Iranian firm eyes tie-ups in India for transit corridor

Monday, 27 January 2003, 08:00 Hrs
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NEW DELHI: An Iranian port company set up to help develop a transport corridor linking Iran, Russia and India is eyeing tie-ups in India to boost container traffic on the route.

"We are looking at supply of steel scrap and raw cotton from Central Asian countries to India and other markets," Y. Davoodi, commercial manager of Kaveh Port and Marine Services (KMS), told IANS here.

Part of a visiting Iranian business delegation comprising 65 companies, KMS is primarily focusing on promoting the multi-modal North-South Transport Corridor, also known as NORSTRAC.

The route links Mumbai in India with Iran's Bandar Abbas port. From there it is linked by rail and road to the northern Iran ports of Anzali and Amirabad on the Caspian Sea.

A sea link from there goes to the Russian ports of Astrakhan and Lagan. It is estimated to be around 40 percent cheaper than the sea route from India to Russia and Central Asia because it takes 15 days less time.

KMS has been investing in building port handling facilities along the corridor for container movement. It has set up handling stations at Jebel Ali Port in Dubai and Turkmenbashi in Turkmenistan.

While traffic on the route to Russian ports has been picking up over the years, the promoters have been mulling ways to increase the flow of goods in the opposite direction in which containers generally return empty for more economy.

"We see a good market in India for supply of around 100,000 tonnes steel scrap per annum from Turkmenistan and Kazakhstan, where it is plentifully available from abandoned Russian plants. We are also studying a proposal for supply of raw cotton from Central Asia to India and other markets," said Davoodi.

In the case of raw cotton, KMS sees potential for handling around two million tonnes per annum headed from Central Asia to the South Asian markets.

To facilitate greater flow of goods from the Commonwealth of Independent States (CIS) in Central Asia, Davoodi said KMS was in talks with two Russian companies -- Volga-Vaster and North Caspian Shipping Company -- to form a joint venture for port handling facilities in Russia.

"We hope to finalise the joint venture within two months with the Russian partners holding 51 percent stake and KMS 49 percent. Under this venture we plan to set up cargo and container terminals in Russia," said Davoodi.

"Recently we signed a memorandum of understanding with Astrakhan Oblast Administration to set up cargo and container handling terminal at Olya port."

Through another joint venture, Jamrah Transport Company, KMS two months ago started providing door-to-door service to attract more traffic on the transit route.

As the main contractor for the Iranian Port Authority, KMS has set up a cargo and container-handling terminal at Bandar Abbas that clears the bulk of the goods routed through the North-South corridor, whether by road or rail.

"One month ago we won a contract for establishment and operation of general cargo and container cargo handling terminal at Bandar Anzali, which will enable us to handle more varied cargo," said Davoodi.

The Iranian company is planning another general cargo terminal in Bandar Abbas for handling cotton.

In India, KMS has already entered into a memorandum of understanding with Cosmos International to act as its agent on a reciprocal basis.

"We are now looking for tie-ups with major importers and exporters who are keen to do business in the Central Asian and Russian markets. If we get some of the expanding markets on the route, we may look at investing in port handling facilities in India," Davoodi said.

Container movement between India, Iran, Russia and the North European market is currently estimated to be about 4,000 TEUs (20-foot-equivalent units) per month. This is expected to grow manifold once the infrastructure and other customs agreement between India, Iran and Russia are in place for faster movement of goods.

Source: IANS
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