Tour report accompanying the INSTC delegation from India (MashhadSarakhs-Gorgan-Incheh Boron)

(5-9th Jan 2015)

The delegation from India to study and popularise the INSTC was headed by
Dr.
Guruprasad Mohapatra, (GM) Joint secretary, Ministry of Commerce, Govt. of India and
accompanied by Mr. C Ramkumar, US (ERS), Mr. Shankar Shinde and Mr. Sohel Kazani,
representatives from Federation of Freight Forwarders of India (FF). The INSTC delegation
was accompanied by embassy officials headed by Mr. Yogeshwar Sangwan, DCM, Mr.
Rohitkumar Vadhwana, Second Secretary (PIC) and Mr. Cherakung Zeliang, Third Secretary
(Pol &Com).
Ambassador of India to Iran H.E. Shri. D.P.Srivastava (AMB) accompanied by
Mr.
Sushmit Biswas, Counsellor (E & C) joined the delegation in Gorgan enroute to Incheh
boron.
The highlights of the visit are as follows:
1.
2.
3.
4.

Meeting with H.E. Mr. Ashoori (AH) , Dy. IRI Railways in Tehran
Meeting with officials in Sarakhs Border Terminal
Meeting with officials in Gorgan and Incheh Boron
Wrap up meeting in Indian Embassy with H.E. Mr.Ashoori (AH) & officials

1.

Meeting with H.E Mr. Ashoori (AH) , Dy IRI Railways (5th Jan 2015)

The meeting was conducted in the railway building and chaired by Mr. Ashoori Dy,
IRI railways .The salient points of the discussion are as below.
a) AH welcomed the delegation and informed that various representatives from
departments of transport like road, rail, shipping, customs, border terminal, pmo etc
and counsellor (E&C) of Iranian embassy in Delhi were present in the meeting which
highlighted the importance the government is placing on the INSTC corridor.
b) GM expressed thanks for the meeting and stated that placing importance to the
INSTC corridor a dry run was conducted few months back and the purpose of the
current visit was to discuss the various aspects of the corridor with various
organisations of the Iran government, the results of the dry run and various steps to
take forward and popularise the INSTC. FF (sohel) gave a presentation of the dry run
and stated that two containers were scheduled from India to Bandar abbas to
astarakhan however one container which was scheduled by train from Bandar abbas to
Amir Abad was taken by road thus some difficulties which were faced were
presented. The main points of presentation included
a. Highlights of the dry run including problems faced:- some of the
problems faced included no direct vessel from India at regular intervals, rail
freights not competitive to the road freights, cost of handling at Bandar abbas
has increased due to privatisation
b. Way forward for INSTC: - Direct sailing services. Presently Bandar abbas
being at shorter distance is costing $ 659 as compared to $ 250 for Dubai. Role
for india:commerce ministry signing on international conventions of TIR and
COTIF, streamlining the banking imbalance, shipping ministry-start direct
shipping service from Mumbai to Bandar abbas

c. Developments of the dry run: - Russia showing keen interest in

developing trade in perishables, simatec has started direct services from JNPT
to Bandar abbas at $ 306 per 20 ft container.
c) AH took up two issues of rate and sailing time and started by saying that last year
the chiefs of Iranian, Turkmenistan, Uzbekistan met and the subject was transiting
cotton from Uzbekistan to Bandar abbas and that five years before they were facing a
reduction in this route owing to different problems like financial sanctions, tariffs, etc
and that they were trying to meet each of the single problems last year and the result
was that in 2014 they witnessed 144% development. AH explained how they
addressed the problems so that same process can be followed in the instc case too.
The time of transportation from sarakhs to Bandar abbas (1670km) is 7 days by rail.
They tried to reduce this time from 7 days to 3 days and after they tried to do the same
for other goods. Next was tariffs, because the commodity started from Uzbekistan to
Iran through Turkmenistan, they agreed to give a 30 % discount in all countries. In the
insurance cases they tried to reduce foreign companies with Iranian companies. The
next issue was transferring of money which they settled. AH stated that there are no
arrears with foreign companies despite the difficult conditions of sanctions. He ended
by saying that if there is any problem besides tariffs and sailing time they would
strongly address them
d) PMO also made remarks on some of the maritime issues mentioned. He
mentioned about Simatech starting a direct shipping line and said that other
companies can also start and that they had no problems in that regard. He said that
direct line would reduce costs and enquired about the operations issue. FF clarified
that they wanted to have representive offices in Iran so that they can better understand
the costs, market etc. PMO replied that they had no problem about forwarders
opening offices in Iran. FF mentioned that they would like the PMO to consider for
direct from ship to rail to which PMO responded that its there in Bandar abbas which
was negated by FF.
e) GM enquired about the missing link of 167 km from astarakhan and whether any
plans to develop it and when. AH stated that the Qazvin - Rasht - Astara route is
under construction and that it would be finished by 2015 however the Rasht Astara
has not been seriously started. AH said that two months ago they had a meeting with
Russia, Azerbaijan for a MoU to construct the Rasht section and simultaneously with
the start of the project Azerbaijan has also committed to start its link up to the border
and that there is a bridge. In that meeting it was decided that in six months period they
would take all clearances from their respective governments and their proposal for the
route is to transfer container from Bandar abbas to Rasht and from Rasht onwards to
which FF replied that it was a bit expensive. AH said that it can be studied and that
its like a multimodal transportation.
f) PMO stated that the tariffs are determined by the PMO and it is implemented by
the port operators hence PMO controls and supervise the tariffs and also the duration
for loading and discharging of containers. He stated that provided that the documents
are fully ready it would take a maximum of two days .PMO asked from the Indian
side that in order to increase the trade India should convey the type of goods, products
in order for them to be aware. Currently Bandar abbas is 24 hectares, 2400 more acres
will also be added. The current capacity of the port is 100 MT and last year operation
was 90 MT. The transit capacity for Rajaei port is 20 MT.

g) A person from the Iranian delegation stated that registering of companies in Iran
is not difficult because whether in Iran or India representatives are there and all the
information regarding the ports can be transferred by the representatives. Most of the
Iranian companies are ready to start JV with Indian companies therefore all
cooperation regarding giving representatives would be done.
h) An Iranian official mentioned that within INSTC there are 14 countries with India
and Oman located in the southern part and hence to make the INSTC successful the
countries in the southern part should be more active because the countries in the
northern part are already part of TRANSECA and other conventions. In order for
Oman to be more active there is a quad agreement Iran, Oman Turkmenistan and
Uzbekistan (Ashgabat transit agreement). The delay in the previous visit was due to
one container and the schedule time of the trains could not be arranged. Therefore by
increasing the no. of containers the sailing time would be more and more accurate.
i) An official stated that in the presentation it was mentioned that there were no
defined tariffs but fluctuating tariffs which had not been conveyed correctly to the
Indian side. All the tariffs which are defined officially are exactly conveyed to the
foreign sides but the freight costs will depend on different issues. He disagreed with
the mention that sanctions against Iran had made companies to increase the freight
costs and added that the issues include the destination of the trucks and the demand
and supply.
j) A representative from customs side mentioned two issues 1) EDI (electronic data
interchange) 2) loading and discharging. He said if there is demand, facility will be
provided for the same. Within last nine months almost 9 MT of transit in cargo
Bandar abbas port of entry. The facilities in Bandar Abbas are much developed and as
the customs administration handling the customs facilities they were ready to do
anything to facilitate trade. Electronic system is there and now getting linked with
their organisations to implement EDI. Thus if the in rail the transit from south to north
is more than what is imagined than they would try to increase the capacity.
k) The Iranian side said that they were thankful that visa case were being solved
case by case however in Iranian case within three to four days that they get reference
from Iranian embassy, they give within a day but that is not possible from the Indian
side. And added that they would require some assurance that within ten days it can be
issued. Rohit said that if there is a letter from Tehran chamber of commerce, visas are
issued within a week and moreover the requirement of biometric process needs to be
followed.
l) Counsellor (E&C) from Iran embassy said that he would like to request both
India and Iran freight forwarders to convey their problems by email. He said that
before coming from India, problem of visa was raised. He concurred that embassy of
India had no authority over the biometric exemption.
m) Rohit enquired about Iranian companies giving insurance and how the foreigners
pay to the insurance companies, the present procedure for that, also about the cargo
from Bandar abbas, the break up by rail and road. AH stated that it is not concerned
with the meeting and the important thing was that transactions were done. Regarding
the cargo he said details would be provided.

n) FF (Shinde) said that transport association in Russia had difficulties getting the
trucks plying through Iran; they were not willing to come to Bandar abbas and asked
if that can be looked into. Sanctions do not affect the tariffs but volume and volume
affect the tariffs. He added that the liability is very less when the communication is
there. Rates come with validity of one and two months but shipments take place after
three or four months.
o) GM mentioned about the proposed conferences in India (Mumbai) of
stakeholders meeting and the Secretariat conference and requested the Iranian side to
send their participation.
p) AH thanked both members present and expressed hope that the meeting would
expand relations between the two countries.
2.

Visit to Sarakhs rail border and discussions with rail authorities there (6th Jan 2015)

The meeting was held with Mr. Abdul Karim Zadeh (AKZ) Head of Sarakhs Terminal.
a) He started by explaining the statistics of performance of Khorasan related to
transportation. The total cargo transportation during nine months of present Iranian
year was 4.015MT as compared to 3.019 MT last year which was a 32% increase. The
sum of the transportation in borders in Sarakhs during the nine months was 41,000
trucks .The weight was 1.084MT tonnes. Compared to same period last year the
number of wagons had a 59% increase, regarding the weight 68% increase. Sum of
cargo transit was 8356 wagons, weights 321,000 tonnes compared to same period last
yr 20 % increase, 11% regarding cargo tonnage increase.
b) Regarding the destination of the cargo to other countries Turkmenistan was
103000 tonnes with 32% increase; Tajikistan had 38,000 tonnes with 12% increase,
Uzbekistan 173000 tonnes with 50% increase, Kazakhstan 11000 tonnes with 4%
increase, Kyrgyzstan 4000 tonnes with 1% increase. The incoming traffic is 175,000
tonne which had 9% increase. The main product of transit at this period cotton, fuel,
container. Export transit 146000 tonnes during the nine months. Changing of boogies
started from 9 years ago. The lines in the Sarakhs station is 75 km, nine years ago it
was 25 km they have increased to 75km now. They have the single window to process
all the services which are done during the 24 hours and now are operating the station
with 30 % of capacity .We can add 70% of the capacity. From Bandar Abbas to
sarakhs they can operate and process during 52 hrs and stated that they dont have any
problems to give the services during 24 hrs.
c) GM enquired whether any Indian cargo was coming from India to Bandar Abbas
to Sarakhs. They replied that it is there but not too much and do not have specific
details. GM asked about statistics for last month, about incoming cargo to Sarakhs
from India? Most likely no cargo from India in the last month but they can check for
the last year and if there they can share it with Indian embassy.
d) FF(Sohel) said that they had report of an India company mostly a fertilizer
company who wanted to import Potash from Uzbekistan via rail to Bandar Abbas to
India but it had problems and was not successful. They asked whether the Indian side
had any specific report but no report just an article to find out the problem related to
the transit, though it does not mention Sarakhs. AKZ replied that maybe they have
limitation in capacity. Changing 100 bogies in Turkmenistan. The capacity is 50:50.

Right now 75 a day because it is near to Christmas, from Iranian side, and
Turkmenistan 50 wagons a day. He said that they can operate 400 bogies a day but
right now they dont have any wagons. They are operating 30% of the capacity.

e) Rohit enquired that there is waiting period of trucks and non-utilisation of rail.
From the one side trucks are waiting and from the other side only 30% is being used,
what is the reason? The Iranian side replied that the forwarders decide which way to
choose and which is the convenient route for them .If they transfer all the traffic from
the truck to rail they could operate with 40% but there are limitations to carry by truck
of tonnage. Another reason is lack of knowledge of forwarders about the commissions
in Sarakhs. He mentioned that recently they had increased the speed of operating the
wagons, immediately they can go out. These were the facilities that the forwarders do
not have knowledge.
3.

Meeting with the officials at Gorgan and Incheh Boron. (7-8th Jan 2015)

i)

Meeting in Gorgan

The officials were Mr. Mohammad Qharavi, Member of Railway Board (MQ), Mr.
Maghdari, Dy. of planning of Golestan province, Mr.Kashani, General Director of
Economics of Golestan province.
a) MQ introduced the Iranian officials as well as introduced the INSTC delegation,
explaining the purpose of the visit to the officials. MQ started the discussion by
emphasising the capability of Iranian rail regarding the facilities, equipment, and
infrastructure on international standards. The route from Incheh boron to Bandar
Abbas has the capacity of 3MT and said that they can increase the capacity to 10MT.
He said that the study under electrical rail was done by Russian side and now was
under final phase now they are discussing and in near future it would be implemented.
He mentioned that some factors were very important in transit which included the
scheduled train or block train. He said that they have Incheh Boron to Bandar Abbas
estimated at four days also for Amir Abbad, same number of days.
b) AMB queried whether the 4 days was just for transit or including other
procedures like customs etc. MQ replied that its just for transportation. He added that
it is the most economic route and the shortest. He expressed readiness to cooperate
with Indian freight forwarders. He added that the first cargo of 12,000 tonnes of wheat
from Turkmenistan was arriving Incheh boron (the first after its inauguration) the next
day and expressed hope that the Indian delegation may be able to witness the arrival.
c) AMB asked how much time it takes by road. MQ replied that it was almost the
same, does not take much time, from Sarakhs to Bandar Abbas 1619km. He expressed
the seriousness of the Iranian government and said that in case there are lapses there
could be penalties imposed on the rail authorities.
d) FF expressed thanks for the information and mentioned about the issue of
gradient/slope in rail which was delaying the transit by 3 to 4 day that was why it is
preferably moved by road and also mentioned the second issue that if moving transit
via Turkmenistan who would be responsible for transit to Turkmenistan clearance for
the railway like customs etc because agents will be in Russia and they do not have

access to Turkmenistan and enquired about how to tackle this issue. The second issue
was about the loaded containers which are transported to Russia and how to get back
the empty containers to Bandar Abbas. Whether Iran government has any tariffs for
empty containers or is it free. He added that while the new route is competing with the
traditional route which is from Nhava Sheva to St.Petersburg which is 30 days with a
freight of $1000 per twenty feet tonne.
e) MQ replied that technical details can be answered in the technical meeting
however he said that regarding the question who is responsible for the cargo the
freight forwarders has good contacts in Turkmenistan and they can help you and that
these were routine issues. Regarding the empty containers the forwarders are
committed and they have to send back the empty containers.
f) GM asked for the list of Freight forwarders, wagon owners and freight forwarders
and explained about the dry run to Amir Abbad and Astara to study the possibilities of
the route.
g) AMB suggested that inorder to reach a working solution whether the Indian
delegation could meet the wagon owners. The Iranian side replied that the meeting
would be only with the freight forwarders since they were not informed earlier and
suggested that the Indian freight forwarders and freight forwarders in Iran can meet
and discuss the details.
h) The Iranian side mentioned that they have MoU on protocol with Turkmenistan.
Kazakhstan. Earlier they sent 200 empty wagons from Turkmenistan, they come
everyday, for example when he checks his mobile phone, 50 from Uzbekistan , 50
from Kazakhstan , the responsibility of wagons are with them and according to the
latest statistics they had exchanged 8000 wagons till now just empty containers .
ii)

Meeting in Incheh Boron with freight forwarders

Mr. Abdul Samed Ahmenijad (AS) representative from Gorgan Chamber of

Commerce
a) The Iranian side welcomed the Indian delegation and mentioned the presence of
one international rail forwarder (Ali Nazari) and three or four road forwarders . He
mentioned that there are agents here who can handle efforts in CIS countries and have
the capabilities to handle the cargo from Mumbai to Russia.
b) AS welcomed the delegation and said that there are 18 international road
companies in Golestan with lots of capabilities. He mentioned that rail forwarders
currently dont have operations and the first cargo would be coming but regarding
road forwarders they have been working since 1991 and active with CIS countries and
the products include apples, cement and also iron ore to Turkmenistan
c) FF queried whether for booking of cargo they liaise with private wagon owners
individually or carriers in terms of rail cargo. AN replied that it is on a case by case
basis depending on the cargo
d) The Iranian side mentioned that the rail can carry a lot of amount and regarding
wagons he stated that in different times and occasions they may have had restrictions

for instance if want to carry iron stone you are supposed to carry by the tall wagon
however we can carry all of them...this is based on the protocol between Iran and CIS
countries. They said that discount would be given as per the amount of cargo.
e) FF asked about the cost, time and distance from Incheh boron to Moscow and if
any special care need to be taken in the route. Iranian side replied that from Mumbai
to Moscow approx. 30 days and in terms of costs and other details it can be provided
and at the moment no foreseeable problem. They stated that there is table of prices
based on MTT, international policy between CIS countries. The policy of tariff is a
stable and fixed policy and policy is the same as other country we are the OSJD
countries, 15 countries, base of the tariff is MTT, all of them accept and agreed, 2.1
cent- Iran, Turkmenistan- 2.54 cents, Kazakhs-2.85 cent for every ton km.
4.

Wrap up meeting in Embassy of India (9th Jan 2015)

Meeting was held with H.E. Ashoori , Dy, IRI railways and three other officials
a) AMB welcomed the Iranians and thanked them for the courtesies extended
to the delegation. AMB underlined the importance of the INSTC project and the
mutual interest of both the countries which would also give India access to CIS
countries and Russia while at the same time underlining the centrality and
location of Iran which could be counter to the new silk route initiative of the
Americans .It is a choice between the old existing route between India and
Russia and a new route which still does not exist for which tangible benefits have
to offered to the exporters so the Indian side has to know and tell the Indian
exporters that they will save money and save time. They had mentioned that the
existing route from India- St.Petersburg takes $ 1000 for a twenty foot containers
and thirty days. The new route has to be cheaper and shorter in time.
b) GM expressed thanks and gratitude to the Iranians for their hospitality and
for all the cooperation. GM stressed that INSTC is an important route and he
assured the Iranian officials that Govt.of India attaches great importance to
INSTC. And to the centrality of Iran. Though the agreement had been signed in
2000 it is the right time to take it forward. In recent meeting with the Russians it
was found that they also were also keen and interested in the INSTC and
transport minister in Russia expressed interest to the Amb of India to attend the
conference on INSTC in Mumbai. GM said that currently there are two routes
for trade between the two countries. One is the sea route from Mumbai to
St.Petersburg and movement to other countries which is $6 billion which is low
considering the size between India and Russia. Putin visited India and it was
decided that trade between India and Russia should reach $ 30billion in 2025.
The other route is through Bandar Abbas by railways to other countries, the
major problem why trade between India and Russia is not rising is because of the
transportation.
c) GM said that through the freight forwarders associations of India a dry run
was conducted it was found that four routes could be used. One is India to
Bandar Abbas by sea and from Bandar Abbas to Caspian Sea (Amir Abbad) by
road and from there by ship to cis countries. The other routes are India to Bandar
abbas by ship and Bandar Abbas to Amir Abbad by rail. The third route is India
to Bandar abbas by ship and Bandar abbas to Incheh Boron by rail and from

Incheh boron to other countries and the fourth route India to Bandar abbas and
Bandar to Baku by road and Baku by rail to Moscow. All four movements major
part passes through Iran which requires tremendous cooperation between railway
authorities in Iran, road authority in Iran. In all the four routes there is a savings
in time vis a vis the old route but currently the difference in costs is not so
impressive which require for the consultations with shipping agents , freight
forwarders and the help and cooperation of the railway authorities particularly in
this .
d) GM proposed to do three things in future. 1) Memorandum of understanding
is proposed to be signed between railway and India. Wording is quite appropriate
but as a rule to get the approval of government of India most likely within 8 10
days the new agreement can be signed. A draft MoU as approved by India would
be sent to Iranian authorities and once acceptable to Iran, the MoU would be
signed and sent to Iran for signature too. The MoU would be concluded
definitely by the end of this month. 2) Proposal to hold a conference in Mumbai
in the second week of February. The conference would be to discuss all
operational issues related to INSTC. Participation requested from railway
authorities including freight forwarders, shipping agents etc to this conference as
also the support of the Embassy of India, Tehran. 3) There would be certain
agreements required between different governments of INSTC route hence to
immediately write to Iranian govt for the conference. This conference will be
held in end of Feb or March as per the convenience of the countries. GM said
that activities are proposed to be started by this year itself. The first conference
would be stakeholders conference and second is the secretariat/INSTC council
conference.
e) AH thanked the AMB for preparing the ground for the meeting and stated
that when he saw the pictures of Gandhi and Nehru he thought that when two
persons decided to save the country they can do that and they could motivate the
millions of people. Likewise if two sides want to do something seriously they
can do that. He mentioned about meetings between India and Iran five years ago
to study bout INSTC the difference from that time to this time is that two sides
has a serious will to implement the cooperation and to use the equipments in this
route. He stated that during the last years a lot of meetings were held with the
officials of Russia, Kazakhstan, Uzbekistan, and Azerbaijan. He said that an
agreement with Russian railways officials to make the joint venture to make the
railways electrical. He said that with some countries the volume of cooperation
increased which was mentioned in the last meeting for eg. cotton cargo from
Uzbek during the year compared to the last year 144 % increase for transiting
from Uzbekistan.
f) AH expressed hope that the two sides have serious will and said that the
forwarders play a major role. The govt and railways can just hold the meeting
and prepare the ground. He suggested the meeting of Iranian forwarders and
India forwarders and said that they can introduce seven or eight international
transportation forwarders who can work in Iran. The MoU draft can be studied
today and if there is any revision or changes it could be done during the meeting.
g) GM said that the forwarders can be called during the conference for which
ten slots will be reserved for the Iranians out of the total of 50 slots including

Russian, Iranians etc. AH said that during the conference the Indian and Iranian
forwarders can discuss the specifics. He said that there are 400 forwarders in Iran
but majority of them their work volume is low and big forwarders may be less
than 10.
h) GM said that top five can be taken, from railways, roads etc. FF said that
they had been asking details with regard to the system of rail and forwarders
association for integration of tariffs. Also why the tariffs are in chf (Swiss francs)
by adding that rial or dirham is preferable also the need to understand the
remittance to forwarders to handle, packing. Another purpose of the meeting is to
understand the problems in CIS countries since they seem to have more
problems. what is the reason it is moving by road and not by rail.
i) AH gave the explanation about time and tariff. Iran is member of two
international agreements OSJD and OTIF and the rates are announced based on
the cooperation with these two agreements. Table of rates available in the
website of railways. The only thing can be changed is the discount that the
railways gives .This discounts are allocated to the forwarders or owner of cargo
provided that the volume of cargo should be clear . For e.g. the cotton cargo from
Uzbek, the contract between Iran and Uzbek. 400,000 tonnes of cotton. The
discount is step by step discount ... for example if 50,000 tonnes is transited, 5%
discount, if 100,000 tonnes is transited, 10% discount. If the rate reaches the
400,000 tonnes, 30% discount. However if again the amount reduces, discount
reduces accordingly. Thus the volume of cargo should be clear and announce to
us and after that a clear model can be proposed to you. Moreover there are other
costs like import, export etc. Regarding questions about Swiss franc, it has more
to do with the exchange rate fluctuation because dollar and euro had lots of
fluctuations in recent years and Swiss franc is stable however it can be mutually
agreed by agreement provided that the time of the contract should be very short
because recently the Russian rouble was reduced and lots of companies which
carried the cargo to Russia were faced with a lot of problems. The rate is based
on the Swiss franc but the base of exchanging the foreign currency can be
decided based on the agreement. Regarding the time of transit the railways is
ready to give a schedule of trains to reduce time of transitory just because two
sides decides to do this seriously week can just tackle the issues between the
operational issues.
j) AH enquired about the type of cargo to which Indian side replied that all
types including container and the cargo for transit would include soyabeanmeal,
rice, pharmaceuticals also probability of moving to others like potatoes , onions
etc.
k) FF enquired about the tariffs and whether the tariffs included all costs and
also whether the wagon owners employ private locomotives, wagons, AH replied
that it includes all costs however there are other costs in import and export for
e.g. in sarakhs and incheh boron changing of boogie it has another costs like if
cargo is sent to turkey there is no changing of boogies and the costs will be
reduced.
l) AMB enquired about Iranian plans regarding Chabahar and Railways from
Chabahar - Zahedan there is a gap, whether contract already awarded, value of

contract, capacity of railways in the sector for instance Incheh boron Bandar
sector 5000 tonne, status of rail building in Herat province, Iran being a member
of ECO what are ECO plans to build either rail or road from
Chabahar. ? AH replied that Chabahar railway connectivity was not a priority for
the previous years because Bandar Abbas rail to CIS countries is there but that
during the last ten years India is very interested in this route. He said that he
could not understand Indias interest in Chabahar. Five or six years ago the MoU
was signed between Iran and China to develop the Chabahar but the MoU was
not implemented. The Iranian president visited Chabahar in last couple of
months and for second time visited Chabahar in last month and the president put
emphasis about connecting Chabahar to railway. To implement and fulfil the
project of 600 km needs a huge amount of capital. He said they are expecting and
waiting for the approval of majles because it studies budget bill of the next year
and in the next two months it will be clear how much is sanctioned for Chabahar.
m) AH added that they have 9000 km railway under construction now and some
of them is more important priority for e.g. the project between Qazvin and Rasht
is a very important part and also the project between sangan, khaft and Herat or
the project between miyane and Tabriz. There are old routes but they want to
make it shorter and other project is arak and it goes through Iraq but the project
between Chabahar and Zahedan is not among the most important project. Only
with the emphasis of the President, the project has gained priority. During the
next six months they can reach the Afghanistan border though the continuation in
Afghanistan territory should be made by the cooperation of Afghanistan. Another
project from Mashhad to Gorgan if this part will be made it can come directly to
this point. ...distance .around 700-800 km.
n) AH enquired whether there is any railway connection between India and
Afghanistan? And the most important cargo which India wants to bring from
Afghanistan? AMB replied that last time 1MT of wheat was given to
Afghanistan and most of it went through Pakistan and some of went in the form
of biscuits to Iran.
o) AH replied that Iran also has a rail connection with Pakistan and asked again
why India is emphasizing on Chabahar. AMBclarified by explaining that it is not
only India who is interested but also Iran. Chabahar was offered to India during
Khatamis visit in 2003 and the Iranian Dy minister showed a map to Indias
foreign secretary and he showed that all the roads and bridges built by Americans
in Afghanistan after 2001 were going eastward trying to integrate afghan
economy towards Pakistan thats why Iran offered Chabahar project to India.
This was much closer and if the railroad is also developed this would also
strengthen Irans position within Afghanistan, right now most of the transit trade
to Afghanistan (around 80%) is controlled by Pakistan, its only 20-25% thats
going through Iran.
p) AH stated that during the last month he had discussion with Afghanistan
head of railways and they are interested to implement the project. The Herat
region has lots of iron ore mines and they want to export the iron ore .He added
that during last four or five months the president and minister emphasised this
project to be implemented very soon. From Incheh to Russia is 400 km is less
compared to the sarakhs border.

q) To a query of AMB about rail and road comparison AH said that this ought
to be answered by the forwarders who would have the details. He said that the
railways have fixed rate during a one year contract but the road transit rate
differs according to the season. Moreover there is less time commitment in
roadways unlike the railways where the timings are clear. He added that for huge
amount of cargo the railways has more privileges but for low amount of cargo
road may be used. Normally the minimum threshold in railways is 100,000
tonnes.
r) AMB enquired about ECO, the connection with Pakistan whether cargo or
passenger or both. AH replied that he doesnt have info on ECO and the
connection with Pakistan is both. There is a passenger train each fifteen days
from Pakistan and for cargo no fixed day and added that the volume of cargo is
not much and most of the cargo from Turkey.
s) FF requested information of the details of the operators, twenty nine private
wagon owners. AH said that two discussions are there, carrier and forwarders. In
carriers 21 owners out of twenty just two of them are involved in international
affairs ...rest do local. The main parties for forwarders they are using the wagons
of the carriers.
t) FF enquired about the system of monitoring of amount of imports to the
area. AH replied that the road system has own monitoring system and railways
has own monitoring but no common place to see both information.
u) AMB suggested that in the draft MoU Indian goods which will be transited
through Iran should receive national treatment in terms of customs etc and if
agreed that can be included in the draft MoU. AH said that they have two
policies. 1) Sign the MoU in the level of high ranking officials of the country for
e.g. two ministers can sign the MoU and 2) the MoU can be signed by the
executive. GM replied that it will be signed at the level of officials.