Home >politics >policy >Iran, India discuss investments, Chabahar port

New Delhi: India and Iran on Friday discussed a new blue print for closer cooperation that included speeding up the development of the strategic Chabahar port, enhancing connectivity, increased linkages in the energy sector as well as railways. This follows Iran and the international community arrived at a deal over its suspect nuclear programme last month.

The discussions took place in New Delhi during the day-long visit of Iranian foreign minister Javad Zarif, who is on his first visit here since the Iranian nuclear deal last month.

India conveyed its “commitment to work with Iran for development of the Chabahar port that would have far reaching benefit, not only for the people of India and Iran, but also for Afghanistan and the entire Central Asia region. Both exchanged views on the regional developments, including in Afghanistan, West Asia and South Asia," a government statement said after talks between Zarif and Prime Minister Narendra Modi in New Delhi.

The Iranian foreign minister’s visit comes at a time when India is looking to recalibrate its ties with the countries in West Asia—between security partner Israel, Shia-majority Iran, which is a crucial energy partner, and the Sunni Arab Gulf nations that have an impact on Indian security and also are home to many million Indian expatriate workers and important suppliers of energy.

Prime Minister Modi met Iranian President Hassan Rouhani in the eastern Russian city of Ufa last month where the two leaders discussed the prospects of connectivity between Iran,India and Central Asia.

India has announced a visit by Modi to Israel in the near future, which will be the first visit by an Indian prime minister to the Jewish country.

Modi is also set to travel to the United Arab Emirates on 16-17 August and is expected to visit Saudi Arabia, the regional rival of Iran.

The transport ministry official said the discussions between transport minister Nitin Gadkari and Zarif also touched on the Chabahar port. “The discussions were very positive," said the official who did not want to be named. The meeting with Gadkari lasted about half an hour.

On his part, Zarif said “both, India and Iran, are eager to engage" on Chabahar.

“I believe sooner rather than later we will start serious work," Zarif told reporters, according to a Reuters report.

India and Iran agreed in 2003 to develop a port at Chabahar on the Gulf of Oman, near Iran’s border with Pakistan, but the venture has made little progress because of Western sanctions on Iran.

But in May, India and Iran signed the pact for developing the port. “With the signing of this MoU (memorandum of understanding), Indian and Iranian commercial entities would now be in a position to commence negotiations towards finalization of a commercial contract under which Indian firms will lease two existing berths at the port and operationalize them as container and multi-purpose cargo terminals," a ministry of external affairs statement had then said.

India, which has already spent about $100 million to construct a 220km road in western Afghanistan to link up with Chabahar port, wants to build the port as it would cut transport costs and freight time to Central Asia and the Gulf by about a third.

The port, located in Sistan-Balochistan Province on Iran’s southeastern coast, is of great strategic utility for India which will get sea-land access route to Afghanistan bypassing Pakistan.

The port will be used to ship crude oil and urea, saving India transportation costs. India intends to lease two berths at Chabahar for 10 years. It will be developed through a special purpose vehicle (SPV) which will invest $85.21 million to convert the berths into a container terminal and a multi-purpose cargo terminal.

After Zarif’s meeting with Indian external affairs minister Sushma Swaraj, Vikas Swarup, the external affairs ministry spokesman, said that the two countries had discussed relations in the context of energy, infrastructure and trade.

“On energy, the aim is to move from the existing buyer-seller relationship to a genuine energy partnership involving both upstream and downstream. We want Iran to regain its share of India’s oil imports and we expect Iran to also make efforts to help promote the participation of Indian companies," Swarup said in a statement. “In this context, there was a discussion on Farzad B. An Indian company (OVL) had successfully discovered the field and it is our expectation that it will get the opportunity to develop it."

Zarif later told reporters Iran would look at Indian efforts to develop the Farzad oil field favourably as India had stood by Iran through the period when it was under sanctions and opposed the punitive strictures.

Swarup said Swaraj and Zarif had discussed connectivity between the two countries. “Connectivity is also an important part of the economic relationship. We are at an advanced stage in two ongoing projects related to Chahbahar and the International North South Transport Corridor (INSTC)." The latter is a project to link India and Iran via sea route and then through Iran to the Caspian sea onwards to Central Asia.

“On INSTC, both sides acknowledged the need to speed up the process. In fact the ministerial council meeting of INSTC is taking place in New Delhi on August 21," Swarup said.

“There was a discussion on India participating in the Iranian railways sector, where we are both price and technology competitive," he added.

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