Indian operator in Iran’s Chabahar port to make payments in rupees

Business Materials 15 January 2019 17:17 (UTC +04:00)

Baku, Azerbaijan, Jan. 15

By Elnur Baghishov – Trend:

The Indian Ports Global Limited (IPGL) started to operate at the Iranian Chabahar port on December 22 this Iranian year (started on March 21, 2018), Deputy Chairman of the Iranian Ports and Maritime Organization Mohammed Ali Hasanzadeh said.

The Indian side has officially begun to operate at the Iranian Shahid Beheshti and Shahid Kalantari ports since January 5, Hasanzadeh added, Trend reports referring to Mehr News Agency.

This process must be implemented in accordance with the trilateral agreement signed between Iran, India and Afghanistan, known as the Chabahar agreement, he said.

The activity of the Indian operator in Chabahar port will last one year and a half upon the temporary contract. Then it will operate for 10 years upon the fixed-term contract, Hasanzadeh said.

Besides cargo loading and unloading, India will also supply and install equipment, as well as deal with marketing, he added.

Taking into account the fact that the Chabahar port is excluded from the US sanctions, it has enabled the development of the port and increased transit of goods to Afghanistan and Central Asian countries, he said.

For the first time in Iran, a foreign company took over operation of a port, he said.

As for India’s investments in Chabahar port, India will invest small amount upon an 18-month-temporary contract because the Iranian Ports and Maritime Organization bought and installed most of the equipment, Hasanzadeh said.

India will make investments worth $85 million in Shahid Beheshti port during the 10-year operation of IPGL company, he said.

The Indian operator must deal with the 1st phase of the Shahid Behishti port development project. Other local or foreign investors can invest in the 2nd, 3rd and 4th phases of this port, he said.

India's investment agreement in Chabahar is a build-operate-transfer (BOT) agreement. So, India invests, buys equipment. After 10 years, this equipment is transported to the Iranian Ports and Maritime Organization, he added.

The Indian operator will make payments in rupee on a contract basis in the first 18 months. The amount paid by the Indian side has not been disclosed, Hasanzadeh noted.

Thus, 1.5 million tons of goods were loaded at the Chabahar port this Iranian year (started on March 21, 2018), which is one percent of the total load at the country's ports, he said.

Moreover, 120,000 tons of that volume accounted for India's transit cargo to Chabahar port. No transit cargo has been loaded at Chabahar port except for India's cargo, Hasanzadeh said.