Context: Russian and Iran signed a deal to finance and build an Iranian railway line as part of an embryonic international North–South Transport Corridor.

Rasht-Astara railway Project

• The Rasht-Astara railway is seen as an important link in the international North–South Transport Corridor, intended to connect India, Iran, Russia, Azerbaijan and other countries via railways and sea - a route that Russia says can rival the Suez Canal as a major global trade route.

• The 162 km (100 mile) railway along the Caspian Sea coast would help to connect Russian ports on the Baltic Sea with Iranian ports in the Indian Ocean and the Gulf.

North–South Transport Corridor

• Length: 7 200 km-long-project

• The foundation of the ‘North-South Transport Corridor’ was laid on the basis of an intergovernmental agreement signed between Russia, Iran, and India on September 12, 2000.

• In total, 13 countries have ratified the agreement, including Belarus, Ukraine, Russia, Azerbaijan, Armenia, Turkey, Syria, Iran, Oman, India, Kazakhstan, Kyrgyzstan, and Tajikistan. Bulgaria is an observer nation.

Rival to Suez Canal

• The Rasht-Astara railway is a route that Russia says can rival the Suez Canal as a major global trade route.

Background

• Russia and Iran have been pushed to strengthen their political and economic ties by Western economic sanctions on each, which both say are unjustified.

• Since the 1979 Islamic Revolution, Iran has been ostracised by the West and its economy crippled by a myriad of sanctions.

• It holds around a quarter of the Middle East's oil reserves.

• The West also imposed other set of restrictions over Iran's nuclear program

• Russia was sanctioned due to its actions in Ukraine.