NEW DELHI: India and Iran are close to striking a long-term agreement for operations at the strategic Chabahar Port, with the matter held up only by differences on a clause related to arbitration, people familiar with the matter said.
The long-term agreement, valid for a period of 10 years and to be extended automatically, is meant to replace an initial pact which covered India’s operations at Shahid Beheshti terminal in Chabahar Port and has been renewed on an annual basis.
The move comes at a time when China has been showing growing interest in investments in ports and other coastal infrastructure in Iran, and the Iranian side has been pressing New Delhi to step up development of Shahid Beheshti terminal, which is operated by state-run India Ports Global Limited (IPGL).
The long-term agreement figured in discussions during Shipping Minister Sarbananda Sonowal’s visit to Iran last month, especially his meeting with Iran’s Urban Development Minister Rostam Ghasemi.
The issue holding up the long-term agreement is not major and relates only to jurisdiction for arbitration of differences on any matters, the people said. Under Iran’s Constitution, such arbitration cannot be referred to foreign courts, and a proposal under the agreement would require a constitutional amendment, which would be difficult, they pointed out.
Both sides, however, are hopeful of the speedy resolution of this matter as legal and technical experts are working on it, the people said.
At the same time, the Iranian side has been pushing India to speed up development of its operations at Chabahar port, including the completion of the 700-km Chabahar-Zahedan railway line.
During Sonowal’s visit, the two countries decided to form a joint technical committee for the smooth functioning of the port. India remains “fully committed to develop the Chabahar port to realise the vision” outlined during Prime Minister Narendra Modi’s visit to Iran in 2016, Sonowal said at the time.
India is set to organise a meeting of a joint working group on Chabahar with Central Asian states in October to promote the use of the port, the people said. Steps are also being taken to integrate the port with the International North-South Transport Corridor (INSTC).
