India to sign port deal with Iran, ignoring US warning against haste

Wednesday, 6 May 2015 00:43 - - {{hitsCtrl.values.hits}}

Reuters: India will push ahead this week with plans to build a port in southeast Iran, two sources said, with Prime Minister Narendra Modi keen to develop trade ties with Central Asia and prepared to fend off US pressure not to rush into any deals with Iran. India and Iran agreed in 2003 to develop a port at Chabahar on the Gulf of Oman, near Iran’s border with Pakistan, but the venture has made little progress because of Western sanctions on Iran. Now, spurred on by Chinese President Xi Jinping’s signing of energy and infrastructure agreements with Pakistan worth $ 46 billion, Modi wants to swiftly sign trade deals with Iran and other Gulf countries. “Shipping Minister Nitin Gadkari will travel on a day-long tour to Iran to sign a memorandum of understanding for development of Chabahar port,” a shipping ministry source with direct knowledge of the matter told Reuters. The deal will be signed on Wednesday, he said. Encouraged by the prospect of a deal between world powers and Tehran by 30 June on Iran’s nuclear program, after which sanctions could be eased, India recently sent a delegation to Iran to scout for trade, energy and infrastructure deals. The United States cautioned India and others last week against strengthening ties with Iran ahead of a final agreement. But Indian officials said New Delhi could not ignore its national interest and noted a report that a US energy delegation was visiting Iran. “We don’t want to miss this opportunity and will move as expeditiously as possible,” the shipping ministry source said. India’s cabinet approved the plan to develop Chabahar port last year. Iran has also proposed a free-trade agreement with India, a trade ministry source said. Rupee-denominated trade with Iran, started in 2012 because of complications arising from sanctions, has almost doubled Indian exports to Tehran in the past two years to $ 4 billion.