India has pledged more than $500 million to develop the strategically located port of Chabahar.

Highlights Chabahar port is easily accessible from India's western coast

It is seen as a counter to Pakistan's Gwadar Port, 80 km from Chabahar

First phase of Chabahar port was inaugurated in December 2017

Iran will handover the strategic Chabahar port to an Indian company within a month for operation as per an interim pact, Iranian Minister of Roads and Urban Development Abbas Akhoundi said Thursday.

Mr Akhoundi is in India to participate in the Mobility Summit by NITI Aaayog on the government's invitation. "Now, we are ready just to handover the port (Chabahar) to the Indian company just to operate this in interim agreement that already we had with Indian part for one and a half year," Mr Akhoundi told PTI here.

The Chabahar port is easily accessible from India's western coast and is increasingly seen as a counter to Pakistan's Gwadar Port located at distance of around 80 kms from Chabahar.

Mr Akhoundi after a meeting with his Indian counterpart Road Transport and Highways Minister Nitin Gadkari said: "We have already moved one step forward...We should introduce a banking channel to India, which we already did it and fortunately has been formally accepted by the Indian side".

He said the India has also introduced a banking channel, which has been approved by Iran's Central Bank.

Met Mr. Abbas Akhoundi, Hon'ble Minister of Roads and Urban Development, Iran. We discussed about progress of Chabahar port development & issues related to bilateral cooperation. pic.twitter.com/3S1Q3wSHdt -Nitin Gadkari (@nitin_gadkari) September 6, 2018

"Indian side had investment in Chabahar port and we are moving towards utilisation of the Chabahar port," Mr Akhoundi said, adding that the handing over of the port should be done "during one month. We have done everything".

The first phase of the Chabahar port was inaugurated in December 2017 by Iranian President Hassan Rouhani, opening a new strategic route connecting Iran, India and Afghanistan bypassing Pakistan.

The Chabahar port is being considered as a gateway to golden opportunities for trade by India, Iran and Afghanistan with central Asian countries, besides ramping up trade among the three countries in the wake of Pakistan denying transit access to New Delhi.

"The routes of the region should be connected on land, sea and air," Hassan Rouhani had said at the inauguration ceremony.

Under the agreement signed between India and Iran earlier, India is to equip and operate two berths in Chabahar Port Phase-I with capital investment of $85.21 million and annual revenue expenditure of $22.95 million on a 10-year lease.

On US sanctions impacting oil trade, the visiting minister hoped to find a way out to continue selling crude oil to India.

"Of course, it will impact the trade between the two countries," Mr Akhoundi said, adding the sanctions would not halt oil sale to India.

"At the end of the day, both sides will find out some way out to carry on their relationship as we hear from the Indian part that they are already committed to buy the crude oil and we are also committed to continue our trade relationship with India and buy rice and other food material and also industrial material from the Indian side".

Iran is India's third biggest supplier of crude oil but US sanctions will from November 3 block payment gateways.

"There has been some impact... I will just not say something that is not realistic ...Certainly US has made the trade between the two sides uneasy but I would like to emphasise that this is not something that US can halt and stop this relationship between two sides," Mr Akhoundi added.

He said Iran welcomes Indian firms developing the giant Farzad-B gas field in the Persian Gulf nation. "Indian side is very keen to invest there. We are still to receive the project proposal," he said.

On his meeting with Mr Gadkari, the Iranian Minister said: "We reviewed the formal statement which was released by Prime Minister Modi during Hassan Rouhani's to India. That statement is very very strong which shows that we have very deep relationship".

He said the thing that was emphasised in the meeting was that India is very committed to all the agreements that India has signed.