Iran: India Eager to Partner IPI Gas Project

A02243604.jpgTEHRAN (FNA)- India is keen to partner the proposed multi-billion Iran-Pakistan-India (IPI) gas pipeline project and has promised to resist “all external pressures on the issue”, Iranian Oil Minister Gholam Hossein Nozari said.

“Indian officials have voiced interest in the project and stated that no external power can influence them,” Nozari said on Tuesday.

He noted that India has emphasized on its participation in the project throughout all of its official declarations.

Iran has sent a letter to Pakistan asserting that the export of gas to India through the pipeline is of paramount importance for the country, the minister said.

The Indian Petroleum Minister Murli Deora is set to arrive in Pakistan on April 21 to hold talks on transit fee to be paid to Islamabad on the USD seven billion IPI project.

Indian Petroleum Minister Murli Deora on Saturday said that he would discuss Iran-Pakistan-India gas pipeline project with Pakistani and Iranian officials on April 23 in Islamabad.

Although Pakistan and Iran have finalized Gas Sales Purchase Agreement (GSPA) on the project, India stayed away from talks saying that it wanted to resolve the issue of transit fee first.

The IPI project is a proposed 2,775 km pipeline to carry Iran’s natural gas to Pakistan and India. The project, estimated to be completed in three to five years time, is expected to benefit energy-starved India and Pakistan.

Thus, India and Pakistan are trying to resolve their difference by cooperating on a pipeline that would bring natural gas from Iran through Pakistan to India. It is economically necessary, environmentally friendly and security enhancing.

During the forthcoming meeting, New Delhi and Islamabad will strive to sort out the issue of transit fee India should pay to Pakistan for transferring gas through the latter’s territory.

According to Indian ministry sources, the IPI gas pipeline is quite crucial for New Delhi as after signing of the agreement, 60 million standard cubic meters per day (mmscmd) of gas is expected to be supplied in phase-I, which will be shared equally between India and Pakistan.

In phase-II, 90 mmscmd of gas will be supplied to India and Pakistan. So far six meetings of the trilateral joint working group (JWG) of the participating countries have been held with the last meeting being held in New Delhi on June 28-29, 2007.

India, Asia’s third-largest economy, can produce only half the gas it needs to generate electricity, causing blackouts and curbing economic growth. Demand may more than double to 400 million cubic meters a day by 2025 if the economy grows at the projected rate of 7 to 8 percent a year, according to the Indian oil ministry.

The $7.4 billion project stalled because India couldn’t agree with Islamabad on the fees it will pay Pakistan for transporting the fuel. The 2,100-kilometer (1,305- mile) pipeline was shelved when the nuclear-armed neighbors came to the brink of war after a terrorist attack on India’s parliament in 2001.

Talks are more likely to progress after Pakistan elected Yousuf Raza Gillani as its new prime minister this week, ending six months of political instability that culminated with the suspension of the constitution in November and the assassination of former Prime Minister Benazir Bhutto in December.

Iran, which has the world’s second-largest oil and natural gas reserves, agreed to sell gas to India in 1995.

Iran plans to start exporting gas to Pakistan in 2011. Iran has completed half the pipeline, which can carry 110 million cubic meters of gas a day, National Iranian Gas Company (NIOC) said this month. India uses about 108 million cubic meters of gas a day, according to a BP Plc report.

The US, seeking to isolate Iran because of its pursuit of nuclear rights, had wanted the project scrapped, although Deora said the US is not opposed to the project.

“The Americans have not told us in clear terms that you should not support or go ahead with this pipeline project,” Deora said. “They are our largest trading partner. But that does not mean they can bully us on where to buy and where not to buy.”

The US is at loggerheads with Iran over Tehran’s independent and home-grown nuclear technology. Washington has laid much pressure on Iran to make it give up the most sensitive and advanced part of the technology, which is uranium enrichment, a process used for producing nuclear fuel for power plants.

Washington’s push for additional UN penalties contradicted the recent report by 16 US intelligence bodies that endorsed the civilian nature of Iran’s programs. Following the US National Intelligence Estimate (NIE) and similar reports by the IAEA head – one in November and the other one in February – which praised Iran’s truthfulness about key aspects of its past nuclear activities and announced settlement of outstanding issues with Tehran, any effort to impose further sanctions on Iran seemed to be completely irrational.

The February report by the UN nuclear watchdog, the International Atomic Energy Agency, praised Iran’s cooperation in clearing up all of the past questions over its nuclear program, vindicating Iran’s nuclear program and leaving no justification for any new UN sanctions.

Tehran says it never worked on atomic weapons and wants to enrich uranium merely for civilian purposes, including generation of electricity, a claim substantiated by the NIE and IAEA reports.

Iran has insisted it would continue enriching uranium because it needs to provide fuel to a 300-megawatt light-water reactor it is building in the southwestern town of Darkhoveyn as well as its first nuclear power plant in the southern port city of Bushehr.

Not only many Iranian officials, including President Mahmoud Ahmadinejad, but also many other world nations have called the UN Security Council pressure unjustified, especially in the wake of recent IAEA reports saying Iran had increased cooperation with the agency.

US President George W. Bush, who finished a tour of the Middle East in winter, has called on his Arab allies to unite against Iran.

But hosting officials of the regional nations dismissed Bush’s allegations, describing Tehran as a good friend of their countries.

Bush’s attempt to rally international pressure against Iran has lost steam due to the growing international vigilance, specially following the latest IAEA and US intelligence reports.

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