U.S. sounds caution as India inks port deal with Iran

India and Iran recently signed an inter-Governmental Memorandum of Understanding (MoU) regarding India’s participation in the development of the Chabahar Port in Iran.

  • With the signing of this MoU, Indian and Iranian commercial entities will now be in a position to commence negotiations towards finalisation of a commercial contract under which Indian firms will lease two existing berths at the port and operationalise them as container and multi-purpose cargo terminals.

Concerns raised by the US:

However, the US has cautioned India against rushing in with investments as the nuclear deal being negotiated was not final and said there was need to maintain the international solidarity that has brought this hard fought diplomatic victory.

Why is India interested in Chabahar Port?

  • Chabahar is located close to the strategic Persian Gulf. It will impart significant strategic leverage to India giving it access to Afghanistan and to the energy-rich Central Asia bypassing Pakistan. It also cuts down transit time by a third accruing significant time and cost savings.

Further plans:

India, which has invested over $2 billion in Afghanistan, plans to link the Chabahar port with the Zaranj-Delaram road, the garland highway, India built in Afghanistan by upgrading the Chabahar-Milak road opening alternative access to sea port for Afghanistan’s connectivity to regional and global markets. India has already committed $100 million to develop the port.

The Chabahar deal has been long pending due to U.S. pressure on India in light of the severe sanctions imposed on Iran.

Sources: The Hindu, Wiki.