Chabahar fails as ‘Hormuz workaround’ for India and China

• India invested $120m in Iranian port
• Sanctions waiver ended in April
• Chabahar now included in US blockade

Iran’s southeastern port of Chabahar is not a viable alternative sea route for India and China, analysts said, as the US blockade widens beyond the Strait of Hormuz. 

Live vessel tracking data on Tuesday indicated the container-handling facility remained operational, but with little outbound movement for larger vessels, limiting its ability to function properly as a maritime corridor.

The port has been promoted as an Indian-operated gateway into Central Asia which circumvents regional rival Pakistan. That role has been undermined as Washington has widened its dragnet against Iran-linked shipping into the Gulf of Oman.

“Chabahar is outside the strait geographically, but not outside US blockade logic,” said Arsenio Longo, founder of maritime intelligence firm HUAX. “A vessel may avoid Hormuz physically, but it does not avoid the Iranian-port enforcement problem.”

“Chabahar is functioning, but not flowing cleanly,” he added. “It is not a workaround to Hormuz.”

India has invested more than $120 million in developing the facility, positioning it as another trade route into landlocked central Asian republics. The facility is about 540km from the strait.

Longo said the situation was geopolitically “delicate” given India’s involvement. “Chabahar had a special status before the war,” he said.

“It was physically outside the strait, strategically important for India, and to some extent tolerated as a space where Iran could work with external partners without everything being read through the Hormuz chokepoint. That distinction now looks much harder to sustain.”

Neil Quilliam, a Middle East and North Africa expert at Chatham House and AGBI columnist, said the “hybrid” arrangement had unravelled after a US sanctions waiver ended in April.

“Neither markets nor military planners are now making a distinction between Iranian ownership and foreign operations,” he said.

Before the Iran conflict, the US had allowed flexibility for activity linked to the port. Quilliam said this previous “carve out” – justified on humanitarian grounds and as a counterweight to Chinese-backed development at Pakistan’s Gwadar Port 170km away – was no longer being maintained.

“The aim is to deny Iran revenue, even if that means undercutting New Delhi’s regional connectivity ambitions,” Quilliam said.

“The US administration is willing to accept the political cost of forcing India to wind down the project so that it can close down the loophole Iran is able to exploit.”

But he noted the waters around the port were “far from dormant”, despite the slowdown in conventional shipping flows.

“It is now being used for ship-to-ship transfers of Iranian oil destined primarily for China,” he said. “What was intended as India’s bridge to Central Asia is now serving as a pressure valve for the Iranian dark fleet seeking to bypass naval interdiction.”

Longo said several commercial vessels, including container ships and bulk carriers, were visible in and around the port. Some showed deeper draughts, indicating cargo-bearing activity, but outbound movements for larger vessels remained limited, he said.

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Ships were staying at anchor for extended periods with unclear or stale destinations, a pattern consistent with delayed routing decisions. “It is better understood as a staging and enforcement-edge location than as a true bypass,” Longo said.

Pete Hegseth, the US defence secretary, said the transit of two commercial ships on Monday through Hormuz showed there is a “red, white and blue dome” over the waterway.

President Donald Trump announced on Tuesday evening that “Project Freedom” – the operation to guide stranded ships through the contested waterway – would be paused pending a possible peace deal. 

The latest available figures from US Central Command, published on Tuesday after Iran renewed attacks in the strait, showed that 51 vessels had been directed to turn around or return to port under the US blockade, in force since April 13.

Quilliam said Chabahar’s special status under sanctions was becoming harder to sustain. “The hybrid status is now more of a liability than an asset for India,” he said.