DUBAI: Iran inaugurated a long-awaited $1 billion project to expand its southeastern Chabahar port which Tehran hopes would help the country become a key transit route to Afghanistan and Central Asia, competing with Gwadar port.

President Hassan Rouhani inaugurated the expansion, carried out with an investment of $1 billion, including $235 million from India. The project has more than tripled the port’s capacity to 8.5 million tonnes a year.

India has committed $500m to the Gulf of Oman port, which is Iran’s closest to the Indian Ocean and would allow it to bypass Pakistan. But New Delhi has proceeded cautiously at a time when Washington has taken an aggressive approach towards Tehran.

In October, India sent its first consignment of wheat to Afghanistan through Chabahar, about 140km from Gwadar.

The project was executed by a Revolutionary Guard-affiliated company, Khatam al Anbia, the largest Iranian contractor of government construction projects. It involved several subcontractors, including a state-run Indian company.

The expansion includes five new piers, two of them for containers allowing cargo vessels with up to 100,000-tonne captaincy to dock.

President Rouhani, however, downplayed suggestions of rivalry with Pakistan’s Gwadar port in his inauguration speech and said the port would bring “more engagement and unity” among countries of the region.

“We should go after positive competition,” he said. “We welcome other ports in the region, we welcome Gwadar’s development.”

He said Iran also planned to link the port to the country’s railroad network to facilitate transit of goods to neighbouring landlocked Central Asian countries, as well as open a route to eastern and northern Europe through Russia.

Iranian state TV said the inauguration was attended by dignitaries from India, Qatar, Pakistan and Afghanistan.

The Minister for Maritime Affairs, Senator Mir Hasil Khan Bizenjo, represented Pakistan at the ceremony.

Chabahar also has an international airport and Iran’s navy and air force have bases in the city, adding to the port’s value.

“Through this port, goods will be delivered to neighbouring countries at cheaper prices and in a shorter time,” President Rouhani said.

The project was conceived in 2003. The port can accommodate giant ships up to a dry weight of 120,000 tonnes, with further stages of development due to expand the port over the next 14 years.

“Chabahar will soon become an important commercial hub for Iran,” Transport Minister Abbas Akhoundi said at the ceremony.

Iran has a broader vision of linking the Indian Ocean port with a railway through Zahedan, on the Pakistan border, up to Mashhad in the northeast.

But the project, aimed at facilitating trade with Afghanistan and Central Asia, has been slow to get off the ground.

Mr Rouhani underlined the importance of Chabahar as Iran’s only port outside the Gulf, and therefore outside an area that is often the locus of tensions with the US navy and Iran’s regional rivals.

Published in Dawn, December 4th, 2017