Wait, no one likes us anymore? Earlier this week, India took steps towards its quest to reach Central Asian markets. With Afghanistan and Iran in tow, our eastern neighbour announced investments in a number of infrastructure projects under the "Trilateral Transit Agreement" at Chabahar. Unlike India, Pakistan actually shares border with Afghanistan and Iran. But it was nowhere to be found at the party.
Flanked by both Iranian and Afghan Presidents, Indian Prime Minister Narendra Modi announced a $500 million investment for the development of Chabahar Port. There will be additional investment to build road and railway networks to link Iran with Afghanistan. Besides economic deals, India and Iran also signed a dozen bilateral MOU's relating to cultural, academic, and technical exchange.
"Today is an important and historical day of development of relations between the three countries... From Tehran, New Delhi and Kabul, this is a crucial message ... that the path to progress for regional countries goes through joint cooperation and utilising regional opportunities," the Iranian President was quoted as saying at the occasion.
This trade corridor deal must be seen in right context. The port construction at Chabahar is not a new project or solely a response to Gwadar's development under CPEC. Chabahar discussions date back more than a decade. But India grew serious about it only recently, after the West lifted major economic sanctions on Iran. Same for Afghanistan, which needed an alternative to reach the Indian Ocean.
Chabahar is also about India's strategic sourcing. Before the 2011-12 sanctions, Iran used to be India's second-largest oil supplier. India's dependency on Iranian oil will grow again post-sanctions. India is also eyeing supplies of metals and minerals from Afghanistan. In Chabahar, India sees a secure route through which those vital supplies can be shipped. After all, no country wants to self-create a potential choke-point by passing such supplies through unfriendly territory. So, Chabahar makes sense for India.
But Chabahar alone cannot meet all of India's connectivity needs vis-a-vis Central Asian markets. India, of course, can choose to bypass Pakistan completely and ship its goods to far-off terrains in Central Asia via the Chabahar option. But in doing so, it would also bypass good economics.
For instance, using the Chabahar port to ship goods from, say, New Delhi in India, to Ashgabat in Turkmenistan would entail a distance that is roughly twice compared to what it will take when those goods transit through Pakistan. Besides, using Chabahar would make the transport multimodal, adding more time. So, Pakistan seems to have some leverage in regional connectivity, which it can exercise in economic fashion.
Transit via Pakistan may still be an attractive option for our estranged neighbours. But as this agreement shows, that attractiveness could be dimmed if Pakistan doesn't mix its security interests with a bit of economics. Isolating oneself can be good for self-reflection. But in matters of regional trade, there is little salvation in isolation. The Chinese have been telling us that for two decades now. It's time to pay heed.
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