Union Cabinet approves $150 million Credit for Chabahar Port Development
The Union Cabinet has approved 150 million dollars credit for Development of the strategically important Chabahar Port in Iran.
In this regard, the Union Ministry of Shipping had forwarded the proposal for provision and operationalization of credit from EXIM Bank.
Union Cabinet also has authorized
- Union Ministers of Finance, Shipping and External Affairs to approve the final contract with Iran and for resolution of any issue arising in implementation of the project.
- Union Ministry of Shipping to form a Company in Iran for implementing the Chabahar Port Development Project and related activities.
Background
- In 2003, India and Tehran had agreed to develop Chabahar Port located in the Gulf of Oman
near Iran’s border with Pakistan. - However the venture was delayed because of the sanctions imposed over Iran’s atomic programme.
- But in May 2015, prior to lifting of the sanctions both countries had singed Memorandum of Understanding (MoU) to fasten the development process.
Significance
- Chabahar Port will help India to expand maritime commerce in the region and enhance footprint of Indian companies in the region.
- It will also facilitate growth in India’s trade and investment with Iran and other countries in the region.
- India will get sea-land access route to Afghanistan bypassing Pakistan in turn opening opportunities for Indian companies to explore Afghanistan’s mineral wealth.
- It will also enhance Afghanistan’s overall connectivity to regional and global markets significantly giving fillip to its on-going reconstruction and humanitarian efforts.
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Month: Current Affairs - February, 2016