India, Afghanistan and Iran have finalized the text of the Trilateral Agreement on Transport and Transit Corridors, known as the Chabahar Agreement, at the recently held meeting in New Delhi.
The agreement is to pave way for India to access Afghanistan via the Iranian port of Chabahar, bypassing Pakistan, which has limited trade relationship with New Delhi amid diplomatic tensions.
“When the agreement comes into force it will significantly enhance utilization of Chabahar Port, contribute to economic growth of Afghanistan, and facilitate better regional connectivity, including between India and connections to Afghanistan and Central Asia. The agreement will be a strategic bulwark for greater flow of people and goods among the three countries as well as in the region,” India’s Ministry of External Affairs said.
The finalization of the terms of the agreement come on the back of the lifting of sanctions against Iran which were a major impediment for the trio to move forward with the project dating back to 2013.
In 2015 Government of India assigned USD 100 million for upgrading the port of Chabahar in Iran, the final objective being trade boost with Afghanistan and other Central Asian countries. This was followed by an approval of a USD 150 million credit facility in February to support the development the port.
The investment underlies development of a multiple-use cargo jetty and two container terminals that would decrease transport costs of Indian goods by around 30 % when compared to the country’s other waterways.
The Port of Chabahar is the only Iranian port with direct access to the ocean. It is located in southeastern Iran and has access to both the Oman sea and the Persian (Arabian) Gulf. India helped build the port in the 1990s, as it provides access to Afghanistan and Central Asia, bypassing Pakistan.
The agreement is expected to be signed later this year during a visit by Indian Prime Minister Narendra Modi to Iran.
Source: World Maritime News
Source: World Maritime News