Iran leans on remote port to beat US sanctions

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With the web of US sanctions tightening, Iran faces a host of challenges as it looks to an isolated port in the country’s far southeast to maintain the flow of goods. (AFP)
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The port in Chabahar is located only about 100 kilometres (62 miles) from the Pakistan border and located on the Indian Ocean. (AFP)
Updated 27 March 2019
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Iran leans on remote port to beat US sanctions

  • It is the only Iranian port with exemptions from unilateral economic sanctions reimposed by the US in 2018
  • It is Iran's largest outside the Gulf

CHABAHAR, Iran: With the web of US sanctions tightening, Iran faces a host of challenges as it looks to an isolated port in the country’s far southeast to maintain the flow of goods.
The port in Chabahar, only about 100 kilometers (62 miles) from the Pakistan border and located on the Indian Ocean, is Iran’s largest outside the Gulf.
It is also the only Iranian port with exemptions from unilateral economic sanctions reimposed by the United States in 2018.
That is due mainly to the pivotal role of the port, and a planned railway line, in breaking landlocked Afghanistan’s dependence on Pakistan for trade with the world, especially India.
Afghan trade as well as plans for a trading route by rail between central Asia and the Indian Ocean called the North-South Corridor are the main reasons the Islamic republic has invested one billion dollars in Chabahar’s Shahid Beheshti port, official sources say.
“We will keep on developing this port... our rail network, road network and airport are all being developed, so that we can implement the North-South Corridor,” Roads and Urban Development Minister Mohammad Eslami told AFP while visiting Chabahar for a development conference.

More than 200 hectares (almost 500 acres) of land have been reclaimed from the sea for the project and over 17.5 million cubic meters (618 million cubic feet) dredged, creating a 16.5-meter (54-foot) draught.
But more than a year since the new installations became operational in December 2017, business has yet to pick up.
The ships that officials say have docked in the past year have only loaded and unloaded 2.1 million tons of cargo, a far cry from the port’s annual capacity of 8.5 million tons.
Only 20 ships have docked at the new section of the port and most of its three kilometers of waterfront remains unutilized, with new machinery and neatly lined-up cranes standing idle.
But authorities remain upbeat about the prospects for growth.
Hossein Shahdadi of the provincial ports and maritime authority said that in the first 11 months of the past Iranian year, which started on March 21, 2018, “there has been a 56 percent increase in cargo handled at the port compared with the previous year.”
“We’ve also had a 25 percent rise in the number of ships calling at the port” on the Gulf of Oman, he said.
Arun Kumar Gupta, managing director of India Ports Global Limited which has a 10-year concession at the new port, played down the startup issues.
“Any port will have a gestation period, there will be lulls but we are very sure that traffic will pick up,” Gupta told AFP.

The Indian company began work in December and has so far handled only an average of 60,000 tons of cargo per month.
But Gupta is counting on the port’s proximity to India and Afghanistan to attract business.
Chabahar’s location, however, carries its own risks as it lies in the volatile Sistan Baluchistan province where militant jihadists operate.
In December, a suicide attack on the local police headquarters killed two policemen.
During an investment conference in February, security was tight with many roads cut off and hundreds of armed security personnel deployed to protect delegates.
Apart from security concerns, US sanctions banning financial transactions with Iran make it ever harder to pay or receive payments.
Some like Afsaneh Rabiani, who runs a freight forwarding company, see Chabahar as an opportunity for “those willing to take the risk.”
“I’ve been researching Chabahar for the past year and a half, and the infrastructure is now in place to do serious work here,” she said.
As for the sanctions, Iran’s roads minister said the challenge was nothing new.
“We were born with sanctions. Ever since the (1979 Islamic) revolution, we have been under sanctions and we are working on how to counter them,” Eslami said, as he oversaw the unloading of a first shipment of Afghan goods lined up to be re-exported from Chabahar.


From moros to mass tourism — historical bonds fuel Saudi-Spanish tourism takeoff, says ex-Balearic leader

Updated 10 sec ago
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From moros to mass tourism — historical bonds fuel Saudi-Spanish tourism takeoff, says ex-Balearic leader

  • Jose Ramon Bauza says Saudi-Spanish tourism ties may be in their infancy but are poised for a fruitful relationship
  • ‘Kingdom has everything to become global leader on vacational and family destinations,’ former Spanish senator tells Arab News

MADRID: Saudi-Spanish tourism ties may still be in their infancy, but for Jose Ramon Bauza Diaz, they already have the makings of a “family affair.”

“We are at the very beginning of what should be a fruitful and successful relationship,” the former Spanish politician turned tourism consultant told Arab News on the sidelines of FITUR, the flagship global tourism fair.

“Everything has yet to be done. I think we are not starting from scratch, but we are at a starting point, and we have both the opportunity to do a lot of things together.”

Spain welcomed a record 93 million visitors in 2024, overtaking the US as the world’s second most visited country by international arrivals. The Kingdom represents a small proportion, with around 182,000 Saudis visiting in 2023.

Even so, Bauza believes the two countries are “warming up” fast, helped by deep historical links dating back to the presence of ‘moros’ — ancient Arabs whose legacy is etched into the Iberian Peninsula’s culture and architecture.

“We believe in the same principles. We believe in family, we believe in trust. We believe in doing things (together). We love being together; we are not people who want to be isolated,” he said. “This is a specific and privileged starting point.”

Tourism is a central pillar of Saudi Arabia’s Vision 2030, with the Kingdom only fully opening up to global visitors about a decade ago. In 2025 it welcomed more than 122 million domestic and international visitors, a 5 percent year-on-year rise that keeps it on track to reach 150 million by the end of the decade.

Religious tourism has been a key driver alongside a strong push into the luxury segment, but Bauza warned that overreliance on a narrow niche could limit the sector’s full potential.

“Saudi (Arabia) is currently very focused on the luxury (segment); that’s perfect — it is (already) one of the best in the world (in that market). But I think the Kingdom can (also) be the best in the world in vacation tourism, family tourism, and the upper middle to high-end (segment),” he said.

Drawing on Spain and Europe’s experience as industry leaders, he argued that no country can afford to compromise on quality.

“Everyone that (sets) quality (apart) is penalized,” he stressed. “Saudi has everything to be a top luxury destination. But as well that, to be the top vacational and family destinations (offering) high quality standards.”

Despite sluggish global growth, the tourism market is set to expand in the coming years, driven by rising consumer demand and easier access to international travel. The sector already accounts for just under 10 percent of global gross domestic product, supports more than 330 million jobs, and is growing about 1.5 times faster than the world economy. A recent report by the World Economic Forum and Kearney projects that annual tourist trips will reach 30 billion by 2034.

For Bauza — who during his tenure as a Member of the European Parliament served as chair of the Tourism Task Force and a member of the delegation for relations with the Arabian Peninsula — these numbers underline both the scale of opportunity and the difficulty of expanding responsibly, especially when it comes to sustainability.

“I always prefer to talk about quality than quantity,” he said. “When I was president of the Balearic Islands, I was not running for how many million tourists we had, but (rather) on how many quality tourism opportunities we could offer.” He added that with the right strategy, quality and quantity could grow together without “over-touristifying” a destination.

Spain has wrestled with over-tourism in recent years, triggering local protests over the sheer volume of visitors. The Balearic Islands, Barcelona, Andalusia and other hotspots have seen mounting anger over the impact on daily life, from water shortages to urban changes that increasingly cater to tourists rather than residents.

“What’s important is to have properly scaled infrastructure to provide the best services,” Bauza said, arguing that destinations needed clear plans taking residents’ needs into account as well as the efficiency and resilience of buildings and infrastructure.

“If we know we will grow in an area in the next 10 or 15 years, we need to provide the infrastructures and the structures (in advance),” he said, adding cities must be designed for both those who live there and the visitors who arrive from around the world, with “a common way of thinking that tourism is part of the way of living.”

Riyadh has made sustainability a core principle of its development blueprint. Flagship projects such as the Red Sea Project, Neom and Amaala are framed around 100 percent renewable energy, biodiversity conservation and bans on single-use plastics in a bid to create “nature-first” destinations.

Bauza said Saudi Arabia — which skipped this year’s FITUR despite a strong regional presence — has a chance to learn from mature tourism markets where rapid growth has brought economic gains but also environmental and social strain when not managed holistically.

“We have the knowledge of the tourism sector,” he said. “As a former president of the Balearic Islands, I’m proud that the big global brands are not only Spanish, they are from Mallorca and Ibiza. We can put this (experience) on the table — not to (tell) anyone what to do, not at all. (But) just to say to them: ‘Look at what we’ve done, see if it works for you. Copy it (if it fits). Let’s do it together because we have decades of experience’.”

In 2021, the tourism ministers of Saudi Arabia and Spain signed a joint statement to “redesign tourism,” agreeing to cooperate on three pillars — sustainability, digital transformation (including smart destinations and data sharing) and human-capital training.

These commitments were renewed in May 2025, when Madrid and Riyadh sealed four new private-sector deals to deepen investment and economic cooperation, with tourism highlighted as a strategic priority.

Spain now sees Saudi Arabia as a key Middle Eastern growth market. The 182,000 Saudis who visited in 2023 made the Kingdom Spain’s top Gulf Cooperation Council source market within a broader Gulf visitor base of 434,000 that year. That momentum has spurred a rise in investment flows.

Leading Spanish hospitality groups such as Melia Hotels International and Barcelo Hotel Group — both out in force at FITUR — are expanding their footprint in the Kingdom. At TOURISE 2025, Melia, Spain’s largest hotel operator, signed a Memorandum of Understanding with Saudi Arabia’s Tourism Development Fund to develop around 1,000 hotel rooms, while Saudia has launched direct Jeddah-Barcelona flights to complement services to Madrid and better integrate Saudi hubs with Spanish gateways.

Bauza welcomed the progress but said more must be done to unlock the full potential and build out services beyond core hospitality.

“Tourism is much more than hotel, much more than a restaurant, much more than a boutique, much more than an airport, much more than a museum. Tourism is an experience,” he said. “The goal is for Saudi people and Spaniards to work together. And the message is: It’s about to come (soon).”

“We need to trust each other, and we’re well prepared to take this step forward hand in hand, identifying the best options for quality tourism, not just quantity. Saudi Arabia is absolutely ready — globally, I see no country more committed.”

He added: “The key word is trust. We need to trust one each other, and we’re very well prepared to do this step forward together hand by hand, identify(ing) the best options for quality, not quantity tourism. And Saudi Arabia is absolutely prepared. Globally speaking, I cannot see any country who is much more committed.”

Bauza called for the Kingdom to secure a strong presence at FITUR to tell its own story: “If you’re not here, you’re not visible. You need a specific strategy for (showing) the many spectacular things you’re doing in tourism. I know because I’ve been there, but people who are not there, they don't know. (And) nobody’s telling them.”