During a recent visit to Iran, the Indian Prime Minister Narendra Modi signed an agreement that commits the country to providing US$500 million of financing for the development of the port of Chabahar. The port of Chabahar is located in southeastern Iran in the Gulf of Oman and is the only Iranian port with direct access to the ocean.
India Ports Global Private Limited (IPGPL), in which both JNPT and Kandla Port have a stake, and Arya Banader of Iran will jointly undertake a ten year development plan, which includes the development of five cargo handling berths, two of which will be used for container traffic and three for multi-purpose operations. India also plans to invest heavily in the Chabahar free trade zone and to build rail connections to the port.
India sees Chabahar as being the key to the expansion of its trade routes not just to Iran, but also Afghanistan and Russia, bypassing Pakistan. The investment is also widely seen being an attempt to counter Chinese influence in the region, as China is the main investor in Pakistan’s Gwadar port, 72km to the east of Chabahar.