Chabahar Port and Afghanistan have signed a memorandum of understanding on Wednesday to expand cooperation in transportation, transit, investment and logistics.
“Based on the MoU, the Afghan private sector has agreed to boost cargo transit traffic through Chabahar’s Shahid Beheshti Port. Chabahar Port Authority, in turn, has agreed to allocate land for Afghan companies as well as cargo storage, and to grant discounts and facilities based on the generated traffic,” Director General of Sistan-Baluchestan Ports and Maritime Organization Behrouz Aqaei was quoted as saying by the Ministry of Roads and Urban Development’s news portal.
Chabahar is Iran’s only oceanic port town located in Sistan-Baluchestan Province and consists of two separate terminals: Shahid Kalantari and Shahid Beheshti on Iran’s coast along the Sea of Oman.
The Asian Development Bank said in a recent report that although Afghanistan has traditionally relied on Pakistan as a gateway to international shipping routes, recent trends indicate that 70% of Afghan transit trade are now diverted through Iran.
The ADB’s Corridor Performance Measurement and Monitoring Annual Report 2019 states that Pakistan is still facing challenges in terms of removing barriers for road transport, Ariana News reported.
This shift away from Pakistan has been driven by lower costs from foreign ports and more attractive security deposit and detention tariffs for transit containers from shipping lines that operate at Iran’s seaports.
The report stated that in addition, diesel fuel in Iran ($0.06 per liter) is significantly less expensive than in Pakistan ($0.86 per liter), which provides an additional edge in terms of cost competitiveness.
Also, in the absence of a formal agreement with Pakistan, shippers and carriers face uncertainty in transit procedures, it added.
The first shipment of Afghanistan’s transit goods has been shipped to China through Shahid Beheshti of Chabahar Port in southern Iran, Mehr News Agency reported last month.
Aqaei said while the world is affected by the coronavirus pandemic, Chabahar's Shahid Beheshti has taken a big step to facilitate trade between Central Asian countries and Afghanistan with the countries of South and Southeast Asia and the Far East by establishing regular container transportation services.
Stating that Afghanistan’s first transit shipment of dried fruit was sent to Tianjin Port in China, he said the cargo was sent to the Indian port of Mundra via Chabahar, which was unloaded at this port and loaded on another ship to its final destination.
During the past month, Afghanistan sent three transit consignments to India via Shahid Beheshti.
In 2016, Iran, India and Afghanistan decided to jointly establish a trade route for landlocked Central Asian countries.
