Iran and Russia are set to invest some USD 38 bn in the development of Trans-Caspian shipping lines as part of the International North-South Transport Corridor (INSTC), Tehran Times reports, citing Iran’s Maritime News Agency. Russia will contribute 35% of the funds, while Iran will contribute 34%, the outlet quotes the Iranian director of the Russian Port of Solyanka Dariush Jamali as saying. Kazakhstan will also contribute some 16.5% of the funding, according to the Eurasian Development Bank (EDB).

REFRESHER- The 7.2k km INSTC serves as an artery for trade between South Asia and Europe, comprising ship, rail, and road routes. The INSTC links Russia, India, Iran, and Azerbaijan. The corridor is the shortest route for commodity transportation, and provides a logistical choice of three routes for shipping containers, grain, metals, wood products, food, and other commodities. The routes include the western, via Azerbaijan, western via Kazakhstan and Turkmenistan, and the trans-Caspian via Caspian seaports.

REMEMBER-Countries are reorienting their logistics for new infrastructure for the INSTC: Investment projects for the INSTC include infrastructure developments and easing border crossing procedures across the countries involved, projects that will require over USD 38 bn in investments, according to an EDB estimate from 2022.

Progress on the Iranian side for INSTC: The Islamic Republic of Iran Shipping Line (IRISL) has also purchased 30 rail wagons and 5.4k containers, as well as order the construction of 21 equipped vessels for the maritime routes of the corridor to boost capacity at the Solyanka Port, Jamali is quoted as saying.

Iran has been actively filling in the infrastructure gaps: Iran and Russia agreed back in May to construct the EUR 1.6 bn Rasht-Astara railway, which would complete a missing link of 162 km between Rasht in Iran and Astara in Azerbaijan once completed in four years. Iran also inked an agreement for Agarak-Kajaran Road, which covers part of the INSTC, last week. The work is to be financed by loans from the EDB, with construction set to begin at the end of the year, and completed within three years.

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