Interim operations in Chabahar port in Iran to start by next week

Notwithstanding the plans by the United States to impose fresh sanctions on Iran nuclear deal, India is all set to begin interim operations in the strategically important Chabahar port project next week, shipping ministry officials familiar with the development said.

India has selected an Iranian company, Kaveh Port and Marine Services, for running the operations for 18 months till it selects a firm to manage and maintain the facility for long term. As per the memorandum of understanding signed between India and Iran in May 2016, India would equip and operate two terminals in Chabahar port Phase-I with a capital investment of $85.21 million and annual revenue expenditure of $22.95 million on a 10-year lease.

“We have been able to enter Chabahar port for interim operations, which will start from June 13,” said shipping secretary Gopal Krishna.

The shipping ministry has also started the process to invite fresh bids to select an Indian partner to manage, operate and maintain the port for the next 10 years.

None of the three companies -- Adani, JSW and International Cargo Terminal & Infrastructure Private Limited — shortlisted in the technical bid earlier participated in the financial bid owing to stringent conditions. One of the clause required the successful bidder to pay an upfront payment of US $8.52 million as premium.

Following complaints from the shortlisted companies over the bid norms, the shipping ministry referred the matter to an inter- ministerial panel. “The group of ministers last month decided to ease the bid conditions, including removing the clause to pay premium,” said an official of India Ports Global Private Limited (IPGPL) who didn’t want to be named. IPGPL is a joint venture between Jawaharlal Nehru Port Trust and Kandla Port Trust, set up to implement the project.

One of the officials said, “We were charging a premium from the successful bidder to meet our preliminary expenses. But the shortlisted bidders said that the project is of strategic importance and is not commercially viable.”

Chabahar port located in the Sistan-Baluchistan Province of Iran on the south-eastern coast is of great strategic importance to India. It will provide India an alternative and reliable access route into Afghanistan, bypassing Pakistan. This would also give India access to resource-rich Central Asia.