International companies have signed agreements with Iranian businesses to invest $3.2 billion in Chabahar, as part of development projects of Makran Coast in southeastern Iran.
“Seven major memorandums of understanding were signed with companies from India, Oman, China and South Korea,” CEO of Chabahar Free Zone Organization, Abdorrahim Kordi, was quoted as saying by ILNA.
Makran is a semi-desert coastal strip stretching along southeastern Iran to Pakistan’s Balochistan and borders the coasts of Persian Gulf and Sea of Oman. It is home to the strategic port of Chabahar, which Iran intends to develop by attracting private and public sector investments.
A $2.1 billion agreement with Mohsin Haider Darwish LLC—an Omani holding active in a variety of fields, including engineering and construction—to build a 150-hectare logistics park in Chabahar accounted for most of the investments.
Kordi said the project was in line with the two major international transit pacts of Chabahar Agreement and Ashgabat Agreement.
The Chabahar Agreement is a trilateral accord among Iran, India and Afghanistan to develop the strategic port of Chabahar to build a transport-and-trade corridor through Afghanistan that could help halve the time and cost of doing business with Central Asia and Europe.
It is part of the International North-South Transport Corridor, a transit route from India to Europe and Central Asia and vice versa, passing through Iran, Azerbaijan and Russia.
Cargo carried by sea to Chabahar will be transported via rail to Afghanistan and Azerbaijan, and from there to destinations further afield.
The Ashgabat pact is a multimodal transport agreement involving Oman, Iran, Turkmenistan, Uzbekistan, Kazakhstan and Pakistan for creating an international transport and transit corridor facilitating the transportation of goods between Central Asia and the Persian Gulf.
The objective of this agreement is to enhance connectivity within the Eurasian region and synchronize it with other transport corridors within that region, including the INSTC.
Another agreement was signed between Chabahar Free Zone Organization and South Korea’s POSCO to develop Chabahar’s infrastructures.
Both sides agreed to “create a multinational consortium to carry out feasibility studies for projects in the fields of metal industries, construction, telecommunications and transportation”, Kordi said.
“Financing the projects, establishment of specialized industrial towns and construction of residential buildings are among the consortium’s plans.”
The Chabahar FTZ’s CEO noted that Iran and India agreed to construct the Iran-India Industrial Town with the aim of empowering Indian industrialists regarding their small- and large-scale investments in southeastern Iran and Chabahar FTZ in particular.
“The idea was proposed following requests of Indian traders and industrialists who were eager to gain access to the regional market as well as Iran’s transit corridors,” Kordi said.
Developing Chabahar Port is seen as crucial for India because it will not only allow New Delhi to bypass Pakistan and access global markets but also help counter China’s expanding influence in the Indian Ocean region. However, the project’s land route through Afghanistan remains a security headache.
Moreover, Chinese companies have agreed to invest in infrastructure projects in Chabahar in the fields of water, steel, oil and gas pipelines, seafood, shipping, construction and tourism.
The agreements were signed on the sidelines of the International Conference on Investment Opportunities in Makran, which was held on January 23-24.
According to Iraj Tajeddin, a spokesman of Makran Investment Organization, the event was aimed at introducing investment opportunities in Makran to domestic and foreign investors.
Makran’s Coast has been earmarked as a prime location for development, as it is ideal for becoming a commercial hub in southern Iran.