India dropped from Construction of Chabahar-Zahedan Rail Project following Delays in Funding for the Project

The Iran Government has decided to drop India from the construction of the Chabahar Port-Zahedan Railway Line Project and now will be proceeding with the construction of the Project on its own.

This was informed by the Transport and Urban Development Minister of Iran during the inauguration of the Chabahar Port-Zahedan railway track laying process last week.

The Minister has further citied Delay of Funds from India as the reason for dropping off India from the Railway Project. He has further added that the Iranian Railways will be now proceeding with the project that will be completed by March 2022 and the funding of about USD 400 million for the project will be made from the Iranian National Development Fund.

Chabahar Port-Zahedan Rail Line Project

The agreement for the development of the Chabahar Port and for the construction of a 628 Km railway line from Chabahar port to Zahedan (41 Kms from the Tri-point: Border of three countries- Iran, Afghanistan, and Pakistan) was signed as a part of India’s Commitment in development of Trade with Iran and Afghanistan.

This Railway Project if completed by India would have served India an alternative Trade Route with Afghanistan and the Rest of Central Asian Countries.

For the Railway Line Construction, Memorandum of Agreement was signed between the Indian Government’s IRCON International Limited (Indian Railway Construction Limited) and the Iranian Railways during the visit of Prime Minister Narendra Modi to Iran back in 2016.