The port of Chabahar in southeast Iran is central to India's efforts to circumvent arch-rival Pakistan and open up a route to landlocked Afghanistan where it has developed close security ties and economic interests.
According to a Reuter's report, Iranian President Hassan Rouhani has asked India to invest in infrastructure projects worth $8 billion, including an expanded role in developing a strategic port that will open up access to Central Asia, Iran's envoy to New Delhi Gholamreza Ansari said.
"The port of Chabahar in southeast Iran is central to India's efforts to circumvent arch-rival Pakistan and open up a route to landlocked Afghanistan where it has developed close security ties and economic interests,” Iran’s ambassador said.
Rouhani suggested the larger role for India during a meeting with Prime Minister Narendra Modi on the sidelines of a summit in Russia days before the historic nuclear deal between Iran and world powers, he added.
"The potential between Iran and India is great but we were just facing such a wall of sanctions, wall of American pressure," Gholamreza said.
The two countries maintained a close relationship despite the U.S.-led trade restrictions that halved their oil trade to 220,000 barrels per day last year.
In May, India's Shipping Minister Nitin Gadkari and his Iranian counterpart, Abbas Ahmad Akhoundi, signed an $85 million deal for India to lease two existing berths at the port and use them as multi-purpose cargo terminals.
Under the new proposal India could help build second and third terminals at the port, as well as railway connections into the rest of Iran, Ansari said.
India and Iran agreed in 2003 to develop Chabahar on the Gulf of Oman, near Iran's border with Pakistan, but the venture has moved slowly because of the sanctions over Iran's atomic programme.
Meanwhile, the Hindu reported that Indian groups such as Adani and JM Baxi could be among the interested players in the development of the Chabahar port in south-eastern Iran.
With Iran having clinched a nuclear deal with Western powers, the Modi government has begun fast tracking the development of the Chabahar port. The concession agreement for the port would be signed soon, opening doors for the Indian groups.