Iran Builds New Oil Terminal At Chabahar Port To Better Trade Crude With India, Others
The Iranian oil industry has constructed a new terminal at the country's southeastern port of Chabahar to meet rising crude export capacity, and to better serve markets in India and central Asia.
Chabahar along the Gulf of Oman is the closest and best access point of Iran to the Indian Ocean and Iran has devised serious plans to turn it into a transit hub for immediate access to markets in the northern part of the Indian Ocean and Central Asia.
The Chabahar Agreement is a regional transport network initiative of the governments of Afghanistan, India, and Iran. India will be handling much of the construction and management at the new facilities: under the agreement signed between India and Iran, India is to equip and operate two berths in Chabahar Port Phase-I with capital investment of USD 85.21 million and annual revenue expenditure of USD 22.95 million on a 10-year lease.
This new port and transit corridor erves as a key lifeline for Iran under US sanctions (more of which were just approved today by the administration). It could also potentially open the way for millions of dollars in trade for Afghanistan thus cutting its dependence on Pakistan's port of Gwadar, located 166 km (103 miles) to the east.
Iran to build new oil terminal at Chabahar port, official says
22 August 2018 14:00 (UTC+04:00)
An official with National Iranian Oil Products Distribution Company said the country plans to build a new oil terminal at the strategic southeastern port of Chabahar to meet its rising crude export capacity.
A new oil terminal with a capacity of 50,000 tons will be set up at Chabahr port as old oil terminals there are facing problems loading, unloading and storing oil barrels, Shahram Rezaei said, Shana news agency reported on August 20.
The construction of a dock for oil import and export, as well as oil storage facilities, and the presence of public and private sector petrochemical companies in Chabahar can help facilitate oil trade.
He further said a multi-purpose terminal would come on stream at Shahid Beheshti Port in Chabahar soon.
Chabahar is the closest and best access point of Iran to the Indian Ocean and Iran has devised serious plans to turn it into a transit hub for immediate access to markets in the northern part of the Indian Ocean and Central Asia.
The Chabahar Agreement is a regional transport network initiative of the governments of Afghanistan, India, and Iran.
It aims to create a reliable transport corridor for the smooth transport and transit of goods and services through Chabahar Port between the Islamic Republic of Afghanistan, Republic of India, and Islamic Republic of Iran.
The agreement was signed by the three countries' high ranking officials in Tehran in May 2016.
link to www.reuters.com
January 8, 2019 / 3:39 AM / 6 months ago
India hopes to start full operations soon at Iran's Chabahar port: minister
NEW DELHI (Reuters) - India hopes to soon start full operations at a portion of Iran's port of Chabahar as the two countries are close to resolving various disputes including financing, the country's roads minister said on Tuesday.
FILE PHOTO: India's Transport and Shipping Minister Nitin Gadkari (L) looks at a paper as he speaks on his mobile phone at his office in New Delhi, India, August 26, 2015. REUTERS/Anindito Mukherjee
The Indian-backed Chabahar port complex on Iran's coast along the Gulf of Oman is being developed as a transportation corridor for land-locked Afghanistan.
In May 2016, India signed a deal with Iran to develop two terminals with five berths at the Shahid Beheshti area in Chabahar.
Under the agreement, India would build a 600-metre (1,969 feet) cargo terminal and a 640-metre container terminal. However, only a portion of the two berths have been finished because of deteriorating relations between the United States and Iran after the election of President Donald Trump in November 2016 that culminated with the reimpositon of economic sanctions last year.
In December, India took over operations at part of the Shahid Beheshti port, according to a statement from the Ministry of Shipping released on Monday.
On Tuesday, Nitin Gadkari, India's Minster of Road Transport, met with Iran's Foreign Minister Mohammad Javad Zarif in New Delhi. After the meeting he said the two sides were close to resolving various issues, including over banking payment mechanisms to overcome the U.S. sanctions.
"Regarding the machinery orders and others, already the financial arrangement is ready," said Gadkari. "There are some problems but we have resolved the issue."
India has already received a shipment of corn from Brazil at Shahid Beheshti with the help of Iranian operators, Gadkari told reporters.
India, Iran's top oil buyer after China, will pay for crude imports in rupees to UCO Bank (UCBK.NS). Tehran will use the funds for importing goods from India.
Zarif said India's UCO bank and Iran's Bank Pasargad will start transactions despite the U.S. sanctions.
Mohammad Amir Davoud, deputy chief executive at Bank Pasargad said his bank will open its first Indian branch in western city of Mumbai in three to four months to facilitate transactions.
Gadkari also said Iran had shown interest in buying rails from India and New Delhi had already placed a $85 million machinery order for the port. Iran had shown interest in buying rails and 250 to 300 locomotive engines from India, he said.
Indian firm Ircon is building a railway from Chabahar.
The new port could potentially open the way for millions of dollars in trade for Afghanistan and cut its dependence on Pakistan's port of Gwadar, located 166 km (103 miles) to the east.
Reporting by Nidhi Verma; Editing by Christian Schmollinger
link to www.business-standard.com
India takes over operations of Chabahar port in Iran's southern coast: Govt
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
Press Trust of India | New Delhi Last Updated at January 8, 2019 02:01 IST
First Published: Mon, January 07 2019. 17:55 IST
India has taken over operations of the strategic Chabahar port in the Sistan-Balochistan province of energy-rich Iran's southern coast, the government said Monday.
This is the first time India will be operating a port outside its territory.
"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 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 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," the statement said.
India started interacting with Iran on Chabahar Port around 2003 but a major push was received in the second half of 2014, resulting in the signing of an MoU between the two countries for the development of Chabahar Port in May 2015.
This MoU translated 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.
"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 statement said.
The Chabahar port in the Sistan-Balochistan 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 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.
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.
Under the agreement signed between India and Iran earlier, India is to equip and operate two berths in Chabahar Port Phase-I with capital investment of USD 85.21 million and annual revenue expenditure of USD 22.95 million on a 10-year lease.
link to www.atlanticcouncil.org
June 19, 2019
Iran Looks to Chabahar and a New Transit Corridor to Survive US Sanctions
By Aveek Sen
The Trump administration has exempted the Chabahar port from US sanctions as a gesture toward India, which sees the outpost as a means of facilitating trade with Afghanistan. However, its true potential requires more integration between Iran and among Central Asian states.
Muddassir Quamar, associate fellow at the Institute for Defence Studies and Analyses, a New Delhi think tank, told this author that trade with any country—not just Afghanistan—through Chabahar port is not under sanctions.
However, Erich Ferrari, a leading sanctions lawyer in Washington, disagreed. He said, "According to my understanding, the waiver for Chabahar port was issued by the State Department for the purpose of reconstruction and development of Afghanistan and operation of Iran's Chabahar port by India for these ends. Based on the reporting in the media, it doesn't appear that the waiver would cover trade with other countries."
The author spoke to Omid Rahimi, an Iranian researcher on Central Asia, on the potential of Chabahar for Iran and the economies of Iran's Central Asian neighbors:
Kazakhstan, as the biggest economy of the region, stands to benefit more from Chabahar than other Central Asian states. The Kazakh ambassador to Iran Askhat Orazbai emphasized that his country is ready to invest in Chabahar. The Incheboron Railway connects Kazakhstan to Chabahar via Turkmenistan and Gorgan, a city in Iran. Kazakhstan already has a consulate in Bandar Abbas on the Persian Gulf and Iran has allocated land for Kazakh logistical terminals in Chabahar. One possibility is that Kazakhstan could enter into an oil swap deal with Iran and export its oil from Chabahar. Kazakhstan has also joined the new corridor of Uzbekistan-Turkmenistan-Iran-Oman which includes Chabahar.
Kyrgyzstan has signed an agreement with the Chabahar Free Zone about logistics and transit. But the economy of Kyrgyzstan is very small. Worker remittances and export of minerals form the major part of its GDP. If Iran were to reach a free trade agreement with the Eurasian Economic Union (EEU)—which also includes Russia, Belarus, Kazakhstan and Armenia—it could lead to greater trade via Chabahar.
Iran-Tajik relations are complicated. During a recent visit to Iran by the Tajik foreign minister, Behrooz Aghaei, the director general of ports in Sistan and Baluchistan province, said, "Chabahar is the best option for Tajikistan compared to other Iranian ports due to its exemption from US sanctions."
However, Tajikistan has the poorest economy of former Soviet republics and remittances by Tajik workers in Russia provide a major part of Tajikistan's GDP. The country's main trading partners are Russia, China, Kazakhstan and Turkey. According to data from the Observatory of Economic Complexity of the MIT Media Lab, 60.5 percent of exports and 86 percent of Tajik imports go to these four countries. Another issue is the poor state of Tajikistan - Turkmenistan relations. Recently, cargo from Tajikistan faced problems passing through Turkmenistan. Without stating any reasons, Turkmenistan stopped trucks bound for Tajikistan from entering from Iran. At the border with Uzbekistan, trucks destined to and from Tajikistan were also stopped. Trucks transporting goods to other countries, including Uzbekistan and Kyrgyzstan, were allowed to cross the Turkmen border unrestrained last August and in February this year. Turkmen authorities said that the trucks that were stopped were because of security purposes and to combat "drug trafficking."
Until transit issues are resolved, there is no available route from Tajikistan to Iran apart from though Afghanistan. Russia has repeatedly asked Tajikistan to join the EEU, but Tajikistan has refused.
According to Rahimi, a member of Turkmenistan's Chamber of Commerce visited Chabahar and expressed interest in exporting via the port. Turkmenistan can play an important role in the International North South Transport Corridor (INSTC), an agreement which was signed between India, Iran, and Russia in 2000 but is only now being completed. The INSTC is to connect India, Iran and Russia via the railway routes of Sarakhs and Incheboron. However, Turkmenistan's behavior regarding this corridor has been unpredictable.
President Shavkat Mirziyoyev of Uzbekistan needs new transit routes. But there are political problems. Iran and Uzbekistan did not have good relations during the presidency of Mirziyoyev's predecessor, Islam Karimov. Mirziyoyev has shown interest in improving ties but does not want to antagonize the US. A scheduled visit to Uzbekistan last year by Iranian President Hassan Rouhani was cancelled. Recently, Kamal Kharazi, a former Iranian foreign minister and senior adviser to Supreme Leader Ali Khamenei, visited Uzbekistan to discuss the transit corridor. The deputy prime minister of Uzbekistan visited Chabahar last year. The special representative of the Uzbek president in Afghanistan has also talked about connecting Uzbekistan to Chabahar via Afghanistan.
In addition to trade with Central Asian nations, there is great potential for Iranian trade with its neighbor in the Caucausus, Azerbaijan. Azerbaijan last year allocated $500 million to Iran to facilitate completion of the Rasht-Astara railway. A trilateral meeting of the leaders of Russia, Azerbaijan and Iran will be held in Sochi soon. The main agenda is the INSTC. If everything goes according to plan, the route from India through Iran, Azerbaijan and then Russia andon to Europe will be launched next year.
Daniel Khazeni-Rád, a journalist covering Eurasia, told this author that the INSTC is a potential game changer for the countries along the multi-modal transport system. Farhad Ibragimov, a Moscow-based expert on the INSTC, added that the project could make countries along the route more attractive to foreign investors. Beyond Russia and India, the developed countries of Southeast Asia are ready to join.
In its initial stage, the North-South corridor is planned to transport 6 million tons of cargo per year, rising to 20 million tons.
In 2017, 27,000 tons of cargo were transported via the INSTC corridor; in 2018, 287,000 tons.The figures for the first two months of this year suggest that the volume of freight will be at least 600,000 tons this year. In other words, the project is gaining momentum and will eventually turn into one of the largest trade routes in the world.
Chabahar port also has great potential. The question is whether it can be realized despite US sanctions.
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