Direct Container Shipping Routes Launched From Chabahar to India

EghtesadOnline: Two direct container shipping lines have been launched from Iran’s Chabahar Port to India’s Jawaharlal Nehru Port and Kandla Port.

News ID: ۷۸۷۶۶۱

22 January 2022

The first container vessel to use these routes is scheduled to dock at Chabahar Port on Feb. 16, according to the caretaker of Ports and Maritime Organization’s Economic Affairs Department.

“Shipping on these routes will be in collaboration with the Islamic Republic of Iran Shipping Line Group and take container ships between 10 and 15 days to travel between the ports of Iran and India,” Jalil Eslami was also quoted as saying by IRNA.

The official noted that PMO plans to grant incentives and discounts on tariffs and shipping fees on these routes.

Jawaharlal Nehru Port Trust or JLN Port, also known as Nhava Sheva Port, is the largest container port in India.

Kandla, officially Deendayal Port, is a seaport and town in Kutch district of Gujarat state in Western India, near the city of Gandhidham. Located on the Gulf of Kutch, it is one of the major ports on the west coast.

Eslami noted that Chabahar Port’s throughput since the beginning of the current Iranian year on March 21 up until Jan. 19 registered a 36% rise compared with the similar period of last year.

Unloading of essential goods at the port registered a 62% year-on-year increase during the same period.

International Connectivity Hub

Located on the energy-rich Iran's southern coast, Chabahar is being developed by India, Iran and Afghanistan to boost trade ties.

The bilateral contract between Iran and India was signed on May 23, 2016, with a total value of $85 million for equipping, mechanizing and starting operations at the port under the first phase.

In this regard, a special purpose vehicle – India Ports Global Ltd (IPGL), Mumbai – was incorporated under the shipping ministry.

The development of Chabahar Port will help expand economic and mutual relations between India and Iran, as well as give a further boost to maritime trade between the two countries.

The location of Chabahar Port has strategic advantage and high potential to provide connectivity among India, Iran, Afghanistan, Uzbekistan and other Commonwealth of Independent States countries, especially eastern CIS nations, and boost trade.

According to the Diplomat, the port has a number of distinguishing features that make it attractive from both domestic and international perspectives.

Located on the edge of the Indian Ocean, it is the only deep-sea port in Iran with direct ocean access. Its geographic proximity to countries such as Afghanistan, Pakistan and India, as well as its status as a key transit center on the burgeoning International North-South Transport Corridor, gives it the potential to develop into one of the most important commercial hubs in the region.

Chabahar is also one of the few places in Iran that is exempt from US sanctions, which significantly simplifies trade procedures with other countries.

The construction of a port project in the Iranian city of Chabahar has been gaining increased attention as a potential global trading hub and an arena for geopolitical competition. India has served as the primary investor in Chabahar Port, as New Delhi sees the port as a way to access Afghan and Central Asian markets without relying on Pakistan’s land routes.

Furthermore, the port could strengthen Indo-Iranian ties, which could balance out growing Sino-Pakistani cooperation.

With India and China competing to invest in this harbor, Iran is trying to play the two rivals off each other to boost its own international standing while not becoming dominated by either one of these powers. Chabahar Port is thus a key case study in both international collaboration and competition: It could offer a trade revolution in the area, but it could also exacerbate regional rivalries.

The port has the capacity to transform trade in South and Central Asia. The proposed land-based trade routes linked to the port would facilitate greater access to the Afghan and Central Asian markets. The impact of this increased connectivity has enormous implications for Afghanistan in particular, although the fallout from the Taliban’s rapid takeover of the country could jeopardize these plans moving forward.

Currently, Afghanistan conducts most of its trade via routes through Pakistan and Chabahar Port could provide an alternative trade outlet for the country. In turn, Chabahar has the potential to generate massive economic growth in Afghanistan, as it would allow goods from other countries to more easily enter the country and bolster its export potential.

Iran Offers to Assist India in Transporting Aid to Afghanistan

Iran has offered to assist India in the transportation of wheat, medicines and coronavirus vaccines to Afghanistan, which has been reeling under a serious humanitarian crisis.

The offer was made by Iranian Foreign Minister Hossein Amir-Abdollahian during a recent telephone conversation with Indian External Affairs Minister S Jaishankar, according to the Iranian Foreign Ministry.

In the conversation, the Iranian minister also called for the formation of an inclusive government in Kabul.

“Regarding Afghanistan, Amir-Abdollahian stressed the need to form an inclusive government in the country. He also referred to India’s humanitarian aid to Afghanistan, announcing measures and cooperation by the Islamic Republic of Iran to transfer this aid in the form of wheat, medicine and Covid-19 vaccine to the country,” it said in a statement.

Iran and Afghanistan share a nearly 920-km-long border.

India has already sent three separate consignments of life-saving medicines and Covid-19 vaccines to Afghanistan. While the first consignment was sent on a special charter flight that brought 104 people to New Delhi from Kabul, the subsequent aid was sent to Kabul via a flight of Iran’s Mahan Air.

However, India is yet to deliver 50,000 tons of wheat it had pledged to supply to Afghanistan, as modalities for transporting the aid to the war-torn country through Pakistan are yet to be thrashed out with Islamabad.

There is an option for India to send aid to Afghanistan via Iran’s Chabahar Port.

The freezing of non-humanitarian funding by major donors to Afghanistan following its takeover by the Taliban in August has led to a severe economic crisis that deepened the humanitarian crisis.

US Sanctions Have No Bearing on Chabahar Port Project: Indian FM

The US sanctions on Iran have not affected India’s Chabahar Port project, India’s External Affairs Minister S. Jaishankar told Lok Sabha (the lower house of India's bicameral parliament), on Dec. 10.

Replying to a question from BSP member Ritesh Pandey, the minister also clarified that the US sanctions are “not relevant” to India’s Chabahar Port project in Iran “at all”, The Hindu reported.

During the Question Hour, Pandey sought to know from the government if the US sanctions on Iran had any bearing on India’s project at the Chabahar Port and claimed that the Iranian government is “publicly saying that our Chabahar Port project has been miserably delayed” due to sanctions imposed by the US.

The BSP member also claimed that he is “aware” of China trying to work on the project by taking advantage of the US sanctions on Iran as it did “with the rail link”. He also asked the government if it is working on a “solution”.

“I would like to inform the member that [his] assertion is completely inaccurate. This agreement was signed in 2016. We took possession of the terminal in 2018. We have already supplied six cranes. The terminal is fully functional,” Jaishankar said.

“The US sanctions are not relevant to this project at all,” he said in his reply.

In a supplementary question, the BSP member sought to know from the government if India has signed “any backdoor agreement” to continue using Chabahar Port to provide help to Central Asian countries and Afghanistan after Taliban took control of the Afghanistan government.

“All our agreements on the Chabahar Port operations are limited to Iran. Originally, there was a trilateral agreement but that was the basis to set it up. In terms of port operations, we are not required to have any agreement with the government of Afghanistan. And, I assure you that the port is functioning and functioning back,” Jaishankar said in his reply.