February 26, 2010

IPI Pipeline yes, Dictation from any country No!

Iran and Pakistan have signed a gas sales and purchase agreement in June last year under which Islamabad will purchase at least 750 million cubic feet of gas a day from the Southern Pars gas field. The agreement has a provision that the volume of gas supplies can be increased to one BCFD.

The two countries have resolved almost all other issues pertaining to the gas pipeline project, including pricing of gas, project details and quantity of gas to be purchased.

Work on the project can be undertaken immediately if Iran does not insist much on the guarantee that Iran seeking to ensure uninterrupted gas supplies to India through the pipeline. India has been in discussions with Iran on joining the project and has participated in several trilateral meetings.

According to informed sources Iran was pursuing Pakistan for a performance guarantee regarding gas deliveries if India decided to become part of the project. This will require Pakistan to pay penalties to India for any disruption in gas supplies to India. Pakistan would be liable to penalties even in case of sabotage or war between the two countries.

However, Pakistan is ready to put in all security measures required to protect the pipeline within its territory but it cannot pay the price for gas disruption when its own security is “threatened by India” or due to any sabotage activity.

Notwithstanding Pakistan has decided not to give any sort of guarantee for ensuring uninterrupted gas supplies via Pakistan to India carried by a proposed multi-billion dollar pipeline project originating from Iran. Pakistan has already informed to Iran that a friendly project between two neighborly Muslim countries should not be allowed to be affected only because of the interests of a third country. Keeping in view of a chequered history between India and Pakistan Iran should not press Pakistan to become a guarantor for an uninterrupted gas supply to India which has never shown a soft corner for Pakistan.

Pakistan defense authorities too have objected over the proposal of providing iron-clad sovereign guarantees to India for gas supplies through the pipeline. Pakistan needed gas from Iran to meet its growing energy needs but it could not compromise on its long-term national interests especially in the face of stalled progress for addressing the longstanding issues with India.

-Published in January 2010, MOBILE WORLD Magazine

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