Moscow develops its new trade routes via Iran

Vladimir Putin in a video conference with Iranian President Ebrahim Raisi on May 17, 2023. AP - Mikhail Klimentyev

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The Iranian president hailed an "important strategic step" in cooperation with Russia. Tehran and Moscow on Wednesday signed an agreement for the construction of a railway line in Iran. It is part of a much more ambitious 20-year-old project led by Russia: the construction of a 7,200 km network of trade routes with Iran and India.

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The 164-km railway line is expected to connect the Iranian city of Astara to the southernmost city of Rasht within three years. From there, Russian products can then be transported to southern Iranian ports before being shipped to Asia, the Gulf or East Africa.

In a sign of the importance given to the event, the signing of the agreement in Tehran was supervised by the two presidents, Iran's Ebrahim Raissi and Russia's Vladimir Putin, who was present by videoconference.

The new route is just the first step in the ambitious plans of Russia, India and Iran to build a network of more than 7,200 km of sea, land and rail routes. But Vladimir Putin sees this as the beginning of a new era. "Today, we are witnessing the implementation of this project first formulated 20 years ago. Flow volumes will increase, Russian and Iranian goods will have easier and more diversified access to foreign markets, the Russian president said. Currently, it takes us 30 to 45 days to deliver goods from St. Petersburg to Mumbai. With this corridor, it will only take us about ten days."

A way to circumvent sanctions

In addition to the "competitive" advantage advanced by Vladimir Putin that will allow goods to bypass traditional sea lanes, this project is one more stone in the rapprochement between Russia and Iran, both targeted by international sanctions AND more than ever with their eyes turned to the east.

The North-South corridor project was viewed with caution by many experts, not least because of the sometimes divergent interests of the countries involved. It must pass through Azerbaijan, which has tense relations with Iran. But the conflict in Ukraine has revived talks between Moscow and Tehran, both anxious to break their growing isolation. Hit hard by sanctions related to its nuclear program, Iran is staging day after day the improvement of its ties with Russia, China and Arab countries, including Saudi Arabia, its great traditional rival in the Middle East.

Announcements of cooperation have multiplied in recent months with Russia in finance, trade in consumer goods or energy, even if the two countries sometimes find themselves competing in certain markets, such as petrochemicals. In the latest example, Russia's second-largest bank, VTB, has opened an office in Tehran, as the two central banks work to connect their interbank transfer systems.

(

With AFP)

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Read on on the same topics:

• Iran
• Russia
• Trade and Commerce
• Ebrahim Raïssi
• Vladimir Poutine