Brahma Chellaney, The Hindustan Times, April 26, 2018
Exaggerated media accounts have sought to portray commercial glitches in India’s Chabahar port project, such as attracting a private partner for the operation of marine facilities there and resolving an excise-duties dispute, as emblematic of India’s eroding influence in southern Asia. Some have seized on the Iranian foreign minister’s statement in Islamabad that Chinese and Pakistani investment in Chabahar was welcome as evidence of India’s declining strategic reach. That statement was largely an attempt to dispel a perception that Iran has teamed up with India to checkmate China’s Gwadar designs.
To be sure, India’s regional clout has suffered — from Sri Lanka and the Maldives to Nepal. The main driver of New Delhi’s eroding influence is China, which has made deep inroads in India’s backyard. By incrementally encroaching on the Bhutan-claimed Doklam Plateau, China has also shown that India cannot guarantee Bhutan’s territorial integrity.
In this dismal picture, however, Chabahar represents a strategic advance, not setback, for India. The Chabahar project’s substantial progress allows India to bypass Pakistan to reach markets in Afghanistan and Central Asia. In the past six months, consignments of wheat, for example, have been passing from India to Afghanistan through Chabahar. In effect, Chabahar helps break Pakistan’s barrier to Indian exports to landlocked Afghanistan.
The hyperbole in India notwithstanding, Chabahar is not a strategic counterpoise to the Chinese-built and -run Gwadar port, adjacent to which Beijing is reportedly building a naval base. Gwadar port offers China joint naval patrols with Pakistan in the Indian Ocean, while Gwadar airport will provide Beijing an airlift capability to link up with its military base in Djibouti. By contrast, Chabahar, located barely 72 kilometers from Gwadar, is a purely commercial project with no military utility.
Chabahar, easily accessible from India’s western coast, is part of a larger Indian-supported transport corridor. For example, the Indian-built, 193-kilometer road from Delaram, in Afghanistan’s Nimruz province, to Zaranj, on the Iranian border, links up with Iran’s new connecting road from Zaranj down to Chabahar. In addition, India is involved in a Chabahar-Faraj-Bam rail link and in a railway from Chabahar to Zahedan, on the Iran-Afghan border. It is also interested in a Chabahar-Hajigak railway that creates direct access to Afghan mines.
Chabahar’s development has been driven by shared India-Iran objectives, including ending Afghanistan’s dependence on Karachi port and integrating that country with their economies. Chabahar, lying outside the Persian Gulf and thus relatively safe from a hostile blockade, is Iran’s gateway to the Gulf of Oman and the Indian Ocean. Developing Chabahar allows Iran not only to receive larger ships but also to boost its energy and other exports.
It was only after the US-Iran nuclear deal eased decade-long international sanctions on Tehran that Chabahar’s expansion could begin in earnest. In 2016, India signed a $500-million agreement to develop two terminals — a multipurpose cargo terminal and a container terminal — in Chabahar, as part of a trilateral pact with Afghanistan and Iran. Since then, work has progressed considerably. The initial expansion of Chabahar was inaugurated this year, with Iran leasing operational control of the port’s first completed phase to India for 18 months.
Afghanistan is already becoming a major beneficiary of the Chabahar-linked transport corridor. It has shifted the bulk of its cargo traffic away from Karachi to Chabahar and Bandar Abbas. Chabahar is set to turn into a vital trading hub — a sprawling, modern port.
But as the port’s further expansion makes progress, India faces project-completion challenges that extend from the changing geopolitical dynamics to its own proverbial red tape. Cash-strapped Pakistan has no capacity to invest in Chabahar. But if China were to invest there, the commercial and strategic value of Chabahar for India to reach Afghanistan and Central Asia is unlikely to diminish.
Iran is actually seeking to ease its heavy dependence on China that developed during the sanctions period. But Iran finds itself stymied by residual but biting US-led sanctions, as in the financial sector. With Western clearing banks still spurning Tehran, Western firms cannot raise project finance to do business in Iran.
India’s biggest Chabahar-related challenge comes from US President Donald Trump’s policy to squeeze Iran — a message Trump’s then national security adviser, Lt. Gen. H.R. McMaster, brought to New Delhi. India, which paid a heavy price for complying with past US sanctions, needs to reject Trump’s Iran policy with the contempt it deserves. It cannot allow the Chabahar project to be hamstrung by geopolitical factors. As the top US general in Afghanistan, John Nicholson, has acknowledged, “Iranian-Indian-Afghan cooperation over the Chabahar Port presents great economic potential” and a boon for Afghanistan.
Brahma Chellaney is a geostrategist and author.