International North South Trade Corridor (INSTC)

In News: India wants Chabahar port to be included in the 13-nation International North South Transport Corridor that extends from India to Russia and expand INSTC membership by including Afghanistan and Uzbekistan

International North South Trade Corridor (INSTC)

• It is a 7,200-km-long multi-mode network of ship, rail, and road route for moving freight between India, Iran, Afghanistan, Azerbaijan, Russia, Central Asia and Europe.
• The route primarily involves moving freight from India, Iran, Azerbaijan and Russia via ship, rail and road.
• The objective of the corridor is to increase trade connectivity between major cities such as Mumbai, Moscow, Tehran, Baku, Bandar Abbas, Astrakhan, Bandar Anzali, etc.
• Dry runs of two routes were conducted in 2014,
  • The first was Mumbai to Baku via Bandar Abbas .
  • The second was Mumbai to Astrakhan via Bandar Abbas, Tehran and Bandar Anzali.

Chabahar as the Major Link

• Pitching for Chabahar in the INSTC which goes via Iran’s biggest port Bandar Abbas, Mr. Jaishankar proposed that the land route via Kabul and Tashkent would form the INSTC’s “Eastern corridor”.
• Chabahar is one of crucial and strategic projects taken up by India.
• Benefits:
  • Counters Chinese Influence in Gwadar.
  • Helps in access to Afghanistan.
  • Represents India’s capability to build and operate ports in foreign countries.

Challenges in Completing the Project

• US sanctions: The sanctions by the US are most difficult to overcome.
• Chinese Tilt of Iran due to Delays: Due to slow pace of work, Iran was playing the China card and started part of the project on itself.
• Decreasing Imports and Exports: The exports and imports have significantly redcued between India and Iran.

Way Ahead

• A separate arrangement for currency exchange between the two nations.
• India has to reduce its red tapism to fasten execution of Chabahar port.

Source: TH