Instability caused by the ongoing war in Gaza and Houthi attacks on ships transiting the Red Sea has put the India-Middle East-Europe Corridor (IMEC) on hold until further notice. India seems to be reassessing its position within international transport routes in this context. Attention is now turned towards an ‘old acquaintance’: the International North-South Transport Corridor (INSTC).
High-level meetings between Iranian and Indian governmental officials this week highlighted India’s re-approach to the INSTC. For various reasons, the country had kept some distance from the corridor for the past few months.
Some of the most important reasons concerned the stagnation of infrastructure projects along the INSTC, slowing down its development, tension between Iran and India regarding the development of the Chabahar port, and, of course, the emergence of a new transport project in which India had a prominent role–the IMEC.
Since its announcement at the G20 Summit in 2023, the IMEC has been widely criticised. One prominent point of criticism concerned its merely geopolitical character, which lacks aspirations for economic integration between the parties involved and a vision for shared investments.
Experts have warned that the project is quite frail since it relies on cooperation between countries whose relations are not the best possible and that it will fail to pose serious competition to China’s BRI or the Russian-led INSTC.
India turns again to Iran and Russia
The ongoing and spreading Middle East crisis confirms those concerns. India is now turning again towards Iran and Russia to explore possibilities of Eurasian transportation. According to Indian media, the three states have been intensively discussing the situation in Gaza and the Red Sea and putting the INSTC at the forefront of alternative shipping solutions.
In fact, the ongoing war has affirmed the importance of INTC for India, which, together with Iran, is already attempting to revive the project. The two states reached an agreement to create a “joint transportation committee to expand cooperation between the two countries and activate the transit capacity and use of the INSTC”.
The Indian Foreign Minister, S. Jaishankar, also expressed “India’s readiness to carry out transport investments in Iran”. Moreover, the two parties have found a new formula for operating the Chabahar port, a critical INSTC hub. A new, ten-year agreement has been signed giving India access to the management of the port’s Shahid Beheshti terminal. The new agreement opens the way for Indian investments, which have been hindered by the short annual management contracts signed until recently.
