The Indian government agreed to let the nation's companies upgrade facilities at a port in Iran, despite U.S. warnings not to rush into investments in the country before a nuclear deal is completed.
Indian Shipping Minister Nitin Gadkari signed an agreement with Iranian Transport Minister Abbas Ahmad Akhoundi that will allow Indian companies to negotiate a commercial contract to lease two berths at the port. The companies will ensure that the berths can be used as container and multipurpose cargo terminals, India's Ministry of External Affairs said in a statement late Wednesday in New Delhi.
India has been seeking access to Chabahar since at least 2006 as a gateway to resource-rich but landlocked Central Asian nations that would circumvent its nuclear-armed rival Pakistan. Those plans stalled in part due to U.S.-led sanctions forbidding business with Iran that were imposed to try to halt Tehran's nuclear program.
India has been seeking access to Chabahar since at least 2006 as a gateway to resource-rich but landlocked Central Asian nations that would circumvent its nuclear-armed rival Pakistan. Those plans stalled in part due to U.S.-led sanctions forbidding business with Iran that were imposed to try to halt Tehran's nuclear program.
In particular, the development of the terminals in Chabahar would provide Afghanistan with an alternative to its existing route to the sea through Pakistan.
"For India, it assumes urgency now," said Neelam Deo, a former Indian diplomat and director of Mumbai-based Gateway House. "India already has some $2 billion worth of investment in Afghanistan. Yet it hasn't actually been able to get any fossil fuels out of Central Asia. It wants to get access before the region gets completely locked down by China," she said.
India's state-run Jawaharlal Nehru Port Trust and Kandla Port Trust plan to form a joint venture that will invest $85 million to upgrade the two berths within 12 months, according to an Indian cabinet decision last October. The venture may also seek a local Iranian partner and an Indian private partner, the government said in an Oct. 18 statement.
With a comprehensive nuclear deal between Iran and world powers being sought by the end of June, Under Secretary for Political Affairs Wendy Sherman, the lead U.S. negotiator, warned last week against rushing in to do business with Iran.
"Hold your horses," Sherman told reporters in New Delhi on April 29. "It's not a done deal." It would take time even after an agreement to unwind sanctions, she said.
A U.S. sanctions law enacted in 2012, with the Chabahar port project in mind, lets the president "provide for an exception from the imposition of sanctions" for "reconstruction assistance or economic development for Afghanistan."
...
"I was very sympathetic to the Indian government's arguments about providing development aid to Afghanistan when this exception was first provided," said Mark Dubowitz of the Foundation for Defense of Democracies in Washington, who's advised Congress and the Obama administration on how to expand U.S. sanctions on Iran.
"But Delhi is really jumping the gun here and revealing how difficult it will be for the Obama administration to use 'snap back' sanctions to enforce an Iran deal once countries, especially close U.S. allies, commit to large investments in Iran," he said.
...
Read the full article here.