The Indian government has allocated $13.9 million for the development of the strategic Chabahar Port in southeast Iran, according to India’s Hindustan Times.

India’s decision to more than double the outlay for developing the strategic Chabahar port in Iran in fiscal year 2020-21 signals the “government’s determination to push ahead” with the project after a “clear signal” from the US that it won’t be affected by sanctions, the report said.

The budget for the external affairs ministry unveiled on Saturday.

People familiar with developments said the delay was largely due to the reluctance of Indian and foreign firms to get involved in the development of Chabahar due to the potential impact of US sanctions imposed on Iran in 2018, the report said.

Iran, India and Afghanistan had signed a trilateral agreement to develop Chabahar in May 2016 during the visit of Prime Minister Narendra Modi and Afghan President Ashraf Ghani to Tehran.

On December 25, 2019, the United States gave written assurance to India that it would help facilitate global banks to fund the purchase of equipment worth $85 million to be established at Chabahar Port.