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India and Russia forging ahead with cargo rail link

India and Russia are forging ahead with a planned rail link that transits through Iran.

The warmth displayed by the US during President Donald Trump’s recent visit has not deterred India from taking a step forward in using surface transport infrastructure to connect with Russia much faster through Iran, a country in the spotlight for facing US-sponsored sanctions.

“Within three months, traders from India and Russia could move goods between the two countries through Iran,” said V Kalyana Rama, chairman and managing director of the state-owned Container Corporation of India (Concor).

This follows a service agreement between Concor and RZD Logistics JSC (a subsidiary of Russian Railways) to transport cargo between India and Russia, using a single invoice. The two entities had signed an MoU last year to this effect.

The move will benefit exporters and importers between India and Russia by lowering transit time and cost of transportation compared to existing transportation via the Suez Canal.

The new route will cut time of moving goods sharply (to 25-28 days from about 40 days) as it will avoid the present circuitous sea route through the Suez Canal, and also result in significant cost savings.

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