India has been actively expanding its influence through strategic investments in overseas ports. This article provides an in-depth overview of these investments, highlighting their significance and impact on India’s trade and geopolitical landscape.
India’s growing economy and its aspirations to become a significant player in global trade have driven its investments in overseas ports. These investments are not only aimed at securing trade routes but also at fostering international partnerships and enhancing India’s strategic interests globally.
Some of these investments are made directly by the Indian government (e.g. Chabahar Port, Iran), while others are carried out through private entities such as the Adani Group (e.g. Haifa Port, Israel).
Strategic Significance of Indian Ports Abroad
The following are some key significances of India’s overseas ports investments:
Enhancing Trade Routes
By investing in ports across different continents, India aims to facilitate smoother and more efficient trade routes. This reduces dependency on any single trade corridor and ensures the uninterrupted flow of goods and services.
Strengthening Diplomatic Ties
Port investments are often accompanied by enhanced diplomatic relations. By collaborating with host countries, India strengthens its bilateral ties, promoting mutual economic growth and cooperation.
Securing Strategic Footholds
Some of these ports are located in geopolitically significant regions. Investing in such locations ensures that India has a strategic presence, which can be crucial for national security and influence in international affairs.
Some ports are vital for military logistics, offering refueling and maintenance facilities for naval vessels (e.g. Duqm Port, Oman).
Countering China’s Influence
India’s overseas ports investments are also strategically aimed at countering China’s influence, particularly in the Indian Ocean region.
China has been expanding its presence through the “String of Pearls” strategy, which involves developing a network of commercial and military bases in countries surrounding India. By investing in key ports, India seeks to balance this influence and ensure its own strategic interests are protected.
Key Overseas Ports Investments of India
Here are some key examples of overseas ports where the Government of India or Indian companies have invested:
1. Sittwe Port, Myanmar
Part of the Kaladan Multi-Modal Transit Transport Project, Sittwe Port enhances connectivity between India’s northeastern states and Myanmar.
The project offers an alternative to the Siliguri Corridor (commonly referred to as the Chicken’s Neck), which connects the rest of India to the northeast. It also intends to reduce the time and cost of shipping items, including necessities, to the Northeast.
Another notable aspect of Sittwe is its proximity, just 65 nautical miles from Kyaukpyu, Myanmar, where China is developing a port with access to the Indian Ocean as part of its broader strategic initiative, often referred to as the ‘String of Pearls’.
The investment in the Sittwe Port is made by India Ports Global Ltd (IPGL), a company wholly owned by the Ministry of Ports, Shipping and Waterways, Government of India.
2. Chabahar Port, Iran
Situated in southeastern Iran, Chabahar Port is a critical asset for India, providing direct access to Afghanistan and Central Asia. It reduces India’s reliance on Pakistan for trade routes and serves as a counterbalance to China’s Gwadar Port in Pakistan.
The Chabahar Port consists of two separate ports: Shahid Kalantari and Shahid Beheshti. India is investing in the Shahid Beheshti Port through India Ports Global Ltd (IPGL).
The port is Iran’s sole deep-sea port and a crucial transit hub on the International North-South Transport Corridor, a key route connecting India, Iran, Russia, Central Asia, and Europe by sea, rail, and road.
3. Mongla and Chattogram Ports, Bangladesh
In 2018, India signed a bilateral agreement with Bangladesh to utilize the ports of Mongla and Chittagong for transshipment, aiming to improve connectivity and boost trade between the two nations.
Additionally, utilizing these ports for transshipment will reduce the distance between Kolkata and major cities in the northeastern states from over 1,200 km to nearly half.
Two major developments in this regard have further strengthened this initiative:
- In April 2023, Bangladesh granted India permanent access to Chattogram and Mongla Ports for the transit and transshipment of cargo vessels, a move expected to significantly cut the time and cost needed to transport goods to India’s northeastern states.
- In July 2024, India secured a significant strategic win by obtaining the operational rights to a terminal at Bangladesh’s Mongla Port, surpassing Chinese interests. The terminal will be operated by India Ports Global Ltd (IPGL), a wholly-owned company of the Government of India. This will be the third foreign port operated by IPGL, following Sittwe Port in Myanmar and Chabahar Port in Iran.
4. Colombo Port’s West Container Terminal, Sri Lanka
In September 2021, India’s Adani Ports and Special Economic Zone Ltd (APSEZ) signed an agreement with the Sri Lanka Ports Authority (SLPA) and the Sri Lankan conglomerate John Keells Holdings to jointly develop and operate the West Container Terminal (WCT) of the Colombo Port.
As per the agreement, the Adani Group is expected to invest $700 million and will hold a 51 percent stake in the WCT at Colombo Port.
The project, based on a build-operate-transfer agreement spanning 35 years, aims to enhance the WCT’s container handling capacity. This move is expected to expand transshipment options across South Asian waters, benefiting both India and Sri Lanka.
5. Haifa Port, Israel
In July 2022, a consortium of India’s Adani Ports and Special Economic Zone Ltd (APSEZ) and Israel’s Gadot Group won the lease to privatise Israel’s second-largest port, the Haifa Port.
The Port handles nearly half of Israel’s container cargo and is also a principal port for passenger traffic and cruise ships. This partnership gives India a significant presence in Israel.
The Haifa Port has the potential to act as a major trans-Mediterranean maritime link to the European mainland, which will ease the transshipment of Indian goods to major markets in Europe.
6. Duqm Port, Oman
India has obtained access to the strategically important Port of Duqm in Oman for military operations and logistical support. The port serves as a staging ground for the Indian Navy, enabling it to extend its role as a net security provider.
This move also aligns with India’s maritime strategy to balance China’s presence and activities in the region.
India’s position in the Port of Duqm provides a crucial strategic advantage, given its location overlooking the Gulf of Oman, the Indian Ocean, and the Arabian Sea. Additionally, the port is close to the India-invested Chabahar Port in Iran.
In early 2024, Oman allocated a specific zone to India within the Port of Duqm, further enhancing India’s influence in the region.
7. Sabang Port, Indonesia
Located at the northern tip of Sumatra (Indonesia), Sabang Port is another strategic location where India has shown interest. It lies roughly 700 km from the Andaman and Nicobar Islands and provides a strategic point close to the Malacca Strait, a crucial maritime chokepoint for global trade.
Although discussions regarding the development of the port began in 2018, there have not been any concrete advancements so far.
The development of the Sabang Port will provide India with a stronger foothold in the Indian Ocean Region. It will help counter China’s growing maritime influence in the area, thus contributing to a rebalancing of power dynamics.
Apart from the above-mentioned ports, India has also shown interest in developing military and infrastructural facilities on Assumption Island in Seychelles since around 2015.
The plan was to establish a naval base to strengthen security in the Indian Ocean region. However, this initiative faced significant challenges, particularly due to domestic opposition in Seychelles. One of the leaders of this opposition, Wavel Ramkalawan, who was associated with the anti-base movement, won the Seychelles presidential election in 2020. This political shift contributed to setbacks in the project.
More recently, India’s Adani Group, through its subsidiary Adani Ports and Special Economic Zone Limited (APSEZ), has been planning to develop a deep-sea port in Bataan province, Philippines. This investment aims to enhance trade, strategic leverage, and regional influence and is also seen as an effort to bolster alliances and assert maritime presence in the contested South China Sea region.
