Opinion: With Chabahar India gains upper hand over Pakistan

On December 3, 2017, President of Iran Hassan Rouhani inaugurated the much-awaited Chabahar port. The inauguration follows the successful operationalisation of the port on October 29; which marked a major shift as to how Afghanistan trades with the world and vice versa.

India dispatched first of the six consignments of wheat (India’s commitment to send 1.1 million tonnes of wheat) to Afghanistan via Chabahar, Iran bypassing Pakistan. Traditionally, Afghanistan due to its landlocked nature has been dependent upon Pakistan to receive international aid and conduct trade. With the opening of the route via Iran, Afghanistan's dependence on Pakistan will reduce significantly and it will get access to the seaport, increasing trade volume considerably.

The Chabahar, which is in Iran, is connected to Afghanistan via 635 km road connecting Chabahar to Zahedan and improved the 206 km to Zaranj on its side of the Iran-Afghan border. India as part of its Afghanistan development assistance initiative has constructed 218 km long Zaranj-Delaram highway in western Afghanistan that runs to the Iran border, thus providing much-required sea access.

Add WION as a Preferred Source

The passage of India's first consignment of wheat through Iran's Chabahar port to Afghanistan recently is significant for several reasons. First, it helps in boosting trade ties between Afghanistan and India which have suffered due to transit issues for Indian goods via Pakistan. Afghanistan has the potential to become a major transit hub for Central Asian goods reaching South Asia and beyond via this port facility. The port access is also expected to encourage domestic trading communities in Afghanistan to utilise this facility.

Second, it alters regional geopolitical calibrations i.e. bringing Iran as a player in Afghanistan's reconstruction efforts as well as much needed developmental activity in the Sistan and Baluchistan province of southern Iran.

Third, for Iran, the operationalisation comes at a time when the US has been changing its stance on the nuclear deal. The port is also key to INSTC (International North-South Transport Corridor) which provides trade connectivity from Russia to the Persian Gulf via different trades routes.

India, Iran and Afghanistan may have overcome many challenges to make trade and transit through Chabahar port a reality. But challenges remain. First, the location of the port itself i.e. the port is located just 72km away from the Gwadar port of Pakistan which is part of the multi-billion-dollar China-Pakistan Economic Corridor (CPEC). Second, the US policy with respect to Iran is changing again, the recent decision by the US to decertify Iran as per the Iran Nuclear Deal or JCPOA has renewed fear of economic sanctions on Iran. However, the US Secretary of State Tillerson on his recent visit to India has assured the Indian government that Chabahar port will be out of the purview of any such decision of the US government.

But the impact of the sanctions on the associated economic activity will have an adverse impact on the economic viability of the port. Third, the port would need more than India-Afghan trade to stay afloat. Several countries, including Japan and South Korea, have expressed interest in the port facility and should be roped in. The materialisation of the INSTC will bring much-needed trade traffic to the port facility and provide access to the Central Asian, East European markets for East Asian economic powerhouses.

In addition, the poor security situation in the Sistan-Baluchistan province where Chabahar is located may raise some concerns as the province has the restive Sunni population in Shia-dominated Iran. The deteriorating security situation in Afghanistan, too, could undermine the region's capacity to tap Chabahar's full potential.

(Disclaimer: The author writes here in a personal capacity).