The Chabahar Port in Iran has gained renewed global attention in 2025. This follows the revocation of the US sanctions waiver that previously allowed India to operate the Shahid Beheshti Terminal without facing penalties. The decision challenges India’s $120 million investment and its strategic ambitions in the region. Chabahar remains a vital asset amid shifting geopolitical dynamics involving India, Iran, the US, China, and Russia.
Geopolitical Importance of Chabahar
Chabahar Port is located on Iran’s southern coast by the Gulf of Oman. It serves as India’s access point to Afghanistan and Central Asia, bypassing Pakistan. The port counters China’s Gwadar Port in Pakistan, part of the China-Pakistan Economic Corridor (CPEC). Chabahar is also a key node in the International North-South Transport Corridor (INSTC), linking Mumbai to Moscow through Iran and Azerbaijan. Its strategic position makes it a focal point of regional power competition.
India’s Investment and Operations
India Ports Global Limited (IPGL) operates the Shahid Beheshti Terminal at Chabahar. The $120 million investment focuses on modernising port infrastructure and enhancing cargo handling. The port can accommodate large vessels up to 120,000 deadweight tonnage (DWT), including container ships and passenger ferries. Indian equipment and personnel are present, signalling India’s active role in port development.
Challenges from Sanctions and International Pressure
The US revoked the sanctions waiver under the Iran Freedom and Counter-Proliferation Act (IFCA) in September 2025. This exposes Indian operators to potential secondary sanctions. The move complicates India’s ability to maintain and expand its presence. It also raises questions about balancing economic interests with international diplomatic pressures, especially from the US.
Local Development and Economic Vision
The Chabahar Free Zone Authority aims to transform the surrounding region into a trade and logistics hub. Currently, infrastructure such as housing, schools, and hospitals is minimal or absent. Plans include inviting Indian companies to invest in oil, infrastructure, and cultural projects. A proposed cricket stadium with Indian collaboration symbolises efforts to deepen cultural ties and promote regional integration.
Strategic Rivalries and Regional Dynamics
Chabahar’s proximity to Gwadar Port marks the strategic rivalry between India and China in the Indian Ocean region. While Gwadar is linked to China’s Belt and Road Initiative, Chabahar provides India a foothold to counterbalance Chinese influence. Iran’s cooperation with India is critical yet delicate due to its relations with both the US and China. Russia’s interest in the INSTC adds another layer of complexity.
Future Prospects and Uncertainties
Chabahar’s future depends on India’s response to sanctions and evolving geopolitical alliances. The port’s potential as a trade gateway and strategic asset is . However, international pressures and regional rivalries pose risks. India’s commitment to Chabahar will shape its regional connectivity and influence in South Asia and beyond.
Questions for UPSC:
- Point out the strategic significance of the Chabahar Port for India’s foreign policy in South Asia.
- Critically analyse the impact of US sanctions on India-Iran economic cooperation with suitable examples.
- Estimate the role of maritime infrastructure in enhancing India’s connectivity under the International North-South Transport Corridor.
- Underline the geopolitical rivalry between India and China in the Indian Ocean region and its implications for regional stability.
