Iran Moves to Position Itself as Central Asia's Trade Path

Article excerpt

THE dusty town of Sarakhs, straddling the border between Iran and Turkmenistan, has long been isolated from the rest of the world by distance and desert. By next March, however, it could become a bustling center of commerce, if plans formulated by the Iranian government are successful.

Amid the jagged mountains and clumps of pistachio bushes in the surrounding desert, hundreds of Iranian engineers and laborers are already building the first phase of a vast business center, one of several free-trade zones under construction along the country's northern border.

This effort is part of Iran's gambit to position itself as a trade gateway to the new Muslim states in Central Asia, formed after the Soviet Union's breakup.

"Iran is helping to open untapped markets in Central Asia," says Iraj Kazemian, project consultant for the Sarakhs Special Zone Establishment. "These republics are developing fast. The people there are crying out for consumer goods. And when the {planned rail} route is established, all the trade between India and Europe will come through Sarakhs." This may be over-optimistic, but the Indian government is said to be interested in the Sarakhs venture.

Mr. Kazemian describes the project as "immense."

"We're converting a small airport into an international cargo hub," he says. "We're providing accommodation for 50,000 businesspeople, and we're even building a dam to provide water."

Such ambitious planning is common in Iran, and many projects never get off the drawing board. But this scheme is guided by Astan Qods Razavi, the Foundation of the Holy Shrine of Imam Reza, a $40 billion religious organization with nearly 60 companies and a reputation for results.

Since the Soviet collapse in 1991, analysts have speculated about the future of the southern former Soviet republics, the Muslim states of Turkmenistan, Kazakstan, Uzbekistan, Kyrgyzstan, Tajikistan, and Azerbaijan. Several of the republics are land-locked and, for many decades, have depended on Russia for access to the outside world.

IRAN, along with Turkey and Pakistan, rushed to offer alternative access to Central Asia, each believing it could dominate the region and benefit from increased trade. The three countries reactivated the long-defunct Economic Cooperation Organization (ECO) trading group and extended it to include Afghanistan and the six new Muslim republics. …