India’s SCO vision of connectivity, Chabahar stakes, and the CPEC challenge

Prime Minister Narendra Modi’s participation and remarks at the Shanghai Cooperation Organisation (SCO) Summit in Bishkek (August 31 to September 1) delivered against the backdrop of intensifying geopolitical rivalries and sanctions pressures, framed India’s position not merely as a call for dialogue but as a strategic assertion of its role in shaping Eurasia’s economic and security architecture.

Modi’s meeting with Iranian President Masoud Pezeshkian was particularly significant. It marked their first in-person interaction since the outbreak of the West Asia war earlier in the year, though the two leaders had remained in contact through phone calls.

At Bishkek, Modi articulated three pillars of India’s SCO vision; security, connectivity, and opportunity. He called for dismantling the “ecosystem of terrorism” and insisted that conflicts must be resolved through dialogue, not battlefields. On connectivity, Modi’s words carried layered meaning. India supports initiatives that link markets and facilitate trade, but he stressed that such projects must respect sovereignty and territorial integrity. This was a pointed reminder of India’s opposition to the China–Pakistan Economic Corridor (CPEC), which traverses disputed territory in Gilgit-Baltistan. Modi’s emphasis on sovereignty was thus both a principle and a strategic rebuttal to Beijing and Islamabad’s connectivity narrative.

The Chabahar Port project epitomises India’s connectivity ambitions. Conceived as a trilateral mechanism among India, Iran, and Afghanistan, Chabahar has evolved into a geo-economic platform of regional significance. For India, Chabahar offers a route to Afghanistan and Central Asia that bypasses Pakistan, while embedding itself in the International North-South Transport Corridor (INSTC).

Yet India’s strategic foothold in Chabahar faces mounting challenges. In April 2026, New Delhi prepared to scale back direct ownership by transferring its stake to an Iranian entity, insulating operations from sanctions as the US waiver expired. Foreign Secretary Vikram Misri acknowledged that the war in West Asia had altered the regulatory environment, complicating activities at Chabahar. Meanwhile, Washington has intensified its campaign under “Operation Economic Outcast,” threatening secondary sanctions on banks and institutions dealing with Iran. Treasury Secretary Scott Bessent warned that violators risk exclusion from the dollar-based system. India, having already seen its trade with Iran shrink to a fraction of its 2018 peak, now faces the dilemma of safeguarding strategic interests while navigating punitive measures.

Despite US sanctions, Iran has pressed ahead with development. Ambassador Mohammad Fathali has shared that the Chabahar-Zahedan railway had reached 90 per cent completion, with rail-laying operations expected to finish by mid-2026, linking the port to Iran’s national network. Infrastructure improvements, including hospitals and hotels, are also underway, positioning Chabahar as a sustainable hub.

India’s connectivity calculus extends beyond Iran. The India-Middle East-Europe Economic Corridor (IMEC), announced at the G20 summit in 2023, was envisioned as a counter to China’s Belt and Road Initiative. Yet the ongoing Middle East crisis has obstructed its progress. Moreover, Chinese presence along IMEC routes remains unavoidable—Piraeus port in Greece is controlled by COSCO, and Chinese firms are involved in Etihad Rail projects. This reality underscores the complexity of disentangling connectivity from China’s pervasive footprint. In this context, Chabahar’s independent location, outside the Strait of Hormuz and with lower transport costs, emerges as a secure and strategic option for India.

The regional rivalry between Chabahar and Gwadar mirrors the broader contest between the India–Iran and China–Pakistan axes. Although, the contrast between Chabahar and Gwadar is stark. Gwadar, the flagship of CPEC launched in 2013, remains heavily dependent on Chinese investment and strategic imperatives. Its positioning provides Beijing direct access to global energy routes and addresses the “Malacca Dilemma.” In May 2026, Pakistan’s Prime Minister Shehbaz Sharif and Chinese leaders announced a “new broad consensus” to deepen ties, upgrade the Karakoram Highway, and establish Gwadar as a regional hub. They invited third parties to join, signalling an expansionist intent. For India, this development reinforces the urgency of Chabahar as a counterweight. Unlike Gwadar, Chabahar’s multilateral governance structure grants it greater autonomy and sustainability, while also serving as a platform for Iran’s economic diplomacy and India’s outreach to Central Asia.

For India, Chabahar is not merely an infrastructure project but a statement of strategic autonomy. It reduces dependence on Pakistan, strengthens ties with Iran, and embeds India in Eurasian integration. For China and Pakistan, Gwadar is a linchpin of their partnership, offering Beijing a western gateway and Islamabad a symbol of strategic relevance. The competition between these ports is thus emblematic of the larger struggle for influence across South and Central Asia.

Modi’s SCO address also hinted at a broader conceptual shift: the idea of “regional economic security.” He argued that true stability cannot be achieved through military means alone but must emerge from sustained economic cooperation. This vision aligns with India’s pursuit of connectivity projects that foster mutual dependence, reduce tensions, and create shared prosperity. Chabahar, in this sense, is both a physical port and a metaphor for India’s approach, anchoring security in economic interdependence rather than confrontation.

India’s maritime diplomacy further reflects this orientation. New discussions with Oman to expand engagement in its port sector highlight New Delhi’s intent to diversify partnerships in the Gulf. By leveraging historical ties, India seeks to build resilient supply chains and secure alternative routes amid disruptions caused by the West Asia conflict. The fragility of chokepoints like Hormuz and Suez has already been exposed, reinforcing the need for diversified corridors.

At Bishkek, Modi’s words that wars must be resolved through dialogue, his call to dismantle the ecosystem of terrorism, and his emphasis on sovereignty in connectivity projects carried a resonance that went beyond diplomacy, into a coherent vision.

The conflicts in the Middle East, which have disrupted supply chains and exposed the fragility of traditional routes, have starkly underscored the urgency of building resilient, alternative pathways for regional integration and economic security. Ideally could Chabahar, CPEC, IMEC, and India’s maritime partnerships transcend their current status as isolated initiatives to form interconnected strands of a larger strategy, one capable of securing India’s place in Eurasia’s evolving order while resisting simultaneous pressures from Washington and Beijing? The operational closures and security threats in established connectivity corridors certainly demands it. The search for viable corridors is not India’s alone; it reverberates across all participating states.

Ultimately, India’s SCO position reflects a dual challenge, managing external constraints while advancing internal imperatives. US sanctions complicate Chabahar, Chinese expansionism drives Gwadar, and regional conflicts obstruct IMEC. Modi’s articulation of security, connectivity, and opportunity as pillars of India’s vision signals resilience. By weaving economic cooperation into the fabric of regional security, India seeks not only to safeguard its interests but to shape the trajectory of Eurasian integration.

The author is a security and economic affairs analyst