Amidst escalating tensions between Iran and Israel, India is keeping a close watch on the strategically important Chabahar Port and International North-South Transport Corridor (INSTC) projects. Last year, India signed a decade-long agreement with Iran, entrusting the Chabahar Port’s management to India Ports Global Ltd. The operations at Chabahar Port are jointly managed by IPGL, a collaboration between Jawaharlal Nehru Port Trust and Kandla Port Trust, working alongside Iran’s Aria Banader. India has committed substantial financial support, including $85 million for berth improvements and a $150 million credit line through Exim Bank.
India is monitoring potential effects on the Chabahar Port and International North-South Transport Corridor (INSTC) as tensions rise between Israel and Iran. These two Iranian connectivity initiatives serve as India’s crucial access points to Afghanistan, Central Asia and Russia, with substantial Indian investment in the port development. Whilst Israel has not directly struck any Iranian ports, there are accounts of strikes along Iran’s coastline.
The Taliban administration in Afghanistan has expressed interest in Chabahar and is considering joining INSTC to decrease its reliance on ports in Pakistan. Additionally, several Central Asian nations have demonstrated enthusiasm for this initiative.
Iran’s Chabahar port holds strategic importance for India to expand trade routes to Central Asia. Located on the Gulf of Oman, this port project was first suggested by India in 2003. It will provide a vital access point for Indian commodities to reach Afghanistan and Central Asian nations through the International North-South Transport Corridor, consisting of road and rail networks, without crossing Pakistani territory.
India’s involvement in developing Chabahar port stands as a response to Pakistan’s Gwadar port and China’s Belt and Road Initiative. India has secured operational control of Chabahar port, following its monetary contribution towards the port’s development.
This is India’s first venture into foreign port management. The port functions as an essential connectivity corridor linking India with Afghanistan, Central Asia and the broader Eurasian territories.
Functioning as a transit trade centre between India, Iran and Afghanistan, Chabahar port offers an alternative pathway to the conventional Silk Road that passes through China. The port’s advantageous position near the Strait of Hormuz and the Indian Ocean enhances its strategic value and future prospects.
