India started interacting with Iran with respect to Chabahar Port around 2003 but a major push was given only in the second half of 2014 by the Modi Government. This resulted in the signing of an MoU in May 2015 between the two countries for the development of Chabahar Port.
This MoU was then transformed into a formal 10-year contract for Equipping and Operating the Chabahar Port, which was executed on May 23, 2016, during Prime Minister Narendra Modi’s visit to Tehran. Under the agreement signed between India and Iran, India was to equip and operate two berths in Chabahar Port Phase-I with capital investment of $85.21 million and annual revenue expenditure of $22.95 million on a 10-year lease.
The first phase of the Chabahar port was inaugurated in December 2017 by Iranian President Hassan Rouhani, opening a new strategic route connecting Iran, India and Afghanistan bypassing Pakistan.
Since there were challenges in activation of the said contract, the foundation of an interim period contract was laid during the visit of Hassan Rouhani, President of Islamic Republic of Iran to New Delhi in February 2018. Resultantly, a formal short term Contract between the two sides was signed on May 6, 2018.
The Chabahar port in the Sistan-Baluchistan province in the energy-rich nation’s southern coast is easily accessible from India’s western coast and is increasingly seen as a counter to Pakistan’s Gwadar Port located at distance of around 80 km from Chabahar. The Chabahar port is being considered as a gateway to golden opportunities for trade by India, Iran and Afghanistan with central Asian countries, besides ramping up trade among the three countries in the wake of Pakistan denying transit access to New Delhi.
Now India has taken over operations of the strategic Chabahar port in the Sistan-Baluchistan province of energy-rich Iran’s southern coast, the government of India said on Monday. This is the first time India will be operating a port outside its territory. The heads of Indian, Iranian and Afghanistan delegation jointly inaugurated the office of the Indian SPV – India Ports Global Chabahar Free Zone (IPGCFZ) at Chabahar.
“The Government of India took over the operations of a part of Shahid Beheshti Port, Chabahar, in Iran during the Chabahar Trilateral Agreement meeting held there on December 24, 2018,” the shipping ministry said in a statement here.
“The physical take-over of the terminal area, cargo handling equipment and Office building was completed by December 29, 2018,” the statement said.
Commercial operations began at IPGCFZ with the arrival of a vessel, it said adding, a Cyprus registered bulk carrier had arrived at Chabahar with 72,458 MT of corn cargo.
The vessel MV Macheras berthed at the terminal at 0130 hrs on December 30, 2018, and IPGCFZ carried out its first cargo operation by discharging the imported cargo(ex Brazil) using pneumatic un-loaders, it added. This step marks the beginning of a long journey. India has written a history with its engagement in Chabahar and is now leading the regional cooperation and joint efforts to support land locked Afghanistan. This is the first time India will be operating a port outside its territories.