TEHRAN, Iran (AP) — India said Monday it will invest up to $500 million in a deal to develop a strategic port in Iran and both countries planned a number of projects they say are worth hundreds of millions of dollars.
The deal and plans were announced during a visit by Indian Prime Minister Narendra Modi, the first such trip in more than a decade.
In a ceremony marking the agreements, Modi said the bilateral agreement to develop Chabahar, in southern Iran, and the "availability of about $500 million from India for this purpose is an important milestone," in relations between the two countries.
President Hassan Rouhani said working on the port can be a "great symbol" of cooperation between Iran and India. He said Iran's energy resources and Indian mines can pave ground for cooperation in the aluminum, steel and petrochemical industries.
Iran and India also signed a number of agreements to enhance technological, petrochemical and banking cooperation.
Later on Monday the two leaders reached an agreement on the port project and a "transit corridor" with visiting Afghan President Ashraf Ghani, who welcomed the trilateral agreement, saying it is in the best of interests of the regional countries.
The development of the port of Chabahar and its designated roads and railroads expand a trade route for the land-locked countries of central Asia that bypasses Pakistan.
However Rouhani tried to assure Pakistan that the project is not against interests of Islamabad.
"Today's deal will not be against any country and activities of the three countries will serve the entire region and its peace and stability," Rouhani said after the trilateral meeting.
Modi later met Iran's Supreme Leader Ayatollah Ali Khamenei. During the meeting, Khameini emphasized that "fighting terrorism can be another field of cooperation," between the two countries, the supreme leader's website reported.
India also began paying back $6 billion in debt from past oil purchases, last week giving Iran $750 million. It has said it will pay back the remainder of the debt.
In 2012, Iran was India's second-largest crude supplier but oil exports subsequently fell due to international sanctions over Iran's disputed nuclear program.
Tehran has been seeking to reintegrate into the global economic system following a landmark deal with world powers that lifted sanctions in return for limiting its nuclear program.