India to sign pact with Iran soon to ship goods to Afghanistan
India and Iran have agreed to draw up a transit pact for transporting goods to Afghanistan, which has also resulted in the government moving a cabinet note on investing over $100 million in the expansion of the Chabahar port that could act as a hub for this arrangement, The Indian Express Daily News reported on March 24.
A sources said anonymously to The Indian Express that the Chinese decision to literally take over the running and management of Gwadar port in Pakistan lent urgency to this long-delayed project. Located along the same coast, the two ports are just over 70 km from each other.
Also, the fact that Iran and Pakistan have decided to go ahead with their gas pipeline project despite US warnings has put India on alert about Tehran's other options. Presidents Mahmoud Ahmadinejad and Asif Ali Zardari inaugurated the construction of this pipeline project at Chabahar, a signal India cannot overlook.
Sources said it would be in India's interest to harness Chabahar port's potential soon enough to ensure a link into Afghanistan for its goods, which bypasses Pakistan. India, Iran and Afghanistan already have a joint working group, which is supposed to work out the details of implementing this plan.
The government is examining three options for investment in the port, focused on improving the berthing facility and expansion of the container terminal.
India is likely to have to bear almost the entire burden of construction. Iran, on the other hand, has prepared the road connecting Chabahar to Zaranj on the Iran-Afghan border.
A transit agreement has its own significance given that India was left out of the Afghanistan-Pakistan Transit Trade Agreement because of objections from Islamabad.
South Block officials pointed out that investment in port infrastructure is among the identified areas that will not attract US sanctions. With financial institutions in India wary of Iran-related business, the government will have to muscle its way to ensure Chabahar moves forward.