Chabahar port

WEB DESK: Indian Prime Minister Narendra Modi, Afghan President Ashraf Ghani and Iranian President Hasan Rouhani met last Monday in Tehran to sign an agreement to kick-start the development of Chabahar port with the construction of two berths at a cost of $85 million over the course of 18 months.

India is to make available a $500 million credit line extended by the Exim Bank of China for the first phase of construction at the port. India has also offered to supply $400 million worth of steel towards the construction of a rail link between Chabahar and Zahedan as a part of North-South Transport Corridor.

On this occasion, an MoU was also inked between India’s state-owned National Aluminum Company and Iran’s state owned IMIDRO to work on setting up a $2 billion aluminum smelting facility in Chabahar. An MoU was also signed for financing of the Chabahar-Zahedan railway link supported by Indian Railway’s public sector unit Ircon International. The Indian side stated that the Indian companies see an investment potential of $15 billion in Chabahar Special Economic Zone in the areas of gas and urea plants and other industries.

All these industries are fuel extensive and their feasibility is contingent upon Iran supplying low-cost natural gas to India. Iran and Afghanistan are the logical stake holders in the development of Chabahar port and rail links and all of them have their commercial and strategic interests tied up in the project. For India, the most feasible and reliable access to Afghanistan, Iran and Central Asia is the land route via Pakistan, but it sees this as a remote possibility happening in the near future on account of unresolved political issues between the two countries. India wants to move into the Central Asian markets while Iran needs investments and technology to catch up after moving out of decades of global isolation.

Afghanistan, a land-locked country, considers this as an access to an alternate port as against the only available via Pakistan. It has become obvious that India is seriously concerned with the establishment of the China Pakistan Economic Corridor (CPEC) and views this as a grave threat to its economic and strategic goals and influence in the Central Asia region and to its internal security as well.

Some analysts view the May 2016 agreement on Chabahar between India, Iran and Afghanistan as a counter to the CPEC. There appears to be some truth in it. India has by now understood that the CPEC is there to stay and will move on irrespective of its resistance. India seeks to slow down the CPEC and move fast with its access to Central Asia, bypassing Pakistan-China with a view to having a lead in positioning itself in the region.

India seems to be working hard towards both objectives; hence the urgency to speed up work at Chabahar port, the project on which it has been slow paddling since the 1990s and spent $100 million during 2005-09 on the construction of a roadway to achieve connectivity between port and northern Afghanistan. Chabahar port poses no competition to Gwadar port nor to CPEC; nor is it by any dimension comparable to the two. Gwadar port is situated on the eastern bay of a natural hammerhead-shaped peninsula protruding into the Arabian Sea, at the most strategic mouth of the Persian Gulf and a gate to the Strait of Hormuz which is the key shipping routes in and out of the Persian Gulf and a home to a two-thirds of the world’s oil reserves. On the other side, there is a clear vision to much of the coastline of India.

Gwadar is also the nearest warm water seaport to the land-locked but energy-rich Central Asian Republics and also Afghanistan. The CPEC in turn is a much ambitious initiative known as ‘One Belt one Road’ which envisages new land and sea routes with connectivity from China to Western EuroAsia and East Africa. All Central Asian states and Russia have shown keen interest to be part of the CPEC.

They see much value-addition to be part of it as the best logistic option to reach warm waters at one end and China at the other end. All of these states are keen to position much of their economic and strategic interests in favour of China which is coming up as a leading global economic and political power with no political strings attached. India seems to be lost and un-nerved.

Its investments and alignments in favour of going for Chabahar are more of a domestic and external face-saving in the face of the CPEC and less of economic or strategic value. Considering the logistics from the capital of India to the capital of Afghanistan as the end destination, the driving distance from Delhi to the port at Mumbai is 1429km involving 22 hours and 20 minutes of non-stop travel time. The distance from port at Mumbai to port at Chabahar is 936 nautical miles involving a travel time of 4 days at sea. The distance from Chabahar port to Kabul is 1840km involving 28 hours of travel time.

So the goods moving out of Delhi to Kabul involve a distance of 3,269km on surface and 936 nautical miles on sea involving a total travel time of non-stop 8 days whereas a realistic time could be over two weeks considering three stages of goods loading and three stages of unloading. Insofar as the distance from Delhi to Kabul via Pakistan is concerned, it is only 1297km involving a non-stop travel time of 16 hours and 40 minutes with one loading stage at Delhi and another at Kabul.

This route is the most feasible choice for India. Also for Afghanistan, Gwadar is the most economical choice as the distance from Gwadar to Kabul is 1237km as against 1840km from Chabahar. It is quite unfortunate that our region is still held hostage by the past riddled with false egos, trapped mindset, lack of vision and will to improve the lives of the people. – Business Recorder

(The writer is former President, Overseas Investors Chamber of Commerce and Industry)