use of a US$ 150 million credit from the EXIM Bank. It also authorised the Shipping Ministry to create a company based in Iran to implement the Chabahar port development project.
Phase 1 of the Port, which India hopes will be operational by the end of next year, will comprise two berths, which will be operated by the newly created company on a ten year lease. Capital investment of more than US$ 85 million is promised under the terms of an MOU between India and Iran signed last year by the Modi government.