Economy, Domestic Economy

Caspian Trade, Transportation Potential High

Caspian Trade, Transportation Potential HighCaspian Trade, Transportation Potential High

Trade and transportation potentials of Caspian Sea is still largely untapped, and it can become Iran’s second largest economic hub after the Persian Gulf, said the managing director of Khazar Shipping Company, Iran’s largest fleet in the north.

“We must view the Caspian Sea as the connecting route between the Commonwealth of Independent States, especially Russia, and international waters, and consider the potential trade opportunities,” IRNA quoted Ali-Akbar Ghonji as saying.

“We have to reduce transportation costs and improve the shipping conditions to attract foreign traders,” he added.

He emphasized that with a strong fleet, Iran can compete with Kazakhs, Russians and Turkmen in goods transportation in the region.

“In the sixth five-year development plan (2016-21), Khazar Shipping Company’s fleet capacity is envisioned to increase from 97,200 tons to 150,000 tons, and the number of ships to increase to 30 and their average age to drop down to 18,” he said.

The official said Khazar Shipping Company has international horizons in mind and intends to start trade in the Volga and expand its transportation routes to the Black Sea by the end of the sixth plan.

He noted that fuel expenses account for 35% of total shipping costs and that the tripling of fuel costs has made it difficult for the company to achieve its long-term goals, calling on the government to support the national fleet by subsidizing fuel for shipping companies.

Khazar Shipping Company shipped 31% of Iran’s total 6.5 million tons of goods handled by domestic ports during the previous Iranian year (ended March 20, 2015).

From the largest inland body of water on earth, the Caspian Sea, about 650 square kilometers belong to Iran. The rest of it is shared by Kazakhstan in northeast, Russia in northwest, Azerbaijan in west, Iran in south and Turkmenistan in the southeast.

In addition to its abundant oil and gas resources, Caspian Sea provides littoral countries with significant opportunities for trade and transportation.