Strategically located outside the Strait of Hormuz, Chabahar Port is planned to be the eastern arm of INSTC Corridor, connecting to the CIS countries with significant savings in cost and time of shipping.
Tell us about the role of India Ports Global in the development and operations of Chabahar Port?
Now the port development company is a PSU under the Ministry of Shipping and virtue that Sagarmala Company is holding my shares, I become a subsidiary of Sagarmala Company and I also become a small PSU.
Chabahar city has got 2 ports – Shahid Beheshti Port and Shahid Kalantari Port. Shahid Kalantari Port is an old port having a draft of 7-8mts inviting mostly passenger vessels and small container feeder vessels. Shahid Beheshti Port has big development plans running into 4 phases. In December 2017, phase I of Chabahar Port was inaugurated.
Chabahar Port with its strategic location outside Hormuz Strait and being the only oceanic port of Iran with a draft of 16mts has always been attractive to Indian trade. India signed a MoU with Iran in May 2015 and we have taken over the operations of Shahid Beheshti Port from December 2018. For development of the port India is ready to give Iran a credit line of Rs.900 crore. India is also committed to equip the port with equipment worth $85 million. On the operations side, all the marine infrastructure, pilotage, dredging, multi-crafts, etc will be handled by the Iranian side. We will look after the cargo operations and marketing.
Operations at Shahid Beheshti Port have started from December 2018 and till today the port operations have been smooth and incident free. In the next 5years Chabahar will be the third largest port of Iran.
This port is a gateway to West Asia and Central Asia. How can it help Indian trade and what kind of cargoes can move through it?
Chabahar Port is located in the sea of Oman and distance between Mundra or Kandla Ports and Chabahar Port is barely 550 nautical miles (nm). A container ship will take maximum 2 days or even less to travel between the ports. JNPT is at a distance of 780nm, thus offering proximity to west coast of India.
INSTC was established with Bandar Abbas Port in mind – cargo from India could connect to Bandar Abbas Port and further travel north to Caspean sea, connecting to CIS countries. Chabahar is planned to be the eastern arm of INSTC corridor. This connectivity offers 20% saving in logistics cost. We are also focusing on Afghanistan that is dependent on Karachi Port, but is more comfortable to use Chabahar Port. We want to use Chabahar as a gateway to Afghanistan. India has invested in a lot of infrastructure – an internal ring road connecting Iran- Afghan border to which all four major cities of Afghanistan are connected.
What are the land-side infrastructure facilities we have at the port?
We have a water-front of about 1400mts, of which 700mts will have a draft of 16mts and the balance will have a draft of 14mts. The container terminal has a draft of 16mts to accommodate Post Panamax vessels and bulk cape size vessels can berth where the draft is 14mts. We have a backup area of 70 hectares, so there is no issue of space. As far as port equipment is concerned we are having difficulty in getting STS cranes and that is despite America exempting the port, suppliers are still reluctant. Having said that we have new mobile harbour cranes and with the present traffic productivity is no issue. Feeder vessels are arriving and we finish cargo loading/unloading in the quickest way possible.
How is the connectivity to the port?
Presently the port has only road connectivity. Cargo goes to Afghanistan and the border city of Zahedan where borders of all the three countries – Pakistan, Iran and Afghanistan meet. Zahedan is just 616km from Chabahar wherein the distance can be covered by trucks in one and half day. Afghan cargo goes to Milak border and connects to all four major cities of Kabul. Chabahar Port has a free zone where value-addition of cargo takes place. Ground work for rail connectivity to Zahedan has just started and it will take atleast 2 years to be operational.
Tell us about the FTWZ coming up at the port?
Initially the port was outside the free zone, but now lately the port has been included in the free zone, so all the benefits of the free zone are available in the port itself.
What kind of commodities can be exported/imported through this port?
We are handling all types of cargoes and Iran imports lots of grains and home appliances. For handling bulk cargo we have pneumatic unloaders. Earlier Iran had earmarked Bandar Abbas as the container port and Bandar Imam Khoumeni as the bulk port. Livestock vessels are also arriving. Transshipment cargo comes from Jebel Ali. Predominant imports from India are soyabean and rice. Reefer cargo such as dry fruits comes from Afghanistan. at present we are not handling any cargo for CIS countries. we are in discussion with CONCOR as they have requested for discounts/incentives.
It has been reported that Chabahar Port can become a good alternative to Jebel Ali and a lot of dependency can come down on Jebel Ali. Your comments?
It will be too premature to compare Chabahar and Jebel Ali at this stage. But if all the impediments like the sanctions are removed then I would give a timeline of 10-15 years. The development plan is of 4 phases. In pase I, presently, the port capacity is 8 million tonnes per anum. Upon completion of the fourth phase the capacity will increase to 50-60 tonnes per anum.
Did you see any impact of COVID-19 on your operations?
Though Iran was quite severely affected by COVID-19, but there was not much impact on the port operations as we were taking all due precautions.
Any other ports on the radar of IP Global?
It depends on the government. We have examined many projects but for them to materialise is an issue. We have studied Payra Port in Bangladesh, East Coast Terminal in Sri Lanka and Sabang Port in Indonesia, so it has to be neighbourhood and strategic in nature.
Any final comments to Indian stakeholders?
My request to all stakeholders is to promote Chabahar Port and Afghanistan should not be dependent on gwadar/Karachi Port. We are having weekly service with shipping lines, discounts are offered on container handling. 50% discount is being offered to transit cargo.
