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December 10, 2023

PM Modi Meets Iranian President Raisi, Discuss Chabahar Port, Afghanistan

By Aakanksha Nigam

On the eve of The 22nd Shanghai Cooperation Organization Summit, held in Samarkand, an ancient Uzbek city. Prime Minister Narendra Modi had his first face-to-face meeting with Iranian President Ebrahim Raisi on Friday. The two leaders spoke about their extensive bilateral relations as well as regional and Afghan events. The two parties have been working together to increase connectivity between Central Asia and South East Asia.

Chabahar Port in Iran has been envisioned by India as a significant regional transit hub that includes Afghanistan.

India, Iran, and Afghanistan are developing the Chabahar port, which is situated in the Sistan-Balochistan region on the energy-rich southern coast of Iran, in order to improve connectivity and trade links.

Following the Taliban’s takeover of the country on August 15 of last year, India has been in contact with Iran about the happenings in Afghanistan as well.

The Iran nuclear accord and bilateral cooperation were the main topics of a phone call earlier this month between Iranian Foreign Minister Hossein Amir-Abdollahian and Indian External Affairs Minister S Jaishankar.

The Delaram-Zaranj Highway, a 218 km road in the Nimruz province, was designed and built by the government of India at the request of Afghanistan for USD 175 million. It connects Afghanistan with Iran’s Zabul province to facilitate and speed up the transportation of products.

The Iranian province of Zabul is well connected to the Port of Chabahar by road. It is one of the busiest roads in Afghanistan and offers a crucial commerce route between Afghanistan, Iran, and the rest of Asia.

The Chabahar road, where 80% of Afghanistan’s freight traffic currently travels, is significantly shorter and more stable than any of the routes in Pakistan, making it possibly the most effective way for Afghan traders to reach the end destination for their commodities.

Additionally, the Chabahar route offers access to two markets with a combined population of 1.4 billion people rather than just one country with 200 million people.

Since the port started operating, Afghanistan’s reliance on Pakistan has substantially lessened, and trade with Pakistan dropped from USD 2.5 billion in 2017 to USD 500 million in 2018.

The lifeline Afghanistan needs to revive its trading potential is Chabahar Port, which is found in the Sistan-Baluchistan province of Iran.

 Such trade opportunities reduce expenses and provide more money for economic empowerment and global integration, which contribute to the prosperity and stability of the nation.

Iran and India constructed a multimodal system, and overall, the routes provide a 60 percent reduction in shipping costs and a 50 percent reduction in shipment time between Afghanistan-India and other Central Asian countries.

The trustworthy commerce and transit options offered by Chabahar have received positive feedback from Afghan businessmen. Iran and India have offered as advantageous a deal as possible to Afghan traders, starting with a 30% discount on customs fees, 50 acres of land for Afghan investment, and free cooling storage facilities.

By 2024, the nominal capacity of the Chabahar port is expected to be 86 million tonnes, and Afghanistan plans to play a significant role in these operations. Increased trade through the Chabahar port is Afghanistan’s best chance for a better future.

In addition, Chabahar offers direct shipping to Gujarat and Mumbai, the two states with the highest market potential for Afghanistan’s agricultural exports. India is the country that buys the majority of these products.

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