New Delhi: India and Iran signed a 10-year contract on Monday to develop and operate the Shahid Beheshti terminal at Chabahar port on Iran's south-east coast. 

India Ports Global Ltd and the Ports and Maritime Organisation of Iran executed the contract in Tehran, in the presence of Union Ports, Shipping, and Waterways Minister Sarbananda Sonowal. 

Sonowal stated that by signing the agreement, the two countries have created the groundwork for India's ongoing participation in Chabahar.

According to Mehrdad Bazrpash, Iranian Minister of Roads and Urban Development, the government-owned IPGL would invest approximately $120 million, with an additional $250 million in finance, bringing the total contract value to $370 million. 

The development comes at a time when China is looking to enhance its investments in Iran's ports and coastal infrastructure.

Chabahar Port's importance extends beyond its status as a basic conduit between India and Iran. It is a vital commerce route that connects India to Afghanistan and Central Asia.