Iran and India signed on Monday a 10-year contract to develop and operate the Iranian port of Chabahar, located at the mouth of the Gulf of Oman.

The contract is a further step to strengthen ties between both countries. It came as Washington has warned of potential sanctions for any country considering business deals with Iran.

On Tuesday, Iranian Foreign Minister Hossein Amir-Abdollahian held talks with Indian Minister of Ports, Shipping and Waterways Sarbananda Sonowal, who is visiting Tehran to sign the new contract.

Abdollahian emphasized that Tehran views its relationship with India as strategic, stressing that it was keen on reaching long-term cooperation with New Delhi, reported Iran’s state-run IRNA news agency.

“Our approach to relations with India is strategic and we are ready to further expand our cooperation with India in bilateral and multilateral capacities and within the framework of BRICS and Shanghai Cooperation Organization,” the top Iranian diplomat said.

Abdollahian also termed the recent agreement between the two states as a very important opportunity to expand the volume of trade relations, according to IRNA.

India has been developing the port in Chabahar as a way to transport goods to Iran, Afghanistan and central Asian countries, bypassing the port of Karachi and Gwadar in its rival Pakistan.

US sanctions on Iran, however, slowed the port’s development.

“Chabahar Port’s significance transcends its role as a mere conduit between India and Iran; it serves as a vital trade artery connecting India with Afghanistan and Central Asian Countries,” Sonowal said after the signing of the agreement.

US State Department deputy spokesperson Vedant Patel, asked about the deal, told reporters that US sanctions on Iran remain in place and warned that Washington will continue to enforce them.

“Any entity, anyone considering business deals with Iran – they need to be aware of the potential risks that they are opening themselves up to and the potential risk of sanctions,” Patel said.

The long-term deal was signed between Indian Ports Global Limited (IPGL) and the Port & Maritime Organization of Iran.

Under the agreement, IPGL will invest about $120 million while there will be an additional $250 million in financing, bringing the contract’s value to $370 million, said Iranian Minister of Roads and Urban Development Mehrdad Bazrpash.

Source » aawsat