Pipeline Politics in South Asia

Iran warns India against pipeline deal delay
Dawn, September 17, 2007

TEHRAN, Sept 16: Iran on Sunday expressed impatience with India over the finalising of a multi-billion dollar gas pipeline deal, warning that it could go ahead with the project with Pakistan alone if India procrastinated.

Caretaker Oil Minister Gholam Hossein Nozari said New Delhi and Islamabad were still in discussions over the payment of transit fees by India to Pakistan for Iranian gas from the so-called “peace pipeline”.

He said Pakistani officials were certain to come to Iran next week for talks to finalise the project but the attendance of Indian representatives was still unconfirmed.

“Our preference is to have a tripartite negotiation. (But) the trend is moving faster with the Pakistanis,” Nozari told reporters.

“The Pakistanis and Indians are having discussions on the transit fees. If we believe that a serious delay has occurred with the Indians, we will go ahead with the Pakistanis.” Nozari did not elaborate over whether this could involve Iran signing the finalisation for the deal with Pakistan alone.

The Iranian envoy to the pipeline project, Hojatollah Ghanimifar said according to state media: “We have invited the Indians for these negotiations but so far their presence is not definite.”

Discussions on the 7.4-billion-dollar project started in 1994, but have been held up by technical and commercial issues.

There have also been strong objections to the pipeline from the United States -- a key friend of Pakistan and an ever closer ally of India -- which is at loggerheads with Iran over its contested nuclear programme.

The 2,600-kilometre (1,600-mile) pipeline from Iran’s giant South Pars gas field will initially carry around 60 million standard cubic metres per day of gas.

India, which imports more than 70 per cent of its energy needs, has been racing to secure new supplies of oil and gas from abroad besides ramping up production from domestic sources to sustain its scorching economic growth.

Pakistan will itself receive gas as well as transporting India’s share. India will pay Pakistan for the cost of shipping its share of the gas to the Indian border.

Iran has the world’s second largest gas reserves after Russia but until now has remained a relatively minor player in the global export market.—AFP