Indian Minister: New Delhi Ready to Invest $15 Billion in Iran

On Wednesday, October 1, India's Minister of Transport and Shipping stated that his country is ready to invest $15 billion in Iran, provided that Tehran offers better conditions for New Delhi, including selling cheaper gas. According to a report by Reuters, Nitin Gadkari mentioned that this investment would be in construction projects, including the full development of the Chabahar port. India is one of the few countries that continued its trade relations with Iran during the Western sanctions against Tehran over its nuclear program. New Delhi is the second-largest buyer of Iranian oil after China. In a press conference, the Indian Transport Minister said, "We are ready for extensive investment in Iran, and this largely depends on Iran's proposed price for gas sales... Gas pricing is a fundamental issue." A few days ago, Hassan Rouhani, the President of the Islamic Republic of Iran, urged India to play a more significant role in Iran's infrastructure projects, including the full development of the Chabahar port, ahead of Tehran's historic agreement with six world powers regarding its nuclear program. According to Reuters, New Delhi hopes to make a decision after receiving Iran's latest proposal in early October and reports from other Indian ministers, including those of oil, chemicals, and steel. Chabahar port, located at the southernmost point of Sistan and Baluchestan province, is a vital center in India's efforts to counter its long-time rival Pakistan and serves as a route to Afghanistan, which has close security and economic ties with New Delhi. This port could also be used as a route for trade with oil-rich Central Asian countries. The Indian Transport Minister and Abbas Akhoundi, Iran's Minister of Roads, signed an $85 million contract in May this year to lease two existing docks at Chabahar port, which are intended to be used as multipurpose cargo unloading terminals. India hopes to play a more significant role in Iran's economic projects, especially in the construction of petrochemical units and urea production, following the reduction of sanctions against Tehran. The country seeks to buy each unit (million BTU) of gas from Iran at $1.50, while Tehran has proposed $2.95 for the construction of urea production units. The Indian Transport Minister stated that establishing a urea production unit in Iran and importing it to India would save 800 billion rupees ($12.13 billion) in subsidies and halve the price of this product for Indian farmers. Mr. Gadkari added, "If the gas price becomes reasonable, all Indian government sectors can focus projects in a special economic zone in Iran, and the investment made would exceed one trillion rupees." Currently, 66 Indian rupees equal one US dollar. In this context, India is paying $1.4 billion of its debts to Iran. Bloomberg reported that India is investing $3 billion in Iran's petrochemicals and is ready to pay $700 million of its debts to Iran.