Cabinet approves credit of 150 Million USD to Islamic Republic of Iran for Chabahar Port Development
NEW DELHI : The Union Cabinet chaired by the Prime Minister Shri Narendra Modi has given its approval to the proposal of the Ministry of Shipping for provision and operationalization of credit of 150 million USD from Export-Import Bank of India for development of Chabahar Port in Iran. Chabahar Port lies outside the Persian Gulf in Iran and will help in expanding maritime commerce in the region.
India is negotiating this project to facilitate the growing trade and investment with Iran and other countries in the region, notably Afghanistan and also to provide opportunities to Indian companies to penetrate and enhance their footprint in the region.
An MoU was signed between India and Iran on May 6, 2015 by Shri Nitin Gadkari. Minister of Shipping, Road Transport & Highways and his Iranian counterpart. As per the MoU, India is to equip and operate two berths in Chabahar Port Phase-I with capital investment of USD 85.21 million and annual revenue expenditure of USD 22.95 million on a ten year lease. Ownership of equipment will be transferred to Iranian side on completion of 10 year period or for an extended period, based on mutual agreement. The Iranian side had requested for provision of a credit of USD 150 million in accordance with the MoU. As per the MoU, operation of two berths will commence within a period of maximum 18 months after the signing of the Contract.
The two berths will be operated by the India Ports Global Private Limited, a Company promoted by the Jawaharlal Nehru Port Trust and Kandla Port Trust - two Major Ports working under the Ministry of Shipping.
The Union Cabinet has now authorized the Ministers of Finance, External Affairs and Shipping to approve the final contract with Iran and for resolution of any issue arising in implementation of the project.
The Union Cabinet has also authorized the Ministry of Shipping to form a Company in Iran for implementing the Chabahar Port Development Project and related activities.