India is looking to start operations at the Chabahar Port in Iran by 2018, according to the country’s Ministry of Shipping.

The Minister for Road Transport & Highways and Shipping Shri Nitin Gadkari informed that the development project at the Chabahar Port has already started with civil construction work. Once completed, the upgraded port is set to boost trade and business between the two countries and in the region.

The Indian Government has allocated INR 6 billion (USD 94.1 million) for the development of the port. Out of this, tenders worth INR 3.8 bilion (USD 59.6 million) for equipment have already been finalized.

India and Iran entered into a Memorandum of Understanding (MOU) to develop the Chabahar Port, located outside the Persian Gulf, in May 2016.

Under the deal, India is to equip and operate two berths in Chabahar Port Phase-I with a capital investment of USD 85.21 million and annual revenue expenditure of USD 22.95 million on a 10-year lease.