India’s investment in Iran’s Chabahar Port confirmed at $120 million

By Admin

15 Dec, 2025

India has officially confirmed an investment of USD 120 million in Iran’s strategically important Chabahar Port, marking a major step forward in bilateral maritime and infrastructure cooperation. The confirmation reinforces India’s long-term commitment to strengthening regional trade connectivity and expanding its strategic footprint beyond South Asia.

Confirmed Investment and Operational Progress

According to Iranian and regional media reports, the USD 120 million investment represents India’s direct capital commitment toward the development of port infrastructure under a long-term cooperation framework with Iran’s Ports and Maritime Organisation. Iranian officials have stated that the investment has been fully realised, with Indian entities actively participating in port operations and the procurement of essential equipment. Despite earlier logistical and diplomatic challenges, cooperation at Chabahar has continued as planned.

Strategic Importance of Chabahar Port

Located in Iran’s Sistan-Baluchestan province along the Gulf of Oman, Chabahar Port holds immense strategic and commercial value. For India, the port provides a crucial maritime gateway to Afghanistan and Central Asia while bypassing Pakistan. This direct access significantly enhances India’s ability to engage in regional trade and strengthens supply chain connectivity with landlocked markets.

Role in Regional Connectivity and INSTC

Chabahar Port is a vital component of India’s broader regional connectivity strategy. It plays a key role in strengthening economic engagement with Central Asian nations and expanding India’s participation in the International North-South Transport Corridor (INSTC). The INSTC aims to improve multimodal transport links between South Asia, the Middle East, and Eurasia, reducing transit time and logistics costs for cross-border trade.

Geopolitical Challenges and Sanctions Concerns

The Chabahar project has faced geopolitical headwinds in recent years. In September 2025, the United States announced the withdrawal of special sanctions relief that had previously allowed Indian entities to operate at the port without sanctions exposure. This move raised concerns over future investments, operational flexibility, and financial transactions related to the project.

Despite External Pressures, Strategic Commitment Continues

Despite these challenges, officials in both New Delhi and Tehran have reiterated that Chabahar remains central to their strategic and economic partnership. With India’s USD 120 million investment now formally affirmed, the port is expected to continue evolving as a regional transit hub. Its growing role in linking South Asia with Central Asia and beyond underscores Chabahar’s long-term importance in regional trade, connectivity, and geopolitical strategy.