Editorial: New challenges in Middle East
A strong push for INSTC will be a strategic step to protect its interests in Middle East
India needs to up its game in the Middle East in view of the shifting geopolitics in the region due to China’s growing influence. Beijing has successfully brokered a deal between the arch-rivals Iran and Saudi Arabia leading to the revival of diplomatic ties recently between the two major Islamic powers. This could have far-reaching implications for international politics in general and Asia in particular. For India, the development provides a reality check on Beijing’s growing role in shaping global events. Of particular concern is the future of the ambitious International North-South Transport Corridor (INSTC). Announced in September 2000 by India, Russia and Iran, this 7,200-km long multimodal transport corridor connects the Indian Ocean and Persian Gulf to the Caspian Sea via Iran and is then connected to Russia and Northern Europe. Both Iran and Saudi Arabia are important trading partners for India, which has strong economic and strategic interests in the Middle East through INSTC. For India, the INSTC is now more crucial than ever before and it needs to aggressively push for tapping the full potential of the project. This year, India holds the presidency of the Shanghai Cooperation Organisation (SCO). The current geopolitical turmoil and the decoupling of Russia and the West – in the wake of Russia’s invasion of Ukraine – presents an opportunity for India and INSTC. India has a lot to gain once there is seamless rail freight connectivity through Iran for INSTC.
Mumbai could then become an Asian transhipment hub for goods to Europe, competing with hubs in China, especially when western companies want to decrease their dependence on China and move their production to other parts of Asia. If INSTC’s full potential as a seamless transportation corridor is to be realised, India could also attract a significant chunk of export-oriented manufacturing activities that are looking to move out of China. While being vigilant about the increasing Chinese influence in the region and working towards securing its strategic interests in the Middle East, India can play a constructive role in promoting dialogue and cooperation between Iran and Saudi to ensure regional stability. The INSTC opens up quicker and cheaper access for India to markets in Europe, Russia and Central Asian countries. At the same time, hydrocarbons and other mineral resources from the mostly land-locked Central Asian countries will be easily accessible to India’s rapidly growing economy. The corridor will also make it faster and cheaper for India to import fertilizers, steel and coal from Russia and Ukraine. Cheaper coal imports through this route could give India leverage while purchasing coal from its traditional suppliers Australia and Indonesia. A strong push by India for the INSTC now will be a strategic step to protect and advance its interests in the Middle East and attract significant foreign direct investments to the country.
