During a meeting between External Affairs Minister Salman Khurshid and his Iranian counterpart Ali Akbar Salehi under the framework of Joint Commission, the two sides agreed to work on a trilateral transit agreement involving India, Iran and Afghanistan.
But it was underlined that the work on the draft agreement should be started soon.
The two sides also discussed ways to enhance trade relations and people to people contact, regarding which the need was felt for liberalising the visa regime.
As a follow up, India's Secretary, Ministry of Shipping, will travel to Tehran for negotiations on cost and other aspects.
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The Iranian side underlined that the project is important not only for Iran and Afghanistan but for entire central Asia.
The two sides also reviewed the progress on the proposed North-South corridor which will link Russia with Iran, with Khurshid saying that any obstructions or any hurdles should be resolved.