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.
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.