India to operate a terminal of Iranian Chabahar Port for next 10 years

India and Iran have signed an agreement on 13 May 2024 under which India will operate the strategically important Shahid Beheshti terminal of Chabahar Port of Iran for the next 10 years . Till now India operated the Shahid Beheshti Port of Chabahar on a short term contract which was renewed periodically .This is the first international terminal which will be operated by India.

10 year agreement signed for operation of Shahid Beheshti Terminal

The agreement was signed in the Iranian capital city of Tehran by the Indian Ports Global Ltd and the Port & Maritime Organisation (PMO) of Iran. The agreement was signed in the presence of  Union Minister for Ports, Shipping & Waterways Minister Sarbananda Sonowal and Iranian Minister for Roads & Urban Development Mehrdad Bazrpash. 

Main Points of the India-Iran Agreement 

• The Chabahar Port of Iran has two terminals, Shahid Beheshti and Shahid Kalantari. India has got the contract to operate the Shahid Beheshti terminal only.
• India will operate the Shahid Beheshti terminal of Chabahar Port for the next 10 years, and the contract will be renewed for another 10 years automatically.
• It will replace the agreement signed in 2016 which gave the Indian Ports Global Ltd the right to operate the Shahid Beheshti Port for one year. The contract was renewed after every one year.
• As part of the agreement the  India Ports Global Ltd (IPGL) will invest around  $120 million in developing the Shahid Beheshti terminal .
• To improve the rail and road infrastructure for better connectivity to the terminal the government of India has given $250 million to Iran.

About Chabahar Port 

• The Chabahar port is Iran’s only oceanic port situated on the Gulf of Oman and provides Iran direct access to the Indian ocean.
• The Chabahar port is located on the Makran coast in Iran’s Sistan-Baluchestan Province. 
• The Chabahar port consists of Shahid Kalantari and Shahid Beheshti terminals. Each terminal has five berths each.
• The port is located about 120 kilometres southwest of Pakistan’s Baluchistan Province, where the China-funded Gwadar port is situated.
• The nearest Indian port to Chabahar is the Kandla port in Gujarat. It is 550 Nautical Miles from Kandla, while the distance between Chabahar and Mumbai is 786 Nautical Miles.

Importance of Chabahar Port for India

India’s access to landlocked Afghanistan and Central Asian countries is through Pakistan. However, due to the difficult relationship between Pakistan and India, Pakistan has almost consistently denied transit routes to the Indian goods destined for these countries.

• Afghanistan and Central Asian countries are strategically important for India, and to gain access to these regions, India has identified the Chabahar port and the International North-South Transport Corridor (INSTC).
• Both the Chabahar Port and the INSTC will bypass Pakistan and will provide an access to India to the Afghanistan and Central Asian markets.
• In 2013 India agreed to invest $100 million in the Chabahar port for its upgraditon. India has also invested in developing multi-modal connectivity from the Chabahar port to Afghanistan and Central Asia.
• In 2016 during the visit to Iran by prime minister Narendra Modi an agreement was signed between the  two countries to develop the port.
• The first phase of the Shahid Beheshti terminal was inaugurated in December 2017, and India used the terminal to send wheat to Afghanistan in 2017.
• In 2019, the  IPGL formally took over the operations of the Shahid Beheshti terminal. 
• The Chabahar port is also part of the 7200 km long International North-South Transport Corridor (INSTC). The INSTC is a multi-mode transportation route linking the Indian Ocean, Persian Gulf, to the Caspian Sea through Iran. It will link India, Iran, Afghanistan, Armenia, Azerbaijan, Central Asia and Europe via Saint Petersburg in Russia.

India Ports Global Limited 

India Ports Global Limited is a public sector company which is a subsidiary of Sagarmala Development Company Limited. It is under the administrative control of the Union Ministry of Ports, Shipping and Waterways.

It was set up in 2015 primarily to develop and operate the  Shahid Beheshti terminal of the Chabahar Port.

Managing Director : Sunil Mukundan 

Headquarters: Mumbai, Maharashtra