TIME:

Indian Prime Minister Narendra Modi concluded a two-day visit to Iran by signing a raft of agreements Monday, including two key deals that will likely enable him to circumvent contentious neighbor and regional rival Pakistan — thereby establishing a crucial economic and strategic pathway toward the rest of the world.

The most noteworthy of the 12 agreements signed between Modi and Iranian President Hassan Rouhani is India’s investment of $500 million into developing Iran’s Chabahar port, considered an important entrepôt leading to Afghanistan and onward to Central Asia. Afghan President Ashraf Ghani also later joined the two leaders to sign a trilateral transit agreement that will significantly ease the passage of goods between the three countries and boost trade.

“The main significance is the explicit connection of this project to Afghanistan’s future economy and stability. In that sense, the presence of Afghan President Ghani in Tehran was very important,” Dhruva Jaishankar, a fellow for foreign policy at Brookings India, tells TIME, adding that the political importance being given to the Chabahar project makes it clear that it is “not just any commercial deal.”

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Modi’s visit to Tehran is the first by an Indian Prime Minister in 15 years, with both countries keen to capitalize on the lifting of U.S. sanctions last year — the sanctions had led to a partial deterioration of their previously cooperative relations. India is one of the largest importers of Iranian crude oil but built up a $6.5 billion backlog of payments during the sanctions. India’s role in the global condemnation of Iran’s nuclear program also soured the bilateral relationship...

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