Not just Iran and India, but Afghanistan too would be hoping that once the conflict ends, the Chabahar Project shall get a boost. Afghanistan’s economy has been suffering due to global sanctions. As a result, the Taliban dispensation has been trying to diversify its economic partnerships and strengthen ties with India.
In a media interview, days before US President Donald Trump announced a two-week ceasefire with Iran on April 7, Iranian Ambassador to India Mohammad Fathali, while highlighting the close ties between India and Iran, also referred to the strategically important Chabahar Port. The development comes amid heightened geopolitical tensions in West Asia that have disrupted regional connectivity and energy flows.
The senior Iranian diplomat said, ‘The Chabahar Port, as a strategic project, plays a key role in strengthening trade and transit links between Iran, India, and the region.’ He also said that the project will ‘expand’ at an even faster pace once the West Asian conflict ends.
PM Narendra Modi has spoken to Iranian President Masoud Pezeshkian on more than one occasion during the West Asia conflict, while External Affairs Minister S Jaishankar has held several conversations, in the midst of the conflict, with his Iranian counterpart Abbas Aregchi.
Indian refiners purchase Iranian oil
It would be pertinent to point out that, amid the West Asia conflict, Indian refiners have also been purchasing oil from Iran. This has happened after a hiatus of seven years. India had stopped buying oil from Iran in May 2019 due to US Sanctions. With a view to ensuring that global oil prices remain stable, the Trump administration waived sanctions on Iranian oil for a month in March.
India’s focus on the Chabahar Port
Despite US strains with Iran, even before the current conflict began on February 28, 2026, India has been attaching immense importance to the Chabahar Port project due to its strategic location – as a gateway to Afghanistan and Central Asia. In May 2024, India signed a 10-year agreement for the development of the Shahid Behesti terminal, which is Phase 1 of the Chabahar Project. A 10-year contract was signed between Indian Ports Global Limited (IPGL) of India and the Port & Maritime Organisation (PMO) of Iran. According to the agreement, India had made a commitment of $370 million to the project.
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Despite tensions between the US and Iran, the former had provided India a six-month sanction waiver in October 2025, which is set to end on April 26, 2026. India had transferred $120 million, which it had committed in the 2024 agreement, before the sanctions ended. In the 2026 budget, no funds were allocated to the project.
According to reports, India is in talks with the US about extending the waiver. The negotiations between Iran and the US are important in this context, as one of Iran’s key conditions for a permanent ceasefire is the removal of all sanctions imposed by the US on Iran.
Chabahar Port and India-Afghanistan trade ties
The Chabahar Port project has been especially important in giving a boost to bilateral economic relations between India and Afghanistan. Trade between India and Afghanistan is estimated at around $1 billion, though both sides believe this is far below its actual potential.
While speaking during his visit to India in November 2025, Afghanistan’s acting Commerce and Industries Minister Alhaj Nooruddin Azizi said: ‘We request the Indian government to help ensure the trade route from Chabahar Port is functional, so that the trade remains competitive’.
India has also transported relief materials to Afghanistan via the Chabahar Port.
Minister of State for External Affairs, Kirti Vardhan Singh, while responding to a question in Lok Sabha in December 2025, commented on the importance of the Chabahar Port in the context of India-Afghanistan ties: ‘Chabahar Port has an important role in supporting Afghanistan’s reconstruction and economic development, including providing humanitarian and other types of emergency assistance to Afghanistan.’
India has also been pushing for the inclusion of the Chabahar Project in the International North South Corridor (INSTC), which will link India with Europe.
While India and Afghanistan have launched air freight corridors linking Kabul with Amritsar and New Delhi, the Chabahar Port is extremely significant in the context of India-Afghanistan trade.
Not just Iran and India, but Afghanistan too would be hoping that once the conflict ends, the Chabahar Project shall get a boost. Afghanistan’s economy has been suffering due to global sanctions, the freezing of $9 billion in overseas funds of its Central Bank, as well as tensions with Pakistan, which led to border closures. As a result, the Taliban dispensation has been trying to diversify its economic partnerships and strengthen ties with India.
Conclusion
In conclusion, the current West Asia crisis has impacted India in several ways; one of the significant impacts has been the Chabahar Port being put on hold. All stakeholders are hoping that the project, which is pivotal from the perspective of regional connectivity, will be back on track once the West Asia conflict is over.
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