India sends first wheat shipment to Afghanistan through Iran

In news

India on Sunday flagged off a shipment of wheat for Afghanistan through Iran’s Chabahar port—marking the operationalization of the port for the trans-shipment of goods from India to the landlocked country.

The shipment was flagged off from the Kandla port in Gujarat with External Affairs Minister Sushma Swaraj and her Afghan counterpart Salahuddin Rabbani joining the ceremony through video conferencing.

What is its importance?

This is a major push for India’s Afghan outreach bypassing Pakistan — for the first time under the 2016 Indo-Afghan-Iran trilateral pact.

The shipment of wheat is a landmark moment as it will pave the way for operationalisation of the Chabahar port as an alternate, reliable and robust connectivity for Afghanistan.

In June, India and Afghanistan had launched an air freight corridor between the two countries to boost trade as Pakistan has been refusing land transit access through its territory.

When it started?

  • It was in 2003 that India and Iran first agreed to develop the Chabahar port, located in the Gulf of Oman near Iran’s border with Pakistan, to allow New Delhi to reach markets in Afghanistan and landlocked Central Asia.
  • The project was delayed due to international sanctions on Iran over its suspect nuclear programme and India’s focus on concluding a civil nuclear pact with the US. Interest in the project was rekindled in 2013 after Iran and the US, UK, France, Russia, China and Germany reached an interim agreement on Tehran’s nuclear programme and some sanctions were lifted.
  • And in May last year, India, Iran and Afghanistan signed a trilateral trade pact when Prime Minister Narendra Modi visited Tehran to enable the movement of goods from Chabahar to Afghanistan.
  • The Chabahar port is also less than 100km from Pakistan’s Chinese-built port of Gwadar, which is part of the China-Pakistan-Economic Corridor project (CPEC) aimed at opening up an energy and trade corridor from the Gulf to western China. The CPEC is also a strand of China’s ambitious Belt and Road Initiative that aims to connect around 60 countries across Asia, Africa and Europe through a series of roads, railways and ports.

Highlights

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India’s allotment of 235 million USD for Chabahar port expansion is divided into two parts -$150 million Line of Credit (LoC) from the EXIM Bank for development of port complex and $85 million – for supply of equipment to develop two berths in the port.

A Special Purpose Vehicle has been created by the Indian Shipping Ministry for development of phase two of the Iranian port. On the Iranian side, Ports and Management Organisation is the nodal authority for implementing the project

Way Forward

India is also constructing a railway line between Chabahar and Zahedan to connect the port to rest of the Iranian railway network. The port, through this railway network, could also be linked with the International North South Transport Corridor connecting India with Russia.

Chabhar is planned to be linked with Delaram-Zaranj road, built by India in Afghanistan that connects at Afghan-Iran border via rail through Zahedan.A road already connects the Iran-Afghan border point to Chabahar.

 

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