India proceeds with Iran port upgrade against US advice

India wants to upgrade the Iranian port of Chabahar and use it to bypass Pakistan
India wants to upgrade the Iranian port of Chabahar and use it to bypass Pakistan
India wants to upgrade the Iranian port of Chabahar and use it to bypass Pakistan

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India will proceed with a US $85-million joint venture plan to upgrade the Iranian port of Chabahar, despite US political pressure to maintain sanctions, India’s ministry of external affairs has confirmed.

Indian shipping minister Nitin Gadkari and Iranian Transport Minister Abbas Ahmad Akhoundi signed the memorandum of understanding (MOU) for the investment at the end of last week.

“With the signing of this MOU, Indian and Iranian commercial entities would now be in a position to commence negotiations towards finalization of a commercial contract under which Indian firms will lease two existing berths at the Port and operationalize them as container and multi-purpose cargo terminals,” read statement from the ministry.

India is seeking to upgrade port facilities at Chabahar to take advantage of the port as a route for cargo to and from Central Asia and Afghanistan, bypassing regional rival Pakistan and the disputed territory of Kashmir.

The investment has been an ambition of India’s for more than a decade, but until this year has been stalled by sanctions on Iran over its nuclear program. Those sanctions are now expected to be relaxed or eliminated on the back of a nuclear framework agreement.

The US government has urged India to wait until the agreement has been finalised in June, 2015.

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