New Delhi: Indian steel companies will export rails worth USD 150 million to Iran next month as part of a pact between the two countries for developing railway and other infrastructure at strategically important Chabahar port.
"The maiden consignment of rail from India worth USD 150 million would be sent to Iran in July," a top official told PTI after Ambassador of Iran to India Gholamreza Ansari called on Road Transport and Highways Minister Nitin Gadkari today.
The consignment of rails will be shipped by steel companies, the official said, adding that both Gadkari and Ansari deliberated on taking further the historic pact between the nations on the strategic Chabahar Port in southern Iran which will give India access to Afghanistan and Europe bypassing Pakistan.
The pact to develop the Chabahar port and other infrastructure was inked last month during Prime Minister Narendra Modi's visit to Persian Gulf nation.
Gadkari last month said that India would invest billions of dollars in setting up industries -- ranging from aluminium smelter to urea plants -- in Iran's Chabahar free trade zone.
Also, railway PSU IRCON will build a rail line at Chabahar to move goods right up to Afghanistan. The rail links are being built so that the land-locked Afghanistan can get access to the Iranian port as an alternative to the Pakistani port of Karachi.
The official said that a meeting is also "scheduled next month between Shipping Minister and his Iranian counterpart to develop a workplan for industrial needs and investments needed for Chabahar free trade zone". The focus will be setting up industries in the Chabahar free trade zone.
Besides the bilateral pact to develop the Chabahar port for which India will invest USD 500 million, a trilateral agreement on transport and transit corridor has also been signed by India, Afghanistan and Iran, which the Prime Minister said could "alter the course of the history of the region". Also, Gadkari has been stressing that the distance between Kandla and the Chabahar port is less than the distance between New Delhi and Mumbai and the pact would enable India quick movement of goods first to Iran and then onwards to Afghanistan and Russia through a new rail and road link.
"Over Rs 1 lakh crore investment can happen in Chabahar free trade zone," he had said.
Earlier this week Gadkari had said that India would be able to save Rs 45,000 crore per annum on urea if it sets up a plant at Chabahar in Iran, negotiations for which are on to get gas on lower price adding that Iran has cheap natural gas and talks are on to get gas at less than USD 2 per mmBtu.
India Ports Global Pvt, a joint venture of the Jawaharlal Nehru Port Trust and the Kandla Port Trust, will invest USD 85 million in developing two container berths with a length of 640 metres and three multi cargo berths.
The Indian joint venture company will invest more than USD 85.2 million in development of the port. India's Exim Bank will provide a credit line of another USD 150 million.
Chabahar port, located in the Sistan-Baluchistan Province on Iran's southern coast, is of great strategic utility for India. It lies outside the Persian Gulf and is easily accessed from India's western coast.
The port project will be the first overseas venture for an Indian state-owned port. The Jawaharlal Nehru port, India's biggest container port, holds a 60 per cent stake in Indian Ports Global while the Kandla port has the remaining 40 per cent.