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From the Silk Route to the Tea Route

Neena Haridas in New Delhi

If the Silk Route romanticised Indo-Central Asian relations in 19th century, it is the Tea Route that will take the fancy of the 21st century. If it was the Qin dynasty that paved the Silk Route, it will be India and Russia that will lay the foundation for the Tea Route.

If the Silk Route was not all about silk, the Tea Route too is not all about tea. But it definitely is all about moolah.

This is what is being touted as the most ambitious project since the Siberian Rail - a transport corridor between India and Russia through Iran, which will open up the European market to Asian economies like never Before; a north-south corridor that comprises sea and land links across India, Iran and Russia connecting Asian and European continents, reducing travel time and enhancing trade opportunities.

On September 12, Russian Transport Minister Mikhai Ksyanov, Indian Surface Transport Mminister Rajnath Singh and Iranian Minister of Roads and Transport Mahmud Hojati signed an agreement, initiating the development of this corridor, as part of an action plan to step up economic relations between India, Russia and Iran.

The link is based on the premise of mutual extension of a most favored nation preferential treatment among India, Russia and Iran, the three involved.

The agreement has been entrusted with Iran, the depository country. The corridor runs from the western ports in India, southern and northern Iranian ports of Bandar Abbas and Bandar-e-anzali to Moscow and other Russian cities.

The Indo-Russian trade route, which passes through the Suez canal and enters the Russian port of St Petersburg via Kotka (Finland) and Rotterdam (Netherlands), is long and time-consuming.

The new route will reduce transportation costs by 20 to 25 per cent and once it is fully operational, Indian tea exports will be a major beneficiary.

This path has been in existence for over a century - but it is only now that the three countries have decided to enhance its usage for mutual benefit. In fact, the corridor derives it name Tea Route as Indian traders used this beaten road to transport and sell tea in Iran and central Asia. Much like how the Silk Route got its name as Chinese silk traders used the road to transport silk.

According to sources in the surface transport ministry, the corridor is expected to boost shipping services between India and Iran through the Iran-Hind Shipping Company, a joint venture between the state-owned Shipping Corporation of India and the National Iranian Oil Company.

The north-south corridor will link Indian ports with the Russian port of Astrakhan on the Caspian sea, from where containerised cargo will be delivered to major Russian commercial centres by train.

The containers from Indian ports on the west coast will be shipped to the Iranian port of Bander Abbas in the Persian Gulf, from where it will be transported by rail to Bander Anzali on the Caspian sea.

From there, cargo will be shipped to Astrakhan and then routed by land to other Russian destinations.

Today, only 200 containers ply between the three countries on an average every month. With the completion of construction work at the Russian port of Olya and reconstruction of the Iranian port of Amirabad, freight turnover is expected to go up to an annual figure of five to 10 million tonnes.

Yevgency A Isaev, trade consular, Trade Representation of the Russian Federation in India, pointed out: "Transportation has always been a major problem hindering growth of Indo-Russian trade ties. But this corridor is expected to radically change the approach to sea and railroad shipments between Europe and southern Asia and the Persian Gulf and make them comparable with air freight operations by reducing delivery terms."

The transport corridor will have an operator controlling all cargo operations and railroad cars, tanks, containers and cargo trailers will be used for transportation.

Singh seconded Isaev: "Now that the trade route has been formalised, there will be rationalisation of procedures at entry points, easy movement of goods along routes, simplified customs formalities and a single document system, for goods from the three countries."

Russia is the biggest market for Indian tea. But with this route, and increased accessibility exports from India - and not just tea - several items are expected to increase manifold.

A co-ordination council will have representatives from key ministries of each country, which will oversee implementation of the agreement. The ministry of commerce and department of shipping, ministry of surface transport, will represent India in the council.

According to sources in the surface transport ministry, the Russian firm Trsotr, Indo-Iranian firm Iran-Hind and some firms in Astrakhana and other places in Russia are participating in the ambitious venture, which will pass through sea, deserts, high mountains, plains and plateaus across two continents.

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