US extends sanction waiver for Chabahar port; India to continue project work

India’s project work at the Chabahar port in Afghanistan  will continue “as usual” now that it has secured an extension on waiver from US sanctions for its investments in the port, sources have said.

“India has received a waiver from the sanctions on Chabahar port. The country’s project activities at Chabahar port will continue as usual now that the sanction waiver has been extended till early next year,” a source tracking the matter told businessline.

Although the waiver window is small, till early next year, it gives New Delhi enough space to continue its activities for some months and then take further decision depending on the sanction situation when the waiver ends.

Securing the waiver is a huge relief as developing the Chabahar port is of both strategic and economic interest to India. It would allow the country to bypass Pakistan to access Afghanistan and Central Asia, all the way to Russia and Europe.

Last May, India and Iran finalised a 10-year agreement for India to operate and manage the Chabahar port, which is advantageously located near Iran’s southeastern border with Pakistan. The deal involves an Indian investment of approximately $120 million, with an additional $250 million to be raised as debt. The agreement was formally signed by India’s state-run Indian Ports Global Limited (IPGL) and the Port and Maritime Organisation of Iran.

In September this year, the US had announced that it will revoke the sanctions waiver for operations at Iran’s Chabahar port, issued in 2018, effective September 29. The US Department of State, in a release, said that with this, individuals linked to operations at the port would be exposed to sanctions under the Iran Freedom and Counter-Proliferation Act.

This was in line with US President Donald Trump’s “maximum pressure” policy on the Taliban regime in Afghanistan 

Following the US decision on revoking the waiver, the Indian Foreign Ministry entered into discussions with the country on the importance of the project and sought a waiver extension.

“India’s activities at the port can continue smoothly till the waiver period lasts. After that India will take the next step depending on the situation. It could seek another waiver extension if sanctions remain,” another source said.

India and Iran have projected the port as a key hub for the 7,200-km-long International North South Transport Corridor  for moving freight between India, Iran, Afghanistan, Armenia, Azerbaijan, Russia, Central Asia and Europe, bypassing Pakistan.

Published on October 30, 2025