Iran is currently working with Pakistan to create a rail link to India. In the meantime, India is shipping through the Bandar Abbas port in Iran.
You skip the horn of Africa, you bypass the Suez Canal, you bypass sailing around Europe completely (there is an Armenian rail link in the works to Eastern Europe).
The Kazakhstan-Turkmenistan-Iran railway connects with the rest of the Russian rail network via the Volga Railway at Astrakhan. So the rail line from the port of Bandar Abbas on Iran's southern coast to the Russian rail network is completed.
The Russian rail network already connects to China, but China has already built 2 train lines to the Indian border and plans to connect to India, Nepal and Butan by 2020.(a far shorter route) China said these trains will travel at 120 km per hour.
The new Berlin-Baghdad Railway?
Notwithstanding the U.S. pressure to scale down its engagement with Iran, official sources here said the country not only remains an important source of oil for India, but is crucial to opening up routes to Central Asian and Caucasian countries, where New Delhi's quest for hydrocarbons and minerals is gathering critical mass.
“We recognise that Iran is the key to connecting with Central Asia,” said the sources while referring to a major meeting last month on a proposed Russia-Iran-India promoted North-South corridor that would originate from Bandar Abbas leading to Russia and other countries via the Caspian Sea.
India has “taken the lead” and is “pushing hard” to put the missing rail links in place so that a seamless route from Bandar Abbas port to Russia and Central Asia opens up by next year by when the customs union of Russia-Kazakhstan-Byelorussia would have expanded to include other Eurasian countries.
Customs procedures
Besides the three original signatories, over 15 countries have joined the north-south project. In addition to putting in place missing railways links of about 200 km, all the sides will have to harmonise their customs procedures to make the endeavour workable. Currently Indian goods enter Russia through the Baltic ports of St. Petersburg and Kotka, the European port of Rotterdam and the Ukrainian ports of Illychevsk and Odessa.
Iran, said the sources, was also critical to stabilising Afghanistan as part of the Shanghai Cooperation Organisation (SCO) grouping after the NATO forces scale down their operations in 2014. Nearly all the countries surrounding Afghanistan are either members or observers to the SCO and they said, “we take it [the SCO] as an important platform to discuss the post-2014 situation in Afghanistan.”
link
In 1888, the Oriental Railway from Austria, across the Balkans via Belgrade, Sofia, to Constantinople, was opened. This linked with the railways of Austria-Hungary and other European countries and put the Ottoman capital in direct communication with Vienna, Paris, and Berlin. It was to be significant for later events.
The Sultan, Abdul Hamid II, on November 27, 1899, awarded Deutsche Bank, headed by Georg von Siemens, a concession for a railway from Konia to Baghdad and to the Persian Gulf. In 1888 and again in 1893, the Sultan had assured the Anatolian Railway Company that it should have priority in the construction of any railway to Baghdad. On the strength of that assurance, the Anatolian Company had conducted expensive surveys of the proposed line. As part of the railway concession, the shrewd negotiators of the Deutsche Bank, led by Karl Helfferich, negotiated subsurface mineral rights twenty kilometers to either side of the proposed Baghdad Railway line.[22] Deutsche Bank and the German government backing them made certain that included the sole rights to any petroleum which might be found. The Germans had scored a strategic coup over the British, or so it seemed. Mesopotamian oil secured through completion of the Berlin-Baghdad Railway was to be Germany’s secure source to enter the emerging era of oil-driven transport.
A German-built rail link to Baghdad and on to the Persian Gulf, capable of carrying military troops and munitions, was a strategic threat to the British oil resources of Persia. Persian oil was the first crucial source of secure British petroleum for the Navy.
Turkey, backed and trained by Germany, had the potential, should it get the financial and military means, to launch a military attack on what had become vital British interests in Suez, the Persian route to India, the Dardanelles. By 1903 the German Reich was prepared to give the Sultan that means in the form of the Baghdad Railway and German investment in Ottoman Anatolia.
By 1913 that German engagement had taken on an added dimension with a German-Turkish Military Agreement under which German General Liman von Sanders, member of the German Supreme War Council, with personal approval of the Kaiser, was sent to Constantinople to reorganize the Turkish army on the lines of the legendary German General Staff. In a letter to Chancellor von Bethmann-Hollweg, dated April 26, 1913, Freiherr von Wangenheim, the German Ambassador to Constantinople declared, “The Power which controls the Army will always be the strongest one in Turkey. No Government hostile to Germany will be able to hold on to power if the Army is controlled by us…” [25].
As well in Serbia British military and intelligence networks were most active prior to outbreak of war. Major R.G.D. Laffan was in charge of a British military training mission in Serbia just before the war. Following the war, Laffan wrote of the British role in throwing a huge block on the route of the German-Baghdad project:
"If 'Berlin-Baghdad' were achieved, a huge block of territory producing every kind of economic wealth, and unassailable by sea-power would be united under German authority," warned R.G.D. Laffan. Laffan was at that time a senior British military adviser attached to the Serbian Army.
"Russia would be cut off by this barrier from her western friends, Great Britain and France," Laffan added. "German and Turkish armies would be within easy striking distance of our Egyptian interests, and from the Persian Gulf, our Indian Empire would be threatened. The port of Alexandretta and the control of the Dardanelles would soon give Germany enormous naval power in the Mediterranean."
Laffan suggested a British strategy to sabotage the Berlin-Baghdad link. "A glance at the map of the world will show how the chain of States stretched from Berlin to Baghdad. The German Empire, the Austro-Hungarian Empire, Bulgaria, Turkey. One little strip of territory alone blocked the way and prevented the two ends of the chain from being linked together. That little strip was Serbia. Serbia stood small but defiant between Germany and the great ports of Constantinople and Salonika, holding the Gate of the East...Serbia was really the first line of defense of our eastern possessions. If she were crushed or enticed into the 'Berlin-Baghdad' system, then our vast but slightly defended empire would soon have felt the shock of Germany's eastward thrust."
British intelligence thus instigated the assasination Of Austro-Hungarian heir to the throne, Archduke Franz Ferdinand by the Serbian Black Hand with the assistance of the Serbian Government in the hopes that it would incite Austria-Hungary to attack Serbia and break the rail link between Berlin and the Middle East.
link
"If 'Berlin-Baghdad' were achieved, a huge block of territory producing every kind of economic wealth, and unassailable by sea-power would be united under German authority," warned R.G.D. Laffan.
The North-South Transport Corridor does the same under SCO authority.
Turkey is of special interest because it has been a long-standing NATO member. It had hoped to join the EU but it became clear that this was never going to happen. Instead under the leadership of Recep Erdoğan Turkey is moving towards the SCO.
Erdoğan was re-elected earlier this month by a comfortable majority and it will be interesting to see how quickly Turkey's new alignment evolves. Erdoğan must be aware that Asia is on the up while the EU declines, in which case Turkey as a front-line state is better off joining the SCO.
The SCO's influence extends beyond its boundaries, with China and India's diasporas populating much of the rest of south-east Asia. SCO members, particularly China and India, are also the largest consumers of Middle Eastern energy. And because they write the biggest cheques they have primacy over the west; so the swing away from the petro-dollar towards Asia is in the making. China also has sub-Saharan Africa sewn up, securing vital minerals such as copper from Zambia.
We must also consider why Russia is aggressively driving the pace of the SCO's development, and it's not just to escape the west's economic sanctions as many observers think. Fundamentally the SCO is about resources and the production of goods: Russia controls Asia's resources and China turns them into goods.
One of the first persons to identify the geopolitical importance of Russia's resources was Halford Mackinder in a paper for the Royal Geographical Society in 1904. He later developed it into his Heartland Theory. Mackinder argued that control of the Heartland, which stretched from the Volga to the Yangtze, would control the "World-Island", which was his term for Europe, Asia and Africa. Over a century later, Mackinder's theory resonates with the SCO.
The underlying point is that North and South America, Britain, Japan and Australasia in the final analysis are less important than Mackinder's World-Island. There was a time when British and then American primacy outweighed its importance, but this is no longer true. If Mackinder's theory is right about the overriding importance of undeveloped resources, Russia with the backing of the SCO's members is positioned to become the most powerful nation on earth.
The SCO is the greatest challenge yet mounted to American economic power, and Russia and China are clearly determined to ditch the dollar. We don't yet know what will replace it. However, the fact that the Central Bank of Russia and nearly all the other central banks and governments in the SCO have been increasing their gold reserves could be an important clue as to how the representatives of 3 billion Euro-Asians see the future of trans-Asian money.
link
Gazprom to take payments only in Rubles or Yuan
Several months ago, when Russia announced the much anticipated "Holy Grail" energy deal with China, some were disappointed that despite this symbolic agreement meant to break the petrodollar's stranglehold on the rest of the world, neither Russia nor China announced payment terms to be in anything but dollars. In doing so they admitted that while both nations are eager to move away from a US Dollar reserve currency, neither is yet able to provide an alternative.
This changed in late June when first Gazprom's CFO announced the gas giant was ready to settle China contracts in Yuan or Rubles, and at the same time the People's Bank of China announced that its Assistant Governor Jin Qi and Russian central bank Deputy Chairman Dmitry Skobelkin held a meeting in which they discussed cooperating on project and trade financing using local currencies. The meeting discussed cooperation in bank card, insurance and financial supervision sectors.
And yet, while both sides declared their operational readiness and eagerness to bypass the dollar entirely, such plans remained purely in the arena of monetary foreplay and the long awaited first shot across the Petrodollar bow was absent.
Until now.
According to Russia's RIA Novosti, citing business daily Kommersant, Gazprom Neft has agreed to export 80,000 tons of oil from Novoportovskoye field in the Arctic; it will accept payment in rubles, and will also deliver oil via the Eastern Siberia-Pacific Ocean pipeline (ESPO), accepting payment in Chinese yuan for the transfers. Meaning Russia will export energy to either Europe or China, and receive payment in either Rubles or Yuan, in effect making the two currencies equivalent as far as the Eurasian axis is conerned, but most importantly, transact completely away from the US dollar thus, finally putin'(sic) in action the move for a Petrodollar-free world.
More on this long awaited first nail in the petrodollar coffin from RIA:
The Russian government and several of the country’s largest exporters have widely discussed the possibility of accepting payments in rubles for oil exports. Last week, Russia began to ship oil from the Novoportovskoye field to Europe by sea. Two oil tankers are expected to arrive in Europe in September.
According to Kommersant, the payment for these shipments will be received in rubles.
Gazprom Neft will not only accept payments in rubles; subsequent transfers via the ESPO may be paid for in yuan, the newspaper reported.
According to the newspaper, the change in currency was made because of the Western sanctions against Russia.
As a protective measure, Russia decided to avoid taking its payments in US dollars, which can be tracked and controlled by the United States government, Kommersant reported.
"Protective measure" meaning that it was the US which managed to Plaxico itself by pushing Russia to transact away from the US Dollar, in the process showing the world it can be done, and slamming the first nail in the petrodollar's coffin.
link
Modi has taken to the BRICS like fish to water, which surprised most Indian observers who were visualising that the interest groups most vociferously backing his candidature in the parliamentary poll in April would expect him to follow a 'pro-American' foreign policy, driven also by the craving to adopt a muscular approach to India's problematic relationships with China and Pakistan.
However, Modi's meetings on the sidelines of the BRICS summit with Xi and Russian President Vladimir Putin brought out his conviction that India's long-term interests are best served by forging closer strategic partnerships with these two world powers.
Again, most expectedly, instead of beating war drums, Modi let loose peace doves into the South Asian skies.
And, least of all, came his audacious decision to demand that Delhi cannot ratify the World Trade Organisation's so-called trade facilitation agreement if it jeopardised India's food security.
India still remembers a time when it's food was loaded on ships bound for Britain while it's dockworkers died of starvation.
Suffice to say, Modi supported the emergence of the BRICS development bank with great deliberation, knowing fully well that such a move challenges the dominance of the US dollar in the world economy and will seriously undermine the Bretton Woods system that provided a vital underpinning for the advancement and preservation of the United States' global hegemony for the past several decades.
It is entirely conceivable that at some point sooner rather than later the SCO countries may move toward trading in their national currencies, creating banking institutions to fund intra-regional projects and forming preferential trade regimes.
link
China Launches AIIB to Rival World Bank Without US Allies After Pressure from Washington
Representatives of 21 Asian nations have convened in Beijing to inaugurate the Asian Infrastructure Investment Bank (AIIB), seen by some as a regional rival to the World Bank.
The Chinese-led initiative will be capitalised with $50bn (£31bn, €39.5bn), which will finance infrastructure projects within the region. China is set to put up half the capital required.
The countries present at the signing ceremony were: Bangladesh, Brunei, Cambodia, China, India, Kazakhstan, Kuwait, Laos, Malaysia, Mongolia, Myanmar, Nepal, Oman, Pakistan, the Philippines, Qatar, Singapore, Sri Lanka, Thailand, Uzbekistan, and Vietnam.
The Chinese Finance Minister described the AIIB as "an open and inclusive institution". It will be headquartered in Beijing.
Notable absentees from the signing ceremony were the United States' closest regional allies, Japan, South Korea, and Australia, with media reports claiming the US had exerted pressure on the countries not to join up.
China is also the driving force behind the New Development Bank - known colloquially as the BRICS Bank, after its member nations Brazil, Russia, India, China, and South Africa - which is also set to fund infrastructure projects to the tune of $50bn, with that capitalisation set to rise to $100bn.
It's a commonly held view that China will attempt to use the bank to extend its political influence. In Africa, it has often been criticised for building roads in exchange for access to commodities. According to analysts, the AIIB could be used as a tool to bolster Chinese allegiances as it attempts to usurp the US as the dominant power in the region.
link
A clear view of the 'grand game' taking place is necessary to understand what is going on in the world, including knowing who the opposing parties are.
This is a struggle between the Western Elite, the IMF and the World Bank, and what is shaping up to be, the rest of the world.
The number of defections to the other side is astounding. Did you notice Kuwait, Oman and Qatar on the list of members of the AIIB?
Vibrant trade and infrastructure win out against 'austerity' and abject poverty every time.
The Western Plutocracy maintained power by ensuring there were no alternatives. Backed up by Western military power. The alternative that exists now is so bright, it is drawing nations like moths to a flame. And Russia/China together can easily counter the Western military threat. The bullies that had been terrorizing the planet have been neutralized, and though not totally gone yet, on the way out.
Unfortunately for the American people, it will take much more to achieve their freedom from these Gangsters.
The economic power is shifting to the East.