India’s Projects in Central Asia
India's engagement with Central Asia has increased in the last decade. India has emerged as one of the leading countries in the world - both economically and strategically. As a part of its strategic cooperation, the five Central Asian countries have become important partners for New Delhi.
Under India's 'Connect Central Asia Policy', which is a broad-based approach which includes political, security, economic and cultural cooperation. Beneath this banner, India proposed grant assistance for the implementation of High Impact Community Development Projects which will boost socio-economic development in the Central Asian region. This project was rolled out during the pandemic with the aim that it will help the region in growth and development while the world was still struggling with the economic and political effects of the pandemic. India also announced USD 1 billion as line of credit for priority developmental projects in the Central Asian countries. The announcement of the financial assistance was made during the second meeting of the India-Central Asia Dialogued, a platform where India and its counterparts from Kazakhstan, Tajikistan, Turkmenistan and Uzbekistan discussed about how the aid can be used in fields like energy, IT, healthcare, education, agriculture and connectivity projects. These common issues have been given a priority as they are faced by both India and the Central Asian countries.
India's interest in Central Asia is more than cooperation on the common issues. India is very interested in the Central Asia's energy resources along with expanding its economic influence which would strengthen the regional integration. For these objectives to pan out, enhancing connectivity has been a major goal for India. India, along with Russia and Iran has been engaged in an infrastructural project called International North-South Transport Corridor (INSTC) – a 7,200-kilometer, multi-modal route to the southern Iranian port of Bandar Abbas from where it will further be connected to Azerbaijan, Russia and Europe. The aim is to connect INSTC with Turkey and Central Asian republics which will allow India and the engaged countries to access each other’s market efficiently.
Chabahar Port has been another project of India with Iran and Afghanistan, to develop the southern Iranian port of Chabahar to the Arabian sea and transport goods from India through Iran to Afghanistan and Central Asia via the Chabahar-Zahedan-Mashhad railway. India is also participating in the development of Transport Corridor Europe Caucasus Asia, which would connect the region of Black Sea basic, South Caucasus and Central Asia. It is also engaged in the Central Asia Regional Economic Cooperation which would connect Central Asia which South Asia. Apart from this, the five Central Asian countries and India are exploring the possibility of establishing air corridors which would provide special clearing and custom facilities to expedite regular cargo flights to bolster trade. India has invested in the connectivity projects heavily with a long-term vision to deepen the connection with the Central Asian countries.
On paper, these connectivity projects look perfect and achievable. But India-Iran relations facing fallbacks and Taliban's rise in Afghanistan, the future of projects has been a hotly debated topic in the past few months. Chabahar port of utmost salience as it would play an important role in curbing China’s presence in the region. Given the U.S sanctions on Iran, it’s allied countries which includes India were given six months to reduce their Iranian oil purchases to zero. By May 2019, India complied to this which deeply affected the Iran-India relations. Since then, Iran-India trade has reduced to non- oil related goods. As part of the sanctions, U.S threatened to penalise the countries and foreign companies doing business with India. Since then, Indian firms have become reluctant to participate in the Chabahar port construction - to build facilities in Iran. This fear coupled with the budget constraints from India’s end landed the port project in trouble. Finally, in 2020, tired form the continuous delay, Iran gave contracts to China to build parts of Chabahar - Zahedan railway after cancelling the contracts with Indian companies. While India was dealing with this setback, it was followed but another setback when Iran decided to eliminate Indian firms from the development of Farzad-B gas field project in Persian Gulf.
Similarly, INSTC project has great scope of cooperation, there is lack of comprehensive framework to sustain the development project. With missing complementary infrastructural projects like harbour, docks, the project is solely based on the government capabilities which are currently running short. Apart from harnessing resources from the private sector, there is a need for greater cooperation between the participant countries int he projects to renew the project. India has leveraged its relations with Iran to forge a deeper connection with the Central Asian countries. Most of its projects with Iran extend to the Central Asian countries and given the its unstable relationship with Iran, these projects are in danger. This puts a dampener on India’s plans of regional integration with Central Asia.
The strategic initiatives are being tested by the U.S - Iran conflict in which India is caught in the middle. India's action of siding with US in the Iran-U. S conflict has led to Iran moving closer to China. This is evident from the increasing Chinese participation in the projects where India was initially a leading partner. According to a report published by New York Times, the economic and security partnership between China and Iran is supposed to increasing by $400 billion in the next 25 years where investments will be done in areas of - energy, banking, telecommunication, railways, subways and even ports. This has negatively impacted the India's long term strategic goals in the region. Apart from this, with Taliban taking control of Afghanistan, the insecurity in the region and the fear of increasing extremism has also put a setback on the projects. India's long-standing dispute with Pakistan contributed to the instability.
There are enormous prospects of cooperation between Central Asia and India but the regional integration is facing many challenges currently. Given this, one of the ways to tackle the hurdles is to increase cooperation with Russia as it would help India in dealing with China. The promotion of air corridors should be given preference as it can reap quick benefits for both India and the Central Asian countries. There also is a need to look at projects which are non-economic in nature like medical project, student exchanges, tourism, etc. which can help in development of trust, culture and goodwill between both the regions. Some of the positive developments have happened in the in past few months which has given the India's relationship with Central India a boost. Uzbekistan formally joined the Chabahar Connectivity project along with Afghanistan. Under the INSTC project, the promised Chennai-Vladivostok connectivity project through the Indo-Pacific corridor if operationalised can also be connected with Kazakhstan through the Altai region of Siberia of Russia. This can make Kazakhstan an Indo-Pacific player. Hence, maritime connectivity with the Central Asia via Iran, can help India in strengthening its cooperation with Central India.
Pic Courtesy-Joel Heard at unsplash.com
(The views expressed are those of the author and do not represent views of CESCUBE.)
