The second India-Iran-Armenia Trilateral Consultations took place in New Delhi recently. The focus was on enhancing the International North South Transportation Corridor (INSTC) and the strategic importance of Chabahar Port. This meeting built on discussions from the previous consultations held in Yerevan in April 2023. The three nations aimed to boost connectivity, trade, tourism, and cultural exchanges, while encouraging people-to-people ties.
Overview of INSTC
The International North South Transportation Corridor is a key initiative for India. It aims to create a multi-modal transport network connecting India to Russia and Europe. The corridor offers an alternative route for trade, reducing transit time and costs. Despite slow implementation, INSTC has seen increased trade between India and Russia in recent years.
Chabahar Port’s Role
Chabahar Port in Iran is crucial for the INSTC. It provides India with direct access to the Persian Gulf. This port is for enhancing trade routes and facilitating cargo movement. It serves as a strategic counter to China’s Belt and Road Initiative, which poses sovereignty concerns for India.
Recent Developments in Armenia
Armenia has taken steps to join the INSTC. The Armenian Parliament approved a $200 million loan for building a tunnel in Syunik, which borders Iran. This infrastructure project is essential for improving connectivity and facilitating trade through the corridor.
Trade Routes of INSTC
INSTC comprises three main routes. The Trans-Caspian Route connects ports in Russia and Iran. The Eastern Route runs through Kazakhstan and Turkmenistan. The Western Route extends through Azerbaijan. Each route offers unique advantages for transporting goods between India, Russia, and Europe.
Future Prospects
The next round of trilateral consultations is scheduled to take place in Iran. Continued collaboration among India, Iran, and Armenia is vital for the success of INSTC. The project has the potential to enhance trade and strengthen regional ties.
Uzbekistan’s Interest
Uzbekistan is also keen to leverage the INSTC and Chabahar Port. Following a Bilateral Investment Treaty signed in Tashkent, Uzbekistan has begun sending cargo to India via the corridor. This marks the growing interest of Central Asian countries in the INSTC framework.
Challenges Ahead
Despite its potential, INSTC faces challenges. Infrastructure development in Azerbaijan has been slow. Moreover, the successful operationalisation of the corridor depends on the cooperation of all involved countries.
Significance of Multilateral Engagement
The trilateral consultations tell the importance of multilateral engagement in regional connectivity. Strengthening ties among India, Iran, and Armenia can lead to enhanced trade opportunities and cultural exchanges.
Questions for UPSC:
- Discuss the significance of the International North South Transportation Corridor in enhancing India’s trade with Eurasia.
- Critically examine the role of Chabahar Port in India’s strategic interests in the context of regional connectivity.
- Explain the potential impact of the INSTC on trade dynamics between India and Central Asian countries.
- With suitable examples, discuss the challenges faced by the INSTC and the measures needed to overcome them.
Answer Hints:
1. Discuss the significance of the International North South Transportation Corridor in enhancing India’s trade with Eurasia.
- INSTC connects India to Russia and Europe, facilitating trade and reducing transportation costs.
- It offers alternative routes, enhancing India’s trade competitiveness against other initiatives like China’s BRI.
- Increased trade volume between India and Russia has been observed in recent years via INSTC.
- Multi-modal transport network enables faster movement of goods across regions.
- Strengthens India’s geopolitical influence in Eurasia by encouraging closer ties with participating countries.
2. Critically examine the role of Chabahar Port in India’s strategic interests in the context of regional connectivity.
- Chabahar Port provides India with direct access to the Persian Gulf, enhancing trade routes.
- It serves as a counter to China’s Belt and Road Initiative, which raises sovereignty concerns for India.
- The port facilitates cargo movement to Central Asia and beyond, improving regional connectivity.
- Investment in Chabahar strengthens economic ties with Iran and other regional players.
- It plays important role in INSTC, linking India to other key markets in Eurasia.
3. Explain the potential impact of the INSTC on trade dynamics between India and Central Asian countries.
- INSTC offers Central Asian countries a reliable route to access Indian markets, boosting trade volumes.
- Facilitates faster transit times and reduced logistics costs for goods moving to and from India.
- Encourages regional cooperation and integration among participating countries, encouraging economic ties.
- Central Asian nations can leverage INSTC to diversify their trade partnerships beyond traditional routes.
- Improves access to Indian goods, enhancing consumer choices in Central Asia.
4. With suitable examples, discuss the challenges faced by the INSTC and the measures needed to overcome them.
- Infrastructure development, particularly in Azerbaijan, has been slow, hindering operational efficiency.
- Political instability in some regions can disrupt trade routes and logistics operations.
- Cooperation among member countries is essential; lack of coordination can delay projects.
- Investment in infrastructure projects, like the Rasht-Astara railway, is crucial for progress.
- Enhancing multilateral dialogues to address concerns and streamline processes can improve collaboration.
