Iran drops India from Chabahar Rail Project due to funding delay
- Iran has dropped India from the Chabahar rail project, for the construction of railway line from Chabahar port to Zahedan, along the Iran-Afghanistan border.
- The reason that Iran gave for dropping India was delays from the Indian side in funding and starting the construction of the project.
- Iran has now decided to move ahead with the construction of Chabahar railway line to Zahedan on its own.
- For this $400 million will be sanctioned by the Iranian National Development Fund and the entire project will be completed by March 22, without any assistance from India.
- It must be noted that this decision has been taken by Iran at a time when it is seeking to finalise a 25-year economic and security partnership with China worth $400 billion.
What is Chabahar rail project
- The Chabahar rail project deal was signed in 2016 during Prime Minister Narendra Modi’s visit to Tehran, as a part of India’s commitment to the trilateral agreement with Afghanistan and Iran to build an alternate trade route to Afghanistan and Central Asia.
- It included construction of 628-kilometre railway line from the strategically vital Chabahar port to Zahedan, along the border with Afghanistan.
- Indian Railways Construction Ltd (IRCON) had promised assistance for the project besides financing worth $1.6 billion.
- However, the work could not be started as the United States imposed sanctions on Iran.