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Russia, India & Iran want to create alternative trade route to Suez Canal – report
Nov 022018Officials from India, Iran, and Russia are going to meet next month to negotiate a large joint project aimed at launching a new cargo transport corridor that could become a cheaper and shorter alternative to the Suez Canal.
The new shipment passage, North-South Transport Corridor (INSTC), is set to connect the Indian Ocean with the Persian Gulf through Iran to Russia and Europe, according to Iranian state-owned news outlet Press TV. The 7,200-kilometers long corridor will combine sea and rail routes.
“The INSTC is the shortest multimodal transportation route linking the Indian Ocean and Persian Gulf via Iran to Russia and North Europe,” India’s Ministry of Commerce and Industry said in a statement, adding that trilateral talks between the parties are scheduled on November 23.
Currently, Indian logistics companies have to route shipments through China, Europe or Iran to get an access to Central Asian markets. The former two ways are reportedly long, time-consuming and inevitably expensive with the Iranian route seen as the most viable.
India is also seeking to fight a trade route to the markets of landlocked Afghanistan, avoiding neighboring Pakistan amid ongoing territorial tensions over the Kashmir. So far, India has committed $500 million for developing Iranian port of Chabahar that is strategically crucial for achieving the goal. For Afghanistan, the corridor through the Iranian sea outlet means billions of dollars in trade and cutting the country’s foreign dependence for transportation aid.