After much dilly dallying, India has started special allocation for development of Chabahar port in Iran in its annual budget. Indian government has allocated $22.5 million for the development of Chabahar port in financial year starting from April this year.

India had received contract to develop a multipurpose cargo terminal (600 meters length) and a container terminal (640 meters length) at Chabahar port last year in May. Indian government had agreed to equip both the terminals with equipment worth $85 million. Last year, Indian government had allocated $15 million for the said project. Indian has also planned major event at Chabahar port in April this year whereas it will showcase the opportunities for private players. India had pledged $500 million investment in the project mostly from Indian private companies having business interest in Iran.

India's EXIM bank has also promised $150 million credit for the development of phase 1 of the port, within 4 months of receiving their application through Central Bank of Iran. Government sources told Sputnik that it was awaiting the submission of projects from Iranian side.

Gwadar will provide India an access to Eastern transit corridor to eastern part of Iran, landlocked Afghanistan and CIS countries like Turkmenistan, Uzbekistan etc. Under the port deal, India will also build rail road in Afghanistan aiming for Afghanistan's iron reserves, which are estimated to be worth up to $3 trillion. Chabahar project is also considered as alternative to North South Corridor i.e. access to Russia and North Baltic countries.

Chabahar is considered as an India's answers to China's One Belt One Road policy under which it is developing Gwadar port in Pakistan; just few miles away from Chabahar.

(Source: Sputnik)