The shadow over Chabahar’s fate

Published: Tue, 01/16/2018 - 11:04 Updated: Fri, 01/19/2018 - 10:00

The possibility of Russian support to Chabahar lends a new spin to the contestation brewing between India, China and Pakistan

 

A few weeks after Chabahar port, whose management has been offered to India by Tehran much before its scheduled time, was inaugurated by Iran’s President Hassan Rouhani, China, which is funding a neighbourhood port in Pakistan’s Gwadar, made its move. During a trilateral summit of China, Pakistan and Afghanistan at Beijing, Chinese Foreign Minister Wang Yi offered to link Afghanistan with $53 billion China Pakistan Economic Corridor (CPEC), which connects Gwadar with Kashgar in China through an area disputed by India. Wang announced that Kabul was willing to join the CPEC. However, one can’t help but wonder where does it leave India’s grand design to use Chabahar to side step Pakistan to reach its goods to Afghanistan and beyond?

 

China said that the CPEC or the offer made to Afghanistan was not directed at any country (read India). On December 3, Iran’s President Rouhani had similarly tried to put the fears of Pakistan and China to rest when he was flagging off the Chabahar port. Their anxieties stemmed from the Indian investment in the development of the strategically significant Iranian port and how it could not just make Gwadar unviable, but also threaten its security. So, both China and Iran may give an impression that all is well with the way the two projects are evolving, but it is fooling no one. Both the countries and the neighbourhood are aware of the strategic importance of these ports and are also conscious of how the waters of the Oman Sea could be the scene of regional power contestation in the future. How US and Russia, both major players in this region, countenance these connectivity projects could perhaps determine how this face-off plays out.

 

Chabahar was always part of Tsar Russia’s quest for a warm water port. British diplomat and author Olaf Caroe, in his book Wells of Fire, writes about the Russian government sending officials of the ministry of roads and port at the turn of the century to scout for a port. They found Chabahar port’s climate more moderate than the Gwadar Road. The Russians could not really build on their plans as the revolution threw out the Tsar regime. Thereafter, its successor state, Soviet Union, invaded Afghanistan to prevent an imperial Iran from enlarging its influence in Kabul. Shortly thereafter in 1979, Shah of Iran Reza Pahlavi was ousted in an Islamic Revolution in Tehran — an epochal happening that sharpened the sectarian divide amongst Muslims and also changed the balance of power in the region.

 

Twenty-nine years later, the region, after experiencing every shade of political and social convulsion, is presenting an opportunity to Russia to fulfil its objective of accessing the all-season ports of Bandar Abbas and Chabahar in Iran by activating its North-South Corridor which provides a road and sea route between Europe and India. In many ways, the viability of Chabahar Port would not just be determined by its ability to restore India’s trade links with Afghanistan, but by exploring cheaper and quicker trade routes to West Asia, Africa and Europe. A test run of some Indian shipment from Kandla port in Gujarat through Bandar Abbas port of Iran and beyond saw a reduction of 21 days of travel in comparison to the one undertaken through Suez Canal. Both Russia and Iran, ravaged by economic sanctions, lay great importance on revenue earned through transhipment. Last year, Iran earned more from goods being transhipped through its country than the sale of oil and gas. Iran and Russia, both see the wisdom in opening up new land routes and waterways to earn to keep their respective economies ticking. Iran is surrounded by seven countries to Russia’s 14 — both provide a compelling logic for creating land and sea corridors that can safely provide passage to trade consignments to many countries. It is due to these reasons that during a visit to Delhi, Russian Foreign Minister Sergey Lavrov in a reply to a question about joining China’s CPEC categorically said, “Russia has its own corridors and has large territory for such corridors and connectivity initiatives.” Russia, which is largely bypassed by BRI has signed a cooperation agreement with China as part of Eurasian Economic Union (EEU), but hopes that different corridors promoted by different countries will converge to its advantage. The possibility of Russian support to Chabahar port lends a new spin to the contestation brewing between India, China and Pakistan. 

 

The Pakistani leadership had not been expecting the Iranian port to get activated so soon. In many ways, it was taken aback when India decided to dispatch the wheat consignment through Chabahar to Kabul two days after US Secretary of State Rex Tillerson’s visit to Delhi that was looked at as US’ nod of approval and an assurance that the country would not come in the way of the business ties between India and Iran. Also, New Delhi’s engagement with Kabul neatly fit with US President Donald Trump’s new Afghan policy that demanded greater responsibility from India to stabilise the war-torn country.

 

Though India was preparing to send the wheat shipment to Kabul and Herat for a while, the date was a closely guarded secret. Sources reveal that the Iranian ambassador to Delhi, Gholamreza Ansari, was asked by Delhi if it was possible for his country’s Foreign Minister Javed Zarif to mark his presence through a video conference when the shipment was flagged off from Indian port of Kandla on October 27, 2018. As the time was too short, the Iranian FM could not show up for the programme, but the message went out loud and clear that Chabahar was ready for business.

 

That the Iranian threat was hollow was apparent from the very beginning. Many Indian commentators had prematurely announced the death of Chabahar, saying that the government here would not dare to antagonise the US government under the Trump presidency. Interestingly, this proved to be a flawed assumption.

 


Iranians officials that this writer spoke to said that India used the dispatch of the wheat shipment to exercise strategic autonomy. As elucidated above, the Iranians were caught off guard when the Indian government announced their decision to move the shipment and sought Zarif’s presence through a video conference to flag it off.

In fact, the port and its free zone have been ready for quite some time. When this writer visited Chabahar in 2016, it seemed ready for Indian engagement. No one was in doubt here or in capital Tehran about who was to run this Iranian port — India. 

 

Here’s a trivia fact for those who have not travelled to these parts of the world — ancient traveller El-Beruni believed it to be the starting point of the Indian sub-continent and it truly is! Besides its four seasons, the people here also speak very fluent and clean Hindustani, which they call Urdu. Perhaps this has to do with its proximity to Pakistan, but it could also be due to the popularity of Bollywood films in these parts.

Before we proceed any further, it will be wise to dwell a bit on the Chabahar Port and what it means for India and others. The discussion for building the port began during the period of Shah of Iran who wanted to bring in some US Companies to build the infrastructure around the port. The Islamic Revolution in 1979 put the development on hold, but this port was used by the Iranian Navy to keep its fleet protected from Iraqi threat. Even now, Chabahar’s strength remains its distance from Strait of Hormuz, where Bandar Abbas is located.

 

In 2016, Prime Minister Narendra Modi signed the trilateral transit agreement that included Afghanistan and Iran. A trade corridor was conceived that originated in Chabahar and culminated in Afghanistan. India promised to invest $500 million in the development of a berth in its port Shahid Beheshti. India also committed to spending $1.2 billion to construct a railway line from the port to the Iranian border town of Zahedan. This was to link, later, with the Iranian railway network. In one of his trips to Chabahar, Indian Shipping and Transport Minister Nitin Gadkari promised an investment of $20 billion in the next few years. All this was music for the Iranian authorities who were displaying impatience at the glacial pace with which India was going about executing the project. Before his trip, the Iranians had conveyed to Indians that they would consider giving the project to the Chinese who had invested $53 billion in the nearby Gwadar port project in Pakistan. For the Chinese, on the other hand, it would have made great sense to get the strategic Iranian port to not just increase the viability of its investment in Pakistan, but also snuff out the nuisance of Indian challenge in nearby waters.

 

That the Iranian threat was hollow was apparent from the very beginning. Many Indian commentators had prematurely announced the death of Chabahar, saying that the government here would not dare to antagonise the US government under the Trump presidency. Interestingly, this proved to be a flawed assumption. This writer was in Tehran a day before the results of the US elections were to be announced. At that time, people were hoping that the dice rolls in favour of Trump and not Hillary Clinton, who in their reckoning was a hawk and mixed up with Israel. The Iranian assessment was based on how Trump during his campaign had targeted “fake news” and blamed Clinton and the “deep state” for much of the tension in the Middle East. Next day when the results were declared, there was understandable glee in Tehran’s media and government circles that Clinton had lost and a businessman would be the President of the USA. Much water has flown since his election and Trump has proved to be far more hawkish and pro-Israel than Tehran intelligentsia was expecting. He has threatened to annul nuclear deal with Iran and has backed Israel and Saudi Arabia’s narrative on the enlargement of the Shia crescent. However, the Iranians still draw comfort from the fact that Trump has not done much harm to them. He has not really walked the talk on many issues.

 

Iranians officials that this writer spoke to said that India used the dispatch of the wheat shipment to exercise strategic autonomy. As elucidated above, the Iranians were caught off guard when the Indian government announced their decision to move the shipment and sought Zarif’s presence through a video conference to flag it off. The shipment helped in announcing the activation of the Chabahar port, which surprised Pakistan and China as they thought that India did not have the courage to move fast on Chabahar lest it could antagonise the US government. They drew solace from reports that Iranians had put on hold many deals with India, including oil field Farzad-B, due to both Indian sloth and intransigence on pricing. They saw far too much in the Russian President Vladimir Putin’s visit to Tehran without reading the fine print into the $20 billion worth of oil sector deals that he signed. An Iranian official clarified to this writer that Farzad-B was not included in the Russian deal, but many in the Indian media reports had already declared “death to the Farzad-B deal.” Iranian officials took pains to explain that President Rouhani was clear that Chabahar Port and Farzad- B should go to India. Negotiators were told that as long as Iran was not seen as bending too much or incurring a loss on Farzad-B, it should go ahead and sign the deal with New Delhi. Till last heard, the negotiations were still carrying on.

 

Similarly, the Indian media continued to write that Iranians were on the threshold of giving control of Chabahar to China when they had in reality sent this offer to India two years ahead of schedule. While making clear its strategic choice, Iranians were keen to put the fears of Pakistan and China to rest. President Rouhani presented Chabahar as an international commercial port and invited other countries to invest in its sprawling free zone.

 

Chabahar’s activation worried the Pakistanis, who sent their Army Chief to Kabul, offering them a new trade and transit treaty that they are refusing to negotiate till Indian trucks are allowed to come to their border. Pakistan does not allow Indian trucks to transit through their territory to Afghanistan. It may be possible to spurn Pakistan, but not when the Chinese provide heft to the offer of extending CPEC to Afghanistan. After the trilateral summit in Beijing, the Chinese Foreign Minister happily announced that Afghanistan is willing to join the CPEC, which could jeopardise Indian plans till there is a strong strategic logic for India to stay invested in Iran project even if Afghanistan shows ambivalence towards the project due to any count.

 

It is here that the Russians through their 7,200-kilometer North-South Transport Corridor provide the justification for India to remain invested in Chabahar and Iran. This route cuts down travel time to European destinations by 40 percent and also costs. It holds immense economic logic to use the road route for those who are shipping their goods as well as those who benefit from transit fees. Iran, for instance, claims that it has not even fulfilled 10 percent of the transhipment potential.

 

Russians are cognisant of India’s problems with CPEC as it passes through the disputed area near Karakoram Highway. They do not want to get caught up in the cross-fire between India, Pakistan and China, but they are suggesting some corrections in CPEC to take care of Indian concerns that mean connecting India through Lahore. This scenario seems impossible at the moment, but China would not like its investment to get compromised by India-Pakistan tensions. So there are many suggestions floating around in diplomatic circles about what it would take for India to join the Belt and Road Initiative (BRI). The manner in which China has nibbled away India’s influence in its well-guarded neighbourhood has compelled New Delhi to engage in a serious introspection. Recently, a former head of state was in Delhi, carrying a message from Beijing to ascertain what it will take for India to join the BRI. It will be interesting to watch how this plays out.

 

All these diplomatic moves may cast a shadow over Chabahar’s fate if it is only meant to provide an alternative route to Afghanistan to trade with India and other countries. These doubts have sprung up in Delhi also where there are fears that its investment in Afghanistan cannot be saved if Pakistan increases its influence through the Taliban. If that happens, then Chabahar would have to realign itself with central Asia and North-South Corridor to maintain viability. Russians are also hopeful that Chabahar, which is likely to attract Japanese investment too, could join up the Eurasian Economic Group that President Putin is pushing so vigorously.

 

What is really visible and clear is that the rules and the goal posts of this great game are still not settled.   

 

Editor of Delhi's Hardnews magazine and author of Bad Money Bad Politics- the untold story of Hawala scandal.

Read more stories by Sanjay Kapoor

This story is from print issue of HardNews