India Ports Global's first project is development and operation of Chabahar Port in Iran
The government has allowed Jawaharlal Nehru Port Trust (JNPT) and Kandla Port Trust (KPT) to go ahead and build and operate ports overseas. A new company, India Ports Global Ltd (IPG), will be jointly held by the two ports.
The board comprises three members – chairman of JNPT, chairman of KPT and an additional secretary from the central government. The present paid-up capital of IPG is Rs 5 crore.
The first board meeting of IPG was held on February 12. Its first project will be development and operation of a port at Chabahar in Iran.
Chabahar is the capital of Chah Bahar county in the province of Baluchistan. It is currently a free port, and is sparsely populated (estimated population is just a wee bit over 71,000). It has already been designated as a Free Trade and Industrial Zone by the Iranian government, and has strategic significance for international trade as it is located at the southernmost tip of Iran, and at the mouth of the Strait of Hormuz, which leads to the Persian Gulf connecting UAE, Saudi Arabia and Iraq.
It is an all-weather port, which is possibly why it was named Chabahar ('char' is Persian word for four, and 'bahar' for spring, thus meaning spring-time all round the year). The building of a modern port at this location will cost around Rs 5,000 crore and could be ready in about three years. Financing for this project could be by the way of bonds and commercial loans. IPG is said to be willing to look at investments from private investors as well, both from India and from Iran.
Chabahar is of tremendous strategic significance for another reason as well. It is almost next to Pakistan's Gwadar port which is just 555 km by road, and 76 nautical miles away by sea. Gwadar is being developed by China, and India's presence in Chabahar gives it an enormous strategic edge because of the oil business that Iran offers, as well as on account of its easy access to the Middle East and Afghanistan.
Chabahar is also connected by a multimodal transportation network. It has an airport with flights to Tehran, Zahedan, Mashdad, Shiraz and Bandar Abbas. It is also connected by air to Doha, Dubai and Muscat. It is connected by two national road networks and is also to be joined by a multi-billion dollar railway project (Iran's Eastern Corridor) which will connect Chabahar to Central Asia, Afghanistan and Central Iran. A 900 km railway line connecting Chabahar to the mineral rich Hajigak region of Afghanistan is already being undertaken by India. Thus, the India-aided railway line will have synergies with the India-developed Chabahar port.
Some other projects the newly formed IPG will be looking at are building ports in Bangladesh, Myanmar and Sri Lanka. Discussions with these countries are said to have commenced. China is already in the process of developing ports in Myanmar and Sri Lanka, and if IPG also develops other ports in these countries, it would be a major development offering both commercial and strategic advantages to India.
JNPT chairman NN Kumar to step down
N N Kumar, chairman of JNPT, who completed his five-year stint by February-end, is stepping down. He has been promoted to the rank of additional secretary, and will revert to his home cadre -- the Indian Revenue Service. JNPT's fourth terminal as well as the special economic zone were cleared during his tenure.
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