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China, India Vying for Chabahar Project
Economy, Business And Markets

China, India Vying for Chabahar Project

China and India remain interested in developing Iran’s Chabahar Port, regarding it as a project with huge potential to encourage the regional shipping industry.
Chabahar Port’s development project is ambitious in attracting many foreign investors due to its favorable location in southeastern Iran and the prospects of restoring the Silk Road.
The region considers it an alternative route to trade with Europe, wrote Azernews.
China faces a problem with pirates in the Mediterranean Sea and the Gulf of Aden, which appear to have significant influence over its foreign trade.
Creating the Silk Road marine route through Chabahar Port would ensure China’s access to Central Asia and Afghanistan.
Aspiring to elevate its sanctions-hit economy, Iran welcomes China’s investments in the development of Chabahar Port in its southeastern Sistan-Baluchestan Province.
Iran is calling on Chinese enterprises to participate in a series of projects in Chabahar, including the development of a rail network and key petrochemical and steel projects.
Tehran says it is ready to provide lucrative business opportunities to the countries that stood by it during hard times.
“We will be glad to work with China to make our relations solid and strong,” IRNA quoted the governor general of Sistan-Baluchestan Province as saying.
Ali Osat Hashemi added that he is scheduled to meet the ambassadors of China and Pakistan in Tehran to discuss potential investments in Chabahar.
As many as 36 states have signed transport agreements on using the port, but none has materialized yet.
China is ready to contribute to their implementation.
Chabahar Port should have and international status, but at present it does not have access to a railroad.
Chinese goods are shipped to the Iranian ports of Bandar Abbas and Chabahar through the port of Dubai. Access to Chabahar Port would significantly simplify this process.
China has at its disposal the Pakistani Gwadar Port but this is obviously not enough.
India’s media reported earlier that the presence of a cargo terminal in Chabahar Port will provide neighboring Afghanistan with an alternative route to the port and significantly boost its role in regional and global markets.
The port is largely planned to be developed through a much-awaited investment by India, while the exact scope of China’s planned investment in Chabahar is not yet known.
India has expressed readiness to invest over $30 billion in Chabahar Special Economic Zone but the investments would depend on gas prices, transport and shipping, according to a recent announcement by Indian Minister of Road Transport and Highways Nitin Gadkari.
Gadkari made these statements during a meeting with Indian Prime Minister Narendra Modi this month while discussing investment proposals on Chabahar.
Gadkari said Indian companies are ready to invest in various projects in Iran ranging from road and rail to shipping and agriculture.
Earlier, India and Iran discussed the possibility of developing Chabahar Port, which would give India access to Afghanistan by sea, bypassing Pakistan.
The port will be connected to Zahedan on the Iran-Afghan border through a railroad, which will also be built by the Indian construction company IRCON.
The port will also be used to ship crude oil and urea, cutting transport costs and freight time from India to Central Asia and the Persian Gulf by about a third.
India, the world’s fourth-largest petroleum consumer, is Iran’s second largest oil customer after China, and purchases around $12 billion worth of Iranian crude every year, about 12% of its domestic consumption.
It is central to India’s efforts to circumvent archrival Pakistan and open up a route to landlocked Afghanistan where it has developed close security ties and economic interests.
The port can also serve as a gateway to the resource-rich countries of Central Asia.
Iran and India agreed to develop Chabahar Port in 2003, however, their plans have not been realized because of western sanctions against Iran over its nuclear program.

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