US-Israeli Strike on Iran's Bandar Anzali Port Disrupts Crucial INSTC Trade Corridor
In a significant development, a joint US-Israeli missile attack on Iran's Bandar Anzali port has dealt a major blow to the Indo-Russian ambition of boosting bilateral trade to $100 billion by 2030 via the International North-South Transport Corridor (INSTC), experts reported on Saturday. The strike, which occurred on March 18, targeted the Customs House and other key structures in Bandar Anzali, a critical transit hub on the Caspian Sea coast, according to local media reports.
Impact on the INSTC and Trade Routes
The 7,200-kilometre multi-modal INSTC serves as a vital link connecting Mumbai to St Petersburg through Iran, effectively bypassing the Suez Canal to enhance trade between Asia and Europe. This corridor was previously considered a safe and efficient alternative, but the recent attack has introduced new risks. Professor Renat Karamurzov from the Institute of Asia and Africa Studies at Moscow State University highlighted the consequences, stating, "This route bypassing the Suez Canal was considered safe, but now due to higher risks caused by the Israeli-American strikes, the rates of insurance and freight will shoot up, which will have a negative impact on Russia and other CIS countries interested in using it."
Strategic Importance for Indo-Russian Relations
Russian political analyst Sergei Strokan emphasized the corridor's critical role during a television discussion, noting, "This corridor is extremely important for our bilateral relations with India as it significantly cuts transit time from 25-30 days to seven days from Moscow to Mumbai." The INSTC's efficiency is a key factor in achieving the ambitious trade target set by India and Russia. According to Russian Deputy Prime Minister Vitaly Saveliyev, over 7.5 million tonnes of cargo had been transported through the trans-Caspian route by the end of 2025, underscoring its growing significance.
Broader Context and Regional Implications
The attack on Bandar Anzali comes amid escalating tensions in the region, including reports of Israel targeting Tehran during Nowruz celebrations and defensive responses from UAE and Kuwait to missile barrages. Additionally, over 20 nations have issued a joint statement condemning Iran's de facto closure of the Hormuz Strait, while Iran has tested long-range weapons with missiles fired toward Diego Garcia, prompting the US to deploy Marines and warships. These events collectively heighten geopolitical risks, further complicating trade logistics and security along the INSTC.
As the situation unfolds, the disruption to the INSTC poses significant challenges for global trade dynamics, particularly affecting countries reliant on this corridor for efficient cargo movement. The increased insurance and freight costs predicted by experts could slow down trade flows, impacting not only Russia and India but also other nations in the Commonwealth of Independent States (CIS) and beyond.
