India-US Relations: US Warns Against India’s Chabahar Pact with Iran

The port on the Gulf of Oman will provide Indian goods a gateway to reach landlocked Afghanistan and Central Asia using a road and rail project called International North-South Transport Corridor. This route bypasses Pakistan. India had first proposed this plan back in 2003, but US sanctions on Iran over its suspected nuclear programme slowed down the port’s development. I will just say, as it relates to the United States, US sanctions on Iran remain in place and we will continue to enforce them.

He added that “anyone considering business deals with Iran, they need to be aware of the potential risk that they are opening themselves up to and the potential risk of sanctions”. When a reporter asked if there’s any exemption for this, Mr Patel responded, “No”. IPGL will invest about $120 million and another $250 million will be raised as debt. The new pact replaces a 2016 agreement, which covered India’s operations at Shahid Beheshti terminal in Chabahar port and was renewed annually.

This is the first time India takes over the management of an overseas port that is expected to boost exponentially trade among India, Iran and Afghanistan. The Ministry of External Affairs has allocated Rs 100 crore for the Chabahar Port for 2024-25. “This 10 years long term lease agreement further strengthens the bilateral ties between the two countries while bolstering confidence and boosting trust of trading communities from the region,” the statement added. The Chabahar port is being projected as a key hub for the International North-South Transport Corridor project — a 7,200-km-long multimode transport project for moving freight between India, Iran, Afghanistan, Armenia, Azerbaijan, Russia, Central Asia and Europe.

Discussions on developing Chabahar Port were first held in 2003 during then Iranian President Muhammad Khatami’s visit to India. In 2013, India committed to investing $100 million towards its development. The contract was executed in 2016 during Prime Minister Narendra Modi’s trip to Iran. The Kandla port in Gujarat is the closest to Chabahar port at 550 Nautical Miles.

The distance between Chabahar and Mumbai is 786 Nautical Miles.