Is the INSTC Russia’s new economic escape route?

Al Jazera News:-

As the world worried about Russia’s blockade of Ukrainian grain exports in the Black Sea in late June, Vladimir Putin had a different trade route on his mind. Addressing leaders of nations that sit on the Caspian Sea, the Russian president spoke of a “truly ambitious project” as the centrepiece of Moscow’s efforts to “improve the transport and logistics architecture of the region”.

For more than two decades, the International North-South Transport Corridor (INSTC) — a 7,200-kilometre (4,474-mile) network of railroads, highways and maritime routes that connects Russia and India through Iran — has been little more than a pipe dream. But this old wine is finally ready to be uncorked by Moscow, Tehran and New Delhi, according to analysts. A rare confluence of geopolitical and economic incentives is turning the route into a potentially vital economic escape pathway for Moscow as tough Western sanctions deny the Kremlin access to European markets.

In June, Iran announced the first-ever pilot transit of goods from Russia to India using the INSTC, through the port of Bandar Abbas on the Strait of Hormuz. The two containers of wood laminate have since been followed by the shipment of at least 39 more containers headed from Russia to India’s Arabian Sea port of Nhava Sheva in July.

This is just the start, said Vaishali Basu Sharma, a former consultant at India’s National Security Council Secretariat. Earlier this month, RZD Logistics, the largest multimodal transport operator in the former Soviet nations and the Baltics, launched a new container train service along the INSTC. And by 2030, the INSTC corridor is expected to have the capacity to transport up to nearly 25 million tonnes of freight each year — 75 percent of the total container traffic between Eurasia, South Asia and the Gulf.

“These are the new routes east, and Moscow is very serious about getting these put in place, especially as EU sanctions are expected to remain — even after the conflict with Ukraine is over,” said Chris Devonshire-Ellis, founder of Dezan Shira & Associates, a pan-Asian business and investment consultancy, to Al Jazeera.