Why INSTC was in focus during Jaishankar’s visit to Iran

During External Affairs Minister S Jaishankar’s recent visit to Iran, the International North-South Transport Corridor and the Chabahar port were central issues in the meetings held. ETV Bharat’s Aroonim Bhuyan explains the reasons why.

New Delhi: Among the several meetings that External Affairs Minister S Jaishankar held during his two-day visit to Iran that concluded on Monday, one was with Iranian Minister for Roads and Urban Development Mehrdad Bazrpash.

During the meeting, discussions were held on expediting work on the International North-South Transport Corridor (INSTC) and the Chabahar port in Iran in which India has a substantial stake.

“Detailed and productive discussion on establishing a long-term cooperation framework with respect to Chabahar port,” Jaishankar posted on X after the meeting. “Also exchanged views on the International North-South Transport Corridor.”

Later, addressing a joint press conference with Iranian Foreign Hossein Amir-Abdollahian, Jaishankar said that regional connectivity has been a critical pillar of India-Iran relations, and figured prominently during the discussions.

“I reiterated India’s interest in benefiting from Iran's unique geographical position to access markets in Central Asia, Afghanistan and Eurasia,”. “We discussed the prospects of energising the International North-South Transport Corridor. In particular, we discussed India’s involvement in the development and operation of the Chabahar port, a joint project with a joint vision of connectivity.”

Jaishankar said that he emphasised India’s commitment to the Chabahar project, and “discussed how we can establish a firm, sustainable and long-term roadmap, for India's continued involvement over the coming years”.

“Given the importance of this project for both nations, I emphasised the need to monitor its progress under the direct supervision of the political leadership,” he added.

According to state-run IRNA news agency, Jaishankar and Bazrlash have reached a final agreement to develop the Chabahar port in southeastern Iran.

“Proposing the formation of a joint transportation committee to expand cooperation between the two countries, Bazrpash said that the formation of this working committee will enable the activation of transit capacities and the use of the North-South corridor,” the IRNA report stated. “The Indian foreign minister, for his part, expressed his country’s readiness for fresh investments in the fields of transportation and transit in Iran.”

During the meeting between Jaishankar and Foreign Minister Amir-Abdollahian, the discussion focused on the long-term framework for India’s involvement with the strategically vital Chabahar port and the INSTC connectivity project.

The long-term framework is expected to replace the original contract which only covers India's operations in the Shahid Beheshti terminal in the Chabahar port and is renewed every year. The new long-term framework will be valid for 10 years and will be automatically extended.

The INSTC is a 7,200-km-long multi-mode network of ship, rail, and road routes for moving freight. India, Iran, and Russia had in September 2000 signed the INSTC agreement to build a corridor to provide the shortest multi-model transportation route linking the Indian Ocean and the Persian Gulf to the Caspian Sea via Iran and St Petersburg. From St Petersburg, North Europe is within easy reach via Russia.

The estimated capacity of the corridor is 20-30 million tonnes of goods per year. The route primarily involves moving freight from India, Iran, Azerbaijan, and Russia via ship, rail, and road. The objective of the corridor is to increase trade connectivity between major cities such as Mumbai, Moscow, Tehran, Baku, Bandar Abbas, Astrakhan and Bandar Anzali.

So, why has the INSTC come into focus?

One reason is that work on the India-Middle East-Europe Economic Corridor (IMEC) that was proposed during the 2023 G20 Summit held in New Delhi is getting delayed because of the Israel-Hamas war that broke out in October last year.

The IMEC is a planned economic corridor that aims to bolster economic development by fostering connectivity and economic integration between Asia, the Persian Gulf and Europe. The IMEC comprises an Eastern Corridor connecting India to the Gulf region and a Northern Corridor connecting the Gulf region to Europe.

It will include a railway and ship-rail transit network and road transport routes. On September 10, the Memorandum of Understanding (MoU) was unveiled during the 2023 G20 New Delhi Summit by the governments of India, the US, the United Arab Emirates (UAE), Saudi Arabia, France, Germany, Italy, and the EU.

According to Abhinav Pandya, founder, director and CEO of the Usanas Foundation think tank, the progress of work on the IMEC is facing significant problems because of the Israel-Hamas war.

“For India, the INSTC is a safe zone as it passes through friendly countries,” Pandya told ETV Bharat. “India gets access to the European markets via Armenia and Georgia.”

Armenia! According to Pandya, India looks at Armenia as a nodal point to expand its strategic and economic outreach to the South Caucasus. New Delhi’s most critical interests in this region lie in the strategic connectivity projects.

“India’s interest in the INSTC (International North-South Corridor), of which Armenia is a part, is firmly rooted in its quest for land connectivity to Eurasia, Central Asia, and Europe through the Iranian plateau, otherwise blocked by Pakistan and Afghanistan,” says Pandya.

“With this intent, India aims to extend INSTC to Armenia, connecting Chabahar port in southeast Iran to European and Eurasian markets. India and Iran have two options - railway lines connecting North Western Iran to Russia or the Black Sea through Armenia’s Syunik province or via the Caspian Coast through Azerbaijan.

Armenia is a natural choice for India because of Azerbaijan’s proximity to Pakistan and Turkey. Armenia is also keenly interested in INSTC. Yerevan announced an alternate road to Iran in May 2021 to connect Iranian ports to Georgian ports via Armenia.”

Pandya said that during Jaishankar’s visit to Yerevan in 2021, Armenia also proposed a scheme allowing the transportation of Indian products to Russia and the Black Sea via Armenia.

“All these initiatives bring the INSTC closer to reality,” he said.

So, what is the current status of the development of the INSTC?

In April 2017, a trial run of container transportation through the green corridor was executed to assess and ensure seamless customs facilitation, establishing a connection between India and Russia, as well as Europe, through Iran. On July 7, 2022, RZD Logistics, a Russian company, declared the successful completion of its inaugural shipment to India via the INSTC, a milestone verified by Iranian and Indian trade entities.

With India and Iran now agreeing to a long-term framework on the INSTC and the Chabahar port, cooperation between New Delhi and Tehran on connectivity issues is now expected to get a fresh boost.

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