Iran and India had made an agreement to develop Chabahar to Zahedan Railway Project back on 23rd May 2016 during the Indian PM Narendra Modi visit to Iran. The same was renewed when the Iranian president visited India (15-17 February 2018). Despite these arrangements, the project did not materialize owing to the lack of funding from the Indian side after almost 4 years. As a consequence, the deal has been scrapped altogether by the Iranian government. Both sides are blaming each other for the delay in the project. Indians have termed this scrapping of the deal as a big loss for Modi’s Government. Tehran has apparently decided to complete the project on its own citing the absence of Indian involvement in the project so far.
Iran expected that India would play an active role in investments in Chabahar port by constructing a strategic railway line from Chabahar to Zahedan wherein it will connect with Zaranj in Afghanistan and up to Kabul. That line will be further extended till Sarakhas in Turkmenistan. However, the threat of US sanctions and the absence of tangible action by the Indian side has made Iran look towards other options. Iran had already stated its desire to be a part of China’s One Belt One Road (OBOR) strategic initiative after seeing the drawdown effects of the same in the shape of CPEC in neighboring0 Pakistan. One of the reasons for the bilateral hiccup was the Delhi Riots earlier this year when Iranian Foreign minister Javed Zarif openly condemned violence against the Muslim community. Secondly, India shut down energy imports from Iran after the threats of US sanctions. That adversely affected the Chabahar-Zahedan rail project. Thus, Iran had limited options available and hence dropped India from the Chabahar rail project.
India’s original plan for the Chabahar to Zaranj railway
CHINA-IRAN STRATEGIC DEAL
Iran has kicked India out of the Chabahar deal citing inordinate delay in funding from the Indian government. The surprise decision has come amid a momentous strategic partnership between Iran and China to the tune of US 400 Billion Dollars over a period of the next 25 years.
A 25-year China-Iranian strategic partnership was a matter of time in the light of recent developments. Last year, Iran’s Foreign Minister Mohammad Zarif paid a visit to his Chinese counterpart Wang Li for a new agreement that builds upon a previous deal that was signed in 2016. Oilprice.com managed to uncover many components of the agreement at the time. According to the publication’s source, Iran’s Petroleum Ministry confirmed that the deal has been signed and that Beijing has added security elements, with substantial implications for global security.
Continuation of the OBOR, ‘One Belt, One Road’ Initiative
China’s Partnership with Iran is part of its global development strategy known as Belt and Road Initiative BRI or OBOR, ‘One Belt, One Road’. CPEC is a pioneer component of the land-based strategy of the OBOR initiative by China. The Iranian government had the time and again expressed a desire to be part of this global initiative. Thus, this move can be better understood from this strategic viewpoint. An important component of the new 25-year pact is that China will invest $280 billion in developing Iran’s oil, gas, and petrochemical industries.
There will be another $120 billion of investment for the up-gradation of Iran’s transport and manufacturing sectors. Besides, Chinese businesses will be provided with the first choice to bid on new gas, oil, and petrochemical projects in Iran. This pact also represents a continuation of China’s ‘One Belt, One Road (OBOR)’ geopolitical program as Beijing will be involved in building Iran’s vital infrastructure. Chinese manufacturing companies will build factories using cheap labor in Iran to produce products that can enter Western markets via new transport links created by China.
Extensive Cooperation between Iran and China
Iran’s Supreme Leader Ali Khamenei has agreed to the extension of new military elements that were proposed by the Islamic Revolutionary Guard Corps (IRGC) involving complete aerial and navy cooperation between Tehran and Beijing, with Russia taking a central role. These arrangements will be accompanied by the launch of Chinese and Russian electronic warfare capabilities originally planned to offset NATO’s C4ISR (Command, Control, Communications, Computers, Intelligence, Surveillance, and Reconnaissance) systems.
As the world contends with the coronavirus pandemic, the 25-year agreement is a threat to the Trump administration and America’s hegemony for many reasons. It is a continuation of the OBOR initiative which is designed to take advantage of Beijing’s central position along the Eurasian mainland. The 25-year deal is going to extend China’s influence in the Middle East.
As The Diplomat argues, China’s geopolitical partnership with Iran is strategically important to both countries. Owing to its large oil and gas reserves, Tehran could help Beijing withstand an American attack on its Sea Lines of Communication. The continued existence of a strong regime in the heart of the Middle East thwarts Washington’s ambitions of maintaining its hegemony in the Middle East. Thus, this partnership has global security connotations.
The 25-year agreement also challenges the Trump administration’s policy of ending the 2015 Iran Deal that Barack Obama, the current US President’s predecessor, signed. Both China and Russia are members of the UN Security Council and Beijing is using its membership of this body to call on Washington to end its sanctions against Tehran. Zhang Jun, China’s permanent UN representative, stated in the Security Council urging the US to stop its “illegal unilateral sanctions” against Iran.
As the EU continues to trade with Iran, Trump has no allies left who are willing to support his position on the Iran deal. It is not clear whether Beijing and Moscow are going to support the removal of sanctions in exchange for Tehran surrendering its nuclear program, but the 25-year pact means both China and Russia have a vested interest in preventing the US and NATO from undermining their Middle Eastern ally.
Significance Of Gwadar Port In The Context Of Cpec And Obor
Gwadar is important deep water and warm water port in Pakistan. Gwadar port has the potential to connect three regions, e.g., South-Asia, Central Asia, and the Middle East. It is located at a distance of 700Kms from Karachi and 75kms from Chabahar. It provides the shortest passage to China for its burgeoning imports and exports. China imports 60 percent of its oil from the Middle East which reaches China through Indian and Pacific Oceans after covering 16000Kms in 3 months.
It has to go through the South China Sea with proximity to the US and Indian Navy Armada that may pose significant security challenges in case of a conflict. Contrarily, China can safely secure its energy and trade corridor by opting for Gwadar port as it is located at a distance of only 2000 Kms from mainland China. This is the main reason that China is building Gwadar port and highway networks in Pakistan as part of CPEC to materialize its full benefits. Russia, Central Asian countries, Iran and Afghanistan have also desired to be part of this strategic initiative to reap the rewards. It is all part of the global One Belt One Road OBOR initiative of the Chinese leadership.
This is an important cornerstone of the OBOR initiative that focuses on the revitalization of the land-based economic belt formerly part of the old “silk route”. Even India can also use Pakistan’s land routes for its trade activities with the Central Asian Republics, Iran and Afghanistan. The current scenario wherein an ultra-Hindu Nationalist Government is governing India has made this a distant possibility due to its constant sabotage activities in the Pakistani territory.
The Iran-India Chabahar railway project was initially proclaimed to counter and negate the China-led CPEC in Pakistan. However, the recent announcement by the Iranian leadership has put to rest its viability for now. Its timing in the current geopolitical scenario has the st significance wherein India is already under pressure in the Ladakh region by the Chinese forces and the subsequent partnership of China with Iran minus India has raised eyebrows among the global players. The addition of Iran in the Chinese OBOR initiative bodes well for Pakistan as well. The role of Pakistan in the China-Iran partnership has been very significant.
The latest development has strategic connotations for Pakistan and Iran vis-à-vis China. Chabahar port’s feasibility has to be measured in terms of US-Iran and China-Iran relations. US sanctions and trade barricades have made life difficult for the Iranian regime since the advent of the Trump administration’s hard-line against Iran. In that scenario, it was already going to be difficult for India to keep investing in Chabahar at the detriment of the US. The current closeness of US-India leadership was also one of the causes of this failure. China is one of the trading partners of Iran and had already wanted Iran to be a part of the OBOR program.
Pakistan government had openly asked the Iranian leadership to join the CPEC. Iran’s supreme leader Ayatollah Ali Khamenei had vowed that “Iran will not cooperate with America over the regional crisis; their aims in the region are 180 degrees opposed to Iran’s”. Cultural and religious commonalities between Iran and Pakistan lead Gwadar to an advantageous position in the current scenario. Pakistan and China have shown a strong commitment to complete the CPEC and the addition of Iran into the equation holds value for the project. Chinese investments in Pakistan are intended to develop trade routes with the Middle East and Central Asia and the strategic agreement with Iran is a game-changer.
On the contrary, Iran-India dynamics were a little different. India’s sole purpose was to reach the central Asian republics at the cost of Iran’s national interests by using its land for subversive activities against Pakistan. The case in point was the capture of Kalbushan Jadav. Pakistan has much to gain from the recent developments but we have to be proactive and complete our part of the bargain at the earliest. Once The Gwadar port is fully operationalized, its natural layout and depth will ensure the largest ships to dock easily as compared to Chabahar and Dubai.
The maximum planned capacity of Chabahar was 10 to 12 Million Tons per annum while the Gwadar port has the capability to 300 to 400 Million Tons once it becomes fully operational. If the project is completed and operationalized at its full capacity, it will have the capability to outstrip all Indian ports who collectively handle 500 Million Tons. This goes to show that the Strategic Triumvirate of Pakistan-Iran-China is going to rule the roost if the projected commitments are handled properly. Thus, it can be concluded that the Iranian decision to throw India out of the equation and engage with china and Pakistan has great economic and strategic potential for both Pakistan and Iran to China.