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India signs Chabahar port deal to expand trade with Central Asia

14 May 2024 Evaluate

With an aim to enhance regional connectivity and facilitate trade, particularly between India, Iran and Afghanistan, India has signed a 10-year contract to operate the strategic Iranian port of Chabahar. This will help to expand trade with Central Asia. The Chabahar port on the Gulf of Oman – which New Delhi had proposed to develop way back in 2003 - will provide Indian goods a gateway to reach landlocked Afghanistan and Central Asia using a road and rail project called International North-South Transport Corridor, bypassing Pakistan.

US sanctions on Iran over its suspected nuclear programme had slowed the development of the port. The long-term agreement was signed by Indian Ports Global Limited (IPGL) and the Port & Maritime Organisation of Iran. IPGL will invest about $120 million while another $250 million will be raised as debt.

This is the first time India will take over the management of an overseas port that will also have a multiplier effect on trade among India, Iran and Afghanistan as efforts continue to directly tap the potential in Central Asia, bypassing neighbouring Pakistan.


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