Iran Establishes Free Trade Zone for Afghan Merchants at Chabahar Port

Iran has established a free trade zone for Afghan merchants at the strategic Chabahar port, providing facilities and security for goods. The move aims to boost trade between Afghanistan and Iran, which reached $2.025 billion in the 1402 solar year, including $33 million in exports.

According to the Ministry of Industry and Commerce, the Chabahar port serves as an important commercial and transit route for Afghanistan. The country has been able to make optimal use of the port by creating facilities such as land and a free trade zone for Afghan traders. Economic experts see the provision of various facilities for merchants in different ports as beneficial, as it can positively impact trade volume and increase Afghanistan's exports to neighboring countries.

The establishment of the free trade zone at Chabahar is a significant development in the economic relations between Afghanistan and Iran. It offers Afghan merchants a secure and facilitated platform to conduct their business activities at the port. The Chamber of Commerce and Investment emphasized the need for thorough studies on exports and imports with neighboring countries, and the creation of necessary facilities for Afghan traders to better compete with regional countries' export items.

Why this matters: The Chabahar port has geopolitical significance as it allows landlocked Afghanistan to access a sea route, bypassing Pakistan. India has also invested in developing the port to open up trade with Afghanistan and Central Asia, while lessening Afghanistan's reliance on Pakistan.

India formally took over operations at the Chabahar Port in 2018, which is expected to provide a key supply route for Afghanistan. The U.S. State Department has exempted the Chabahar Port project from sanctions, recognizing its importance to Afghanistan. The free trade zone established by Iran for Afghan merchants further underscores the port's vital role in facilitating Afghanistan's international trade and economic development, despite regional challenges and complexities.

Key Takeaways

• Iran establishes free trade zone for Afghan merchants at Chabahar port.
• Chabahar port serves as important commercial and transit route for Afghanistan.
• Free trade zone aims to boost Afghanistan-Iran trade, which reached $2.025B in 1402.
• Chabahar port allows Afghanistan to access sea route, bypassing Pakistan.
• U.S. exempts Chabahar port from sanctions, recognizing its importance for Afghanistan.