In a major geopolitical and economic development, Iran and Russia have unveiled a joint plan to break through the sanctions and economic isolation imposed by the United States and the European Union. While Iran faces restrictions over its nuclear programme and Russia remains targeted due to the Ukraine war, both nations have now found a way to outmanoeuvre Western pressure, through a strategic infrastructure project that also places India at the heart of a new global trade map.
A new trade artery through Asia
Tehran and Moscow are joining hands to build a 162-kilometre railway line as part of the ambitious International North–South Transport Corridor (INSTC), a multimodal transport network that includes India as a key member. Estimated to cost around Rs 17,000 crore, this new railway link will be the first addition to the INSTC since its inception and is expected to revolutionise connectivity across Eurasia. The INSTC, first conceptualised in 2000 by India, Iran, and Russia, aims to link Mumbai to St. Petersburg via Iran and the Caspian Sea. The new railway segment is expected to drastically reduce freight travel time and cost, cutting transit time by 18–20 days and reducing shipping costs by 30–40 per cent compared to the traditional Suez Canal route.
Once completed, the line will handle 15–20 million tonnes of cargo annually, including crude oil, natural gas, steel, machinery, and food products. Russia, which is also financing and overseeing construction, sees this corridor as a lifeline to bypass Western-controlled trade routes and payment systems.
India’s strategic advantage; Challenge to Western and Chinese dominance
For India, the expansion of the INSTC represents both a logistical breakthrough and a strategic victory. The corridor provides New Delhi with a faster, more secure route to Central Asia, Russia, and Northern Europe, avoiding the unstable maritime chokepoints and the Pakistan route. This new link strengthens India’s access to Iran’s Chabahar Port, which it operates, a key gateway connecting India to Afghanistan, Central Asia, and beyond. The INSTC’s rail and sea network connects Chabahar and Bandar Abbas in Iran to two major Russian ports, offering India a seamless overland trade corridor that complements its maritime power in the Indian Ocean.
⚡️BREAKING
Russia announced that 73.2 million tonnes of Russian coal would be exported to India via Iranian ports
The Iranian shipping company IRISL has prepared 300 vessels to facilitate this trade and the time for Russian goods to reach India would drop from 45 days to 15… pic.twitter.com/qchZ8vTQYH
— Iran Observer (@IranObserver0) June 10, 2024
Significantly, Pakistan remains outside this project, giving India a decisive edge in regional connectivity. With Afghanistan now showing interest in joining the INSTC under the Taliban administration, India could gain an even stronger foothold in the region. Tehran has also confirmed that another major railway, linking Chabahar to Zahedan, will be operational by the end of this year, further improving India’s trade access to landlocked Central Asia.
The INSTC not only challenges Western sanctions regimes but also presents an alternative to China’s Belt and Road Initiative (BRI). As Western economies attempt to isolate Russia and Iran, the corridor offers these nations, along with India, a sovereign route for energy, industrial, and agricultural trade without dependence on Western-dominated channels. By integrating its infrastructure, energy, and logistics expertise into the INSTC, India strengthens its position as a balancing power between East and West. The corridor could also reduce global dependence on the Suez Canal, which currently carries about 12% of world trade but remains vulnerable to geopolitical crises and blockages, as seen in recent years.
HAL–UAC partnership ignites India’s civil aviation revolution
Adding another layer to this deepening cooperation, Hindustan Aeronautics Limited (HAL), India’s state-owned aerospace giant, has signed a memorandum of understanding with Russia’s United Aircraft Corporation (UAC) to jointly produce civil commuter aircraft in India. The partnership, announced in Moscow, aims to manufacture the SJ-100 twin-engine narrow-body jet, which can seat up to 100 passengers. The aircraft will be built for Indian and regional customers, marking India’s first-ever venture into large-scale passenger aircraft production.
While the UAC remains under Western sanctions, India has made its stance clear that it does not recognise unilateral sanctions and views such restrictions as politically motivated and unjust. New Delhi has repeatedly pointed out Western hypocrisy, as both the EU and the US continue to buy Russian goods worth billions despite imposing sanctions on others for doing so.
🚨BREAKING: India’s HAL and Russia’s UAC sign MoU in Moscow to jointly produce the SJ-100 commuter aircraft in India 🇮🇳✈️
For the first time ever, a complete passenger aircraft will be 'made in India' under this deal — a big step toward ending Airbus-Boeing monopoly in civil… pic.twitter.com/sKfJw7kdLK
— Megh Updates 🚨™ (@MeghUpdates) October 28, 2025
Aatmanirbhar Bharat’ Takes Flight; A strategic and economic milestone
HAL’s agreement with UAC is not just an aviation partnership, it is a symbolic step toward “Aatmanirbhar Bharat” (self-reliant India) in high-technology sectors. Having long collaborated with Russia on defence projects, including the Sukhoi Su-30MKI fighter jets, HAL now expands its expertise to civil aviation. The Indian civil aviation market is one of the fastest growing in the world. Over the next decade, India will need more than 200 regional jets to connect smaller towns under its UDAN regional connectivity scheme, and another 350 aircraft for short-haul international routes to neighbouring countries. According to HAL, this collaboration “reflects the mutual trust between India and Russia” and marks India’s entry into a domain long dominated by Airbus (Europe) and Boeing (US). INSTC expansion and the HAL–UAC agreement as part of India’s broader strategy to diversify partnerships and assert strategic autonomy in a multipolar world.
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