Iran's Chabahar Port: Boosting Indian Exports Analyzed by Former Indian Envoys | CNBC TV18

[Music] hello and welcome to Global ey I'm parikhit lutra day after India signed a 10-year deal to operate the chabahar port in Iran the US has threatened that any entity considering business deals with Iran will need to be aware of the potential risks of sanctions reacting to the statement foreign minister SJ Shanker said that this deal will benefit the entire region and people should not take a narrow view of the initiative so why is this port so important for India and what impact will it have on its straight ties with Iran now let us pull up the map on the screens telling you the significance of the chabahar port so if that is Gujarat this is Iran and this becomes the closest Iranian port to India and what else does this do this actually helps India to avoid Pakistan altogether this is the guad port in Pakistan it allows India to avoid Pakistan route completely take a route through chabahar in Iran and this gives us a route to Afghanistan as well since covid-19 we have been utilizing this route for transporting medicines fertilizers uh food grains as well so it is extremely crucial for India to renew this 10-year agreement with the Iran on the chabahar port they've also set up an arbitration tribunal in musket any kind of issues arising in terms of arbitration will go there uh they've also India has also announced a line of credit of $250 million to develop the sport further there will be an Indian company which will work on upgrading the sport and operating it as well so extremely crucial development there but it's also attracting scrutiny from the United States let's discuss this and much more with our guests in the evening we've got Ambassador Casey Singh former Indian ambassador to Iran and also former Indian ambassador to the WTO J Das kupta uh Ambassador Casey saying let me Begin by asking you the significance of signing this agreement right now we were in the middle of the elections we still sent a union Minister for shipping and waterways all the way to Iran to sign this agreement uh do you think the timing is significant no I don't know I think timing depends not just on India it depends on Iran uh so it has to be mutual convenience uh but it's any agreement with Iran is not always a simple and straightforward uh uh proposal because the Iranians always have multiple games that they play uh which involves uh their proximity to China and Russia their problems with us the Gaza War where is seen as confronting Israel so when you get into a deal with Israel getting drawn into a geopolitical game uh in which you are sucked in then the other thing is what is the port going to be used for no we've been discussing it this is nothing new we've been discussing it since the time I was Ambassador there 2003 to 2005 the National Security advisor came to India and I remember part of the briefing when I was telling Mr bajes Mishra NSA I said we have to be very clear about what is on the table because we don't want to spend money there and then realize that we are not getting because Port by itself is not enough you need a contiguous area you need a place where you can store things so even if you're feeding things say into Central Asia Afghanistan you you can't be just dependent dependent on somebody else's storage you need a huge amount of we withal with the port to be able to optimally use it the Arians the problem normally is they will not give you control over anything and certainly not control control over land so in the process you'll always be dependent on various Iranian entities very bureaucratic difficult to deal with and then they will always mix politics with religion uh politics with business so where business comes in they'll also see how is it helping them and then the Chinese are very much in play they will play the Chinese against us don't forget the Chinese have a long-term agreement of almost 300400 billion dollar which they have promised to invest in Iran over the next uh two or decades and the Chinese are interested in goad which is just 200 kilometers from chabahar so they will pretend to be interested in developing chabahar but they will also be keeping an eye on how it impacts guad because guad in Pakistan is the end point of cek the China Pakistan economic Corridor and that is also feeding Afghanistan and Central Asia so we trying to bypass it the Chinese would be keeping a very close eye on this and the Iranians have a tendency to play one country against the other and what the chin is bring on the table India can't compete with uh they have a much bigger trade relationship they can buy much more oil they're less concerned about sanctions so you know it's not an easy game that we stepping into and they can they can definitely put much more money on the table let me get in Ambassador Das Gupta as well Ambassador Das Gupta if we SP speak about certain points that were raised by Ambassador Casey Singh in terms of uh the chabahar port lacking the required infrastructure do you think this new deal covers and addresses those aspects the new Investments being made by the Indian government through the port company ipg the Investments that will be made by the Iranian side do you think that takes care and addresses those questions I entirely agree with Ambassador Singh that uh this is uh just the uh starting of a long journey and we have to see there would be many obstacles uh including you know us sanctions and theity of money from coming from the Iranian side and then the very important point which Ambassador Singh has mentioned about the Chinese uh promising 300 to 400 billion dollar over the next decade or two decades and uh they would try to sty the development of the Indian uh part of the project in chabahar as it is the Chinese are already there in the chabahar special economic zone and they have a deep abiding interest in ensuring that India does not gain much of a foothold there in chabahar now having said that the issue about chabahar is of course opening up the taram Karan route to Western Afghanistan from chabahar that is one point the second point is that there is a small place called sarak which Ambassador dinkar shav has mentioned he was also Ambassador I think succeeded Ambassador Singh uh in Iran and that sarak is in the northeastern corner of Iran it is in the at the tri Junction of Iran Afghanistan and Turkmenistan and it is connected by rail to Turkmenistan and turkistan is again connected to many of the Central Asian republics by rail so the missing Gap is between chabahar and sarak if that Railway line could be constructed despite all the obstacles that I have mentioned and then there could be a smooth flow of traffic that is one option the second option is as matters stand today the Iranians perhaps want to make it a part of the international north south TR Transit Corridor which they have entered into with Russia so that involves transporting the goods to B Abbas and from there bere aali on the Caspian Sea and then it crosses the Caspian Sea into asan which is on the southern border of Russia and from there there is a Rail Link going all the way to St Petersburg okay so ambas Casey Singh how do you think we can make sure that we utilize this route more effectively and diplomatically make sure there are no hurdles between India and Iran in terms of utilization of this sport you've yourselves said that uh Iran would like to play China against India how do we avoid such a situation uh let me first explain uh what ambass s Gupta is saying that the north south Corridor I was in tan when that had become operational we ran into a number of problems one was the Iranians were they hiked up the charges when you take a container off in Babas and then also the charges for transporting it to the Caspian again very high charges for putting it on a ship then the container would go to Russia and the Russian Mobsters would take over and they would extract the money and then the most difficult problem was that there is imbalance of trade now you can't be sending containers up into Russia with very few things to come back all you need is oil and gas from Russia now therefore the containers would get stuck in Russia now if the containers get stuck there how you going to keep sending fresh containers now till you address this basic problem of imbalance of trade and that has got worse after the Ukraine war because now even there will be hurdles between Russia and Europe as far as moving products is concerned particularly once the Americans see that the Russians are going to benefit from this uh they would put all kinds of hurdles in combination with the EU on those products moving on into the uh into the European sector therefore it's not that simple the Russians and the other one they're trying is no we will go through aeran Georgia and all Overland the minute you have multiple countries the geopolitics comes in there's instability in one part they may not even be the same width of the Railway line you would require some trans shipment so these are all good in theory but till they are fully tested I think Chinese have tried a rail Railway line all the way to Europe which is the East West line and apparently the justification for us going ahead with the Iranians and what we tell the Americans would tell the Americans is we are countering the belt and Road initiative of the Chinese now to what extent that works we don't know because the Chinese are going on a different route which is more East and West uh so now although one thing is they when Americans say you see last time we got an exemption from the Americans for chabahar because we argued we are only sending humanitarian assistance to Afghanistan then of course subsequently Afghanistan moved under the control of Taliban thanks to the Americans walking out now the Americans don't have the same interest in Afghanistan that they had earlier so we don't know what their game is so we will know what the game is but probably the one saving feature might be that we have a standalone company so if they want to sanction a company let them sanction the company which is there uh it may not impinge the rest of India's shipping links with the world right very important points there Ambassador Casey Singh and I just want to press on the US point a little more uh the US ambassador in an interview recently said there might be a clarification of the United States as far as the status of chabahar goes but the state department was very clear that there is no exemption for Iran no exemption for chabahar at this juncture so do you feel that if India invests in the chabahar port extend extends any kind of money or or operates this port in any way uh there would be sanctions Ambassador Gupta or do you think the US would wait and watch well in 2017 Ambassador Singh is absolutely right in 2017 president Trump was there and we got a special exemption for chabahar to be used as a gate way to supply through Western Afghanistan because uh favorable government was in power in Afghanistan in those days things have changed but there is growing influence of China in Afghanistan and India being a strategic partner of the US has to explain that India's presence in Central Asia as well as in Afghanistan is going to be ultimately strengthening this strategic partnership so uh the state department has issued the same kind of um hard message when President Ibrahim RI visited Pakistan of Iran visited Pakistan last month and it is they have just repeated the same thing but we have to talk to the Americans and explain that this has got nothing to do with Iran's um stance on Hamas on the huis on the other Hezbollah militias and it's continuing animosity the fight with Israel this has got to do with trade and it is not really confined to Iran it is looking Beyond Iran towards Afghanistan and the other Central Asian republics and it is going to countervail in a small way perhaps at the moment because we are not going to invest as much as the Chinese have promised so it is going to counter Veil the Chinese influence in these areas all right we've completed run out time but i' I'd like to thank Ambassador Das Gupta and Ambassador Casey Singh for joining us on the program that's been a important interesting discussion on the chabahar port so clearly there are a lot of hurdles on the way and the China angle that we'll also have to be very careful about we're heading into a short break but coming up Russian President Putin was on a two-day State visit to China Putin and Shi Jinping have expressed alignment on many issues and are looking to deepen their partnership a discussion with former Indian ambassador to Russia DB venkatesh VMA when we return [Music]

Channel: CNBC-TV18

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Id: W8fQ4MiJ698

Length: 14min 43sec (883 seconds)

Published: Fri May 17 2024