TEHRAN: Iranian President Hassan Rouhani, Indian Prime Minister Narendra Modi and Afghan President Ashraf Ghani on Monday signed a three-way transit agreement on Iran's southern port of Chabahar.

India said it will invest up to $500 million in a deal to develop a strategic port in Iran and both countries planned a number of projects they say are worth hundreds of millions of dollars.

“Today is an important and historical day of development of relations between the three countries,” Rouhani said in a televised speech, seated between the two other leaders.

“From Tehran, New Delhi and Kabul, this is a crucial message ... that the path to progress for regional countries goes through joint cooperation and utilising regional opportunities."

Modi said: “We want to link to the world, but connectivity among ourselves is also a priority.”

“Our will starts from Chabahar today, but its end will be an all-out comprehensive development and economic-cultural cooperation,” said Ghani.

The deal and plans were announced during a visit by Indian Prime Minister Narendra Modi, the first such trip in more than a decade.

In a ceremony marking the agreements, Modi said the bilateral agreement to develop Chabahar, in southern Iran, and the “availability of about $500 million from India for this purpose is an important milestone,” in relations between the two countries.

The development of the port of Chabahar expands a trade route for the land-locked countries of central Asia that bypasses Pakistan.

Modi also described cooperation in the oil and gas industries as key components of economic cooperation between Tehran and Delhi.

Iran President Hassan Rouhani said working on the port can be a “great symbol” of cooperation between Iran and India. He said Iran's energy resources and Indian mines can pave ground for cooperation in the aluminum, steel and petrochemical industries.

The two leaders will discuss the port project later with visiting Afghan President Ashraf Ghani. Modi will also meet Iran's Supreme Leader Ayatollah Ali Khamenei.

The two countries also signed a number of agreements to enhance technological, petrochemical and banking cooperation. India also began paying back $6 billion in debt from past oil purchases, last week giving Iran $750 million.

It has said it will pay back the remainder of the debt. In 2012, Iran was India's second-largest crude supplier but oil exports subsequently fell due to international sanctions over Iran's disputed nuclear program.

Tehran has been seeking to reintegrate into the global economic system following a landmark deal with world powers that lifted sanctions in return for limiting its nuclear program.