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India picks Iranian firm to run Chabahar port

P Manoj Mumbai | Updated on June 08, 2018

Chabahar port is strategically important for the development of regional maritime transit traffic to Afghanistan and Central Asia   -  AFP

Arrangement to last for 18 months

India Ports Global has picked Bandar Abbas-based Kaveh Port and Marine Services company to run the Chabahar port in Iran as an interim arrangement for about 18 months from mid-June as India treads cautiously on operationalising the port in the back drop of sanctions being re-imposed on the Persian Gulf nation by the United States.

The selection of an Iranian operator was also necessary to comply with the contractual time lines particularly because efforts to pick an Indian firm to manage, operate and maintain (MOM) the container and multi-purpose terminals at Chabahar port have been delayed due to commercial and feasibility concerns, a government official said.

‘Risky proposition’

The government is set to dilute some of the tender terms to encourage the Indian firms to participate for the MOM deal that was put to tender earlier. However, potential bidders say the looming sanctions could still be a “risky proposition” for their participation.

“Kaveh Port and Marine Services has been mandated to run the Chabahar port for 18 months. By that time, we hope to finalise the Indian MOM partner and deploy all the key cargo handling equipment for which orders have been placed,” the official said, asking not to be named. India Ports Global has ordered four rail mounted quay cranes (RMQCs) for a combined $29.8 million from Chinese port crane maker Shanghai Zhenhua Heavy Industries Co (ZPMC) and 14 rubber tyred gantry cranes or RTGCs for about $18 million from Finnish crane maker Cargotec OYJ for erecting at Chabahar port.

India Ports Global, a 60:40 joint venture between Jawaharlal Port Trust and Deendayal Port Trust (previously Kandla Port Trust), was set up by the government to make strategic investments in ports overseas.

First overseas venture

India Ports Global and Aria Banader Iranian Port signed a deal in May 2016 to equip and operate the container and multi-purpose terminals at Shahid Beheshti — Chabahar Port Phase-I with capital investment of $85.21 million and annual revenue expenditure of $ 22.95 million on a 10-year lease.

Chabahar port project will be the first overseas venture for Indian State-owned ports such as JNPT and Deendayal Port Trust.

Located in the Sistan-Baluchistan Province on Iran’s South-eastern coast (outside Persian Gulf), Chabahar port is of great strategic importance for development of regional maritime transit traffic to Afghanistan and Central Asia.

The first phase development of Chabahar port will have a container terminal with two berths of 640 metre quay length and a depth of 16 metres and a multi-purpose terminal with a quay length of 600 metres and draft of 14 metres.

The port has a total back up area of 70 hectares.

Published on June 08, 2018

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