Chabahar's Mega-Boost: India's ₹4,000 Crore Port Power-Up!

India is investing nearly ₹4,000 crore to expand operations at Iran’s Chabahar Port, aiming to increase capacity fivefold to 500,000 TEUs (twenty-foot equivalent units) over the next decade, according to the Shipping Ministry. As part of this expansion, India has placed orders for five mobile harbor cranes and is considering a second berth to enhance operations.

Chabahar Port, funded by India, is expected to handle 100,000 TEUs by FY26, nearing full capacity. In FY25, traffic is projected to reach 75,000 TEUs, having already crossed 65,000 TEUs by January-end—matching FY24 levels. Over the 10-year concession period, India Ports Global Ltd (IPGL), the port’s Indian operator, plans to modernize infrastructure and attract Indian shipping lines, with active marketing efforts to boost viability.

India’s Economic Survey 2024-25 highlights Chabahar’s strategic role in linking Mumbai to Eurasia via the International North-South Transport Corridor (INSTC), reducing transport costs and time. This has contributed to a 43% rise in vessel traffic and a 34% increase in container movement in FY24.

In May 2023, IPGL signed a 10-year contract with Iran’s Ports and Maritime Organisation to equip and operate Chabahar’s Shahid Beheshti Terminal. India has increased its grant assistance for port equipment to $120 million and committed a $250 million Line of Credit. Equipment worth $24 million has already been supplied, with further procurement underway.

Despite securing a US sanctions waiver for Chabahar due to its humanitarian role in Afghanistan and regional trade connectivity, future waivers remain uncertain amid shifting US policies.

Beyond Chabahar, India is expanding its regional maritime influence. IPGL now manages operations at Myanmar’s Sittwe Port, a key part of the Kaladan Multimodal Transit Transport Project linking Bangladesh, Thailand, and Kolkata. Additionally, India is developing Sri Lanka’s Kankesanthurai Port and planning a ferry service between Nagapattinam and Kankesanthurai to strengthen trade and passenger connectivity.

News by Rahul Yelligetti.