China's Shipping Route to Iran
By Aiswarya Lakshmi
Friday, March 11, 2016
Two state-run Chinese firms - China National Transportation Equipment & Engineering Co Ltd (CTC) and Dalian Shipbuilding Industry Co (DSI) - are pushing for multi-billion dollar Intermodal transport deals with Iran, says a report in Reuters.
CTC is close to finalizing an agreement on the $3 billion rail project to connect Tehran with the northeastern holy city of Mashhad, a Chinese source told Reuters. China's Export and Import Bank (EXIM) is expected to fund 85 percent of the cost for the 930-km (580 mile) rail project.
DSI has likewise been in discussions on building container ships and oil tankers for Iran, according to two sources who declined to be identified because the talks are still continuing.
China, Iran's largest trading partner and long-time ally, has agreed to boost bilateral trade by more than 10 times to $600 billion in the next decade.
With Iran no longer subject to international sanctions since January following its nuclear deal with world powers, Beijing sees the country as part of its policy to increase trade and open new markets for its firms as the domestic Chinese economy slows.
Meanwhile, media sources say that China has launched a new maritime shipping route to Iran. On January 23, Iranian President Hassan Rouhani and Chinese President Xi Jinping signed 17 cooperation agreements to strengthen bilateral ties.
One of the agreements reportedly covered developing and constructing China's ambitious New Silk Road project as the two countries set a goal of increasing bilateral trade to $600 billion in the next 10 years.