India Secures 10-Year Chabahar Port Deal With Iran, Bypassing Rival Pakistan's Gwadar

By John Lopez

May 13 2024, 13:31 PM EDT

India has inked a significant 10-year agreement with Iran, solidifying its foothold in the strategically vital Chabahar Port.

The deal, signed on Monday, strengthens bilateral ties between India and Iran while bypassing Pakistan's Gwadar Port, a move laden with geopolitical implications.

The agreement comes as India's Narendra Modi-led government seeks to strengthen regional connectivity and trade routes, particularly amid escalating regional tensions.

India Secures 10-Year Chabahar Port Deal

According to Reuters, the agreement involves India's Indian Ports Global Limited (IPGL) investing approximately $120 million and financing an additional $250 million for a total contract value of $370 million.

This long-term commitment demonstrates India's intention to improve its logistical capabilities and strengthen trade routes with Afghanistan and Central Asian countries.

The Chabahar Port, located on Iran's south-eastern coast along the Gulf of Oman, is highly strategic for India. Speaking to the press, India's Shipping Minister Sarbananda Sonowal emphasizes that the port is an important trade route connecting India to Afghanistan and Central Asian countries.

He says the port's significance extends beyond commerce; it promises to strengthen supply chain resilience across the region, benefiting India's strategic interests.

IRAN-ECONOMY-CHABAHAR — A picture taken during an inauguration ceremony of new equipment and infrastructure at Shahid Beheshti Port in the southeastern Iranian coastal city of Chabahar, shows a ship passing through the port on the Gulf of Oman, on February 25, 2019. ATTA KENARE/AFP via Getty Images

India Bolsters Regional Connectivity with Landmark Chabahar Port Agreement

Times of India notes that India's management of the Chabahar Port marks a significant milestone, representing the first instance of India assuming operations at an overseas port.

This move is part of India's larger efforts to counterbalance Pakistan's Gwadar Port and China's Belt and Road Initiative, thereby increasing its regional influence.

India intends to bypass Pakistan by connecting Chabahar to the International North-South Transport Corridor (INSTC) in order to gain more efficient access to Afghanistan and Central Asia.

India's 10-year Chabahar Port agreement with Iran marks a new chapter in regional connectivity and trade dynamics. It strengthens bilateral relations and solidifies India's position as a key player in South and Central Asia's evolving geopolitical landscapes.