International North-South Transport Corridor (INSTC)

[ejazr]

To Russia via Iran: India bets on ambitious route - Indian Express

India is working with Central Asia on a transportation network that will pass through Iran and reach beyond the Caspian sea to Russia and Europe. It is in talks with Iran to develop an ambitious International North-South Corridor (INSC) that will unite Europe and Asia in a unique way and will reduce the time and cost dramatically. Moreover, according to official sources, it may also prove to be an effective way through which India can pay for Iranian oil by contributing towards the project.

According to government sources, India has agreed to provide expertise on issues such as customs, warehousing, paperwork and other infrastructure for the multi-modal transportation framework that will connect ports on the west coast of India to Badar Abbas in Iran on the Strait of Hormuz, further through land to Bandar Anzali port on the Caspian Sea and then through Rasht and Astara on the Azerbaijan border towards Kazakhstan, and further onwards towards Russia.

This project would connect Europe and Asia, and experts estimate the distance could be covered in 25-30 days from the present 45-60 days through the Suez Canal.

"This is also being touted as a way to pay for the oil we import from Iran. India can adjust its rupee account for the work being done on the project for making payment towards oil," an official said.

Though the project is not new given that a framework agreement was signed between India, Iran, and Russia in 2001, what is of significance is the timing of the renewed interest in the project.

Ever since the Reserve Bank of India scrapped a settlement system denominated in dollars and euros in December 2010, India has been struggling to find a mode of payment for Iranian oil. Moreover, the recent sanctions by the US on Iran have made the matter worse for India. India imports 12 per cent of its oil from Iran.

After a meeting was held in January with Bulgaria, Iran, Kazakhstan, Kyrgyzstan, Russia, and Tajikistan, a team was sent to Iran to identify the rail links that need to be completed for the project to start. Iran has assured that the missing train link is likely to be completed by 2014, officials said.

Some 16 countries have shown interest in the project including Azerbaijan, Belarus, Oman, Turkey, Ukraine and Armenia.

Further, in a meeting held on March 29 in New Delhi, India pledged its support for the requisite infrastructure.

The project assumes significance given the fact that India can't use routes through Pakistan and Afghanistan because of the uncertainty in the region. All these countries are oil rich and India is yet to harness the huge potential offered by these countries.

 

[Ray]

A good move by India.

Ideal way to show friendship with the friendly countries.

 

[Ray]

Quote Originally Posted by amoy View Post
Maybe u won't like the idea , another south-north route - connect to Kathmandu-Xigaze railway under construction, to access C. Asia via Xinjiang (Kashgar or Alashankou)

Nepal requires to be linked with China.

It is after all dependent on China for a variety of reasons.

Nepal can export all the way through China and not depend on India.

Of course, Nepalese goods exported through Chinese ports will be expensive, but China can always subsidise it and do it on a 'friendly' rate.

Good for Nepal and good for China!

 

[Ray]

The Chahbahar port, that India built in Iran, will become a hub.

It will permit moving of goods to countries North of Afghanistan and who knows how that gets funnelled into Afghanistan for the ISAF. It is obviously to Iran's advantage that the Pakistan (Sunni) based Taliban does not get an upper hand at the expense of the minority Shias in Afghanistan!

Conjecture, but then there are many oddities that occur in foreign policy.

In this context this is report is of interest:

India Set To Be Bigger Player In Afghanistan NATO Transport?

The U.S. military might rely on India as a way of getting equipment in and out of Afghanistan if Pakistan doesn't cooperate, a senior military official has said. The official, Marine Lt. Gen. Frank Panter, deputy commandant for installations and logistics, testified at a Congressional hearing on Thursday and was asked about the U.S.'s plans if Pakistan doesn't soon start to allow U.S. and NATO supplies to again transit that country. He said India would be part of the solution, according to a report from the Press Trust of India.
Pakistan | EurasiaNet.org

 

[ejazr]

India-Azerbaijan Economic meet finished today. Looks GoI is seriously taking this corridor and wants it operational by 2014

Business Line : Industry & Economy / Economy : India for fast-tracking transport corridor to boost trade with Azerbaijan
New Delhi, April 17:

India wants to fast-track the setting up of an International North-South Transport Corridor (INSTC) to improve connectivity with Azerbaijan. The transport corridor will also help save time and transportation costs.

[The INSTC member countries include India, Iran, Russia, Azerbaijan, Armenia, Kazakhstan, Kyrgyztan, Tajikistan, Turkey, Ukraine, Belarus, Oman, Syria and Bulgaria (observer).]

During a meeting in Baku with Mr Huseyngulu Baghirov, Minister of Ecology and Natural Resources of Azerbaijan, Mr Jyotiraditya M. Scindia, Minister of State for Commerce and Industry, called for identifying the impediments that block the smooth functioning of the transport corridor, an official statement said on Tuesday.

OIL & GAS

Meanwhile, India also expressed keenness to participate in the exploration and development of oil and gas fields in Azerbaijan. India also sought to use the Baku–Tbilisi–Ceyhan (BTC) pipeline for evacuation of oil to meet India's energy security needs.

During the bilateral meeting, Mr Scindia identified petroleum, IT, food processing and pharmaceuticals as the sectors with the maximum potential for trade and investment with Azerbaijan.

The Minister also called for an early finalisation of a Bilateral Investment Promotion and Protection Agreement and the Double Taxation Avoidance Agreement between the two countries to encourage investment flows and elevate investor's confidence.

At the bilateral meeting, a protocol was inked identifying pharmaceuticals, energy, transport, agriculture and IT sectors as the key areas of cooperation. It also suggested steps to overcome the existing barriers.

 

[ejazr]

Scindia was in Azerbaijan recently.

GoI press release
Press Information Bureau: Jyotiraditya Scindia leads Indian Delegation to Baku

 

[ejazr]

The Hindu : Today's Paper / NATIONAL : India to go ahead with meet, with Iran as key player

New Delhi undeterred by Hillary Clinton's counsel to pare down interaction with Tehran


Meeting aims to identify missing links — roads, rails and funds
India eyeing routes to evacuate hydrocarbons, mineral sops it may gain in Central Asia



Undeterred by United States Secretary of State Hillary Clinton's counsel to pare down interaction with Iran, South Block is going ahead with a meeting here next week in which Tehran will have a major role to play.

The three-day expert level meeting on the North-South Corridor — which began as an Iran-India-Russia initiative but now has over 15 countries interested in the project — is aiming to be different from the usual conferences that dot the diplomatic calendar.

India expects it to submit recommendations after representatives from about a dozen countries have not only interacted among themselves but also the actual users such as shippers, transporters and exporters. These recommendations will then be submitted to the Coordination Council meeting scheduled in Azerbaijan.

Finding the gaps

The aim of the meeting, a follow-up to an earlier interaction also hosted by India in January, is to identify concretely the missing links — roads, rails and the funding required. It will also address "softer issues" such as customs and immigration procedures and whether truck drivers get visa etc. "The idea is to get into details and find out about the gaps," added official sources.

The "key question" is what Iran will bring to the table at next week's meeting, said government sources. "It is because of Iran's problems that the project, which took off in 2002, is still languishing. All this is predicated on the port of call being Bandar Abbas [which will lead to Russia and other countries via the Caspian Sea]," they added.

Paperwork gains tempo

India, say the officials, has taken the lead in accelerating the paperwork on the corridor so that it can fructify at a time when New Delhi will be looking for routes to evacuate hydrocarbons and mineral concessions it plans to gain in Central Asia and the Caucasus as well as benefit from the Russia-Kazakhstan-Byelorussia customs union which will by then have expanded to include other Eurasian countries.

Explaining the work that remains for seamless connectivity from Bandar Abbas to the north and the north-west, officials have said there are missing railways links of about 200 km, many of which are on the Iranian side. Then a hard look will have to be taken at the customs procedures so that there are no hitches while goods pass through several countries. In the absence of an entry point from the warm waters of the Indian Ocean, Indian commerce relies on entry into Russia through St. Petersburg and Kotka, the European port of Rotterdam and Ukrainian ports of Illychevsk and Odessa.

 

[ajtr]

This rail network if build through Pakistan will be much cheaper and shorter.Moreover it can re-build pakistan's fragile rail network too.

 

[LETHALFORCE]

This rail network if build through Pakistan will be much cheaper and shorter.Moreover it can re-build pakistan's fragile rail network too.

Can you provide link? Last I heard Pakistan does not have domestic railroad engines
importing from India.

 

[LETHALFORCE]

How will this be done? See the map I have posted. PoK is not Pakistan. PoK is Pakistan Occupied Kashmir. My map shows link through Gilgit.

This is why we should use the Siachen position to our advantage and soon.

 

[ejazr]

This rail network if build through Pakistan will be much cheaper and shorter.Moreover it can re-build pakistan's fragile rail network too.

The decision to bypass Pakistan has already been taken. In any case, the North South Corridor is to benefit Central Asian states and Afghanistan by providing them an alternative route even if Pakistan does come on board later and give competition. In the meantime, it will provide India with access without Pakistan to Central Asia.

 

[Ray]

This rail network if build through Pakistan will be much cheaper and shorter.Moreover it can re-build pakistan's fragile rail network too.

Pakistan is too fragile a nation as far as security is concerned to have a railway connection through it to connect beyond.

It does not have the prime movers (engines) and their maintenance is poor. The Chinese have claimed that the Chinese engines were ruined, not because the engines were shoddy, but also because of lack of maintenance.

So, Pakistan should be left alone.

 

[thakur_ritesh]

Good to see the INSTC being pushed ahead, any idea on the total investment required, and how much is India committing?

Ejaz,

Has the 2014 deadline already been committed?

 

[ajtr]

Pakistan is too fragile a nation as far as security is concerned to have a railway connection through it to connect beyond.

It does not have the prime movers (engines) and their maintenance is poor. The Chinese have claimed that the Chinese engines were ruined, not because the engines were shoddy, but also because of lack of maintenance.

So, Pakistan should be left alone.

Love it or loathe it but you (indians)can't ignore it

 

[Singh]

The Chahbahar port, that India built in Iran, will become a hub.

It will permit moving of goods to countries North of Afghanistan and who knows how that gets funnelled into Afghanistan for the ISAF. It is obviously to Iran's advantage that the Pakistan (Sunni) based Taliban does not get an upper hand at the expense of the minority Shias in Afghanistan!

Conjecture, but then there are many oddities that occur in foreign policy.

In this context this is report is of interest:

India can broker tensions between Iran and Nato. And offer NATO access to another route into Afghanistan through Chahabahar port and Zelranj Highway connecting it to Afghanistan. Hell the goods can be marked Humanitarian relief to satisfy the hypocrites on either side.

 

[Singh]

This rail network if build through Pakistan will be much cheaper and shorter.Moreover it can re-build pakistan's fragile rail network too.

Actually this corridor is being built to bypass Pakistan.

 

[ejazr]

@thakur_ritesh

The agreement between Russia-Iran-India has been pending since 2001 so we can't really guarantee end dates.

But atleast from start of this year, there is renewed focus on this project again. Moreover, the Iranian oil barter system gives India leverage in completing the Iranian portion of the project in return for payment. Something which India has already offered. IRan was delaying completing its part of the corridor citing financial difficulties. The other major change is that Pakistani NATO supply routes are no longer in use and US may have discretely given the go ahead for India to complete the Iranian based corridor so that non-lethal supplies can come to NATO and later to Afghan security forces.

Earlier, the US had pressurised India with the favour that they will give India a transit agreement via Pakistan. They did try to deliver on this but failed because it ended up being only a one way agreement for Afghanistan. Now that US is going to be unable to deliver this to India, it makes sense to stop waiting for it and finish off the Iran corridor ASAP.

There is going to be a 12 member meet possibly in June (was suppose to be in March but got delayed) that will give final touches to the project. Lets see what happens then and we might get more details on route, investment and timelines.

 

[Bangalorean]

This rail network if build through Pakistan will be much cheaper and shorter.Moreover it can re-build pakistan's fragile rail network too.

How about this: the Pakis should dismember their useless nation themselves and come up with independent Balochistan and independent Sindhudesh. That will give us our rail access to central Asia.

I will be among the first persons to travel overland to Europe - maybe even drive over. ::thumb::

 

[Sakal Gharelu Ustad]

Despite U.S. opposition, Iran to be transport hub for North-South Corridor

A multi-nation transport corridor that would radically reduce cargo transportation time between India on one side and Central Asia and Russia on the other with Iran being the pivot could see dry runs beginning next year.

A three-day meeting of experts from 16 countries discussed ways to smoothen the way for the International North South Transport Corridor (INSTC) and at least six supplementary routes despite the U.S. pushing its Silk Road proposal in which its bete noire Iran has been excluded.

In stark contrast, Iran plays a crucial role in the multi-modal North-South Corridor as its port Bandar Abbas will be the hub of all activity. Experts proposed the setting up of two four-nation groups to resolve many of the ssues. Iran along with Russia and India (all three initiators of the project) will be in both groups.

The meeting on the INSTC which ended here on Wednesday proposed a joint venture between Iran, India, Russia and Azerbaijan to find solutions to aspects such as infrastructure and funding. It also suggested a core group on customs — India, Russia, Iran and Turkey — consisting of experts from these countries, based in Delhi to sort out issues.

When India pointed to the missing link of 500 km in Iran that could impede the project, Tehran gave some good news. It said 372 km of the Quazvin-Rasht-Astra was complete and the contractor identified 163 km of the Rasht-Astra route. But there were technical problems in the last leg leading up to Azerbaijan. The experts suggested that a fund may be created to help Iran complete the route as quickly as possible.

The meeting was aimed at achieving progress on four fronts — identifying the residual construction on the main North-South Corridor and the time frame for completion of the work, identification of bottlenecks and action plan for the resolution, action plan along with the time frame for harmonisation of customs and insurance documents and procedures and identification of complementary routes and their status and actionable points for member-countries.

The experts indicated the need for funds to the tune of $700 million (over Rs. 4,000 crores) to ensure that portions of the proposed East-West corridor connecting the Persian Gulf to Central Asia and China could be linked to the North-South corridor.

The Hindu : News / National : Despite U.S. opposition, Iran to be transport hub for North-South Corridor

 

[ejazr]

So looks like the corridor will bypass Afghanistan as well. Azeri-Iranian ties are not up to the mark at present, but hopefully that should not be an impediment in resolving the corridor.