Oil

Iran-Pakistan-India: Laying the ‘Peace Pipeline’

International Affairs, Public Policy
Update: October 2, 2008
Iran and Pakistan have decided to go through with the Pipeline without India (Link 1, Link 2)

A Natural Gas Pipeline that will connect these three critical nations.
Iran, Pakistan, and India, collectively known as the IPI, are very close to finalizing the ‘Peace Pipeline’ plan that would drop a critical natural gas supply line that would run through the three neighboring countries. As always, there is a catch (or several) – and India is weary of signing on because of the Price Revision Clause being imposed by Iran that would base the price of the natural gas on a formula that utilizes Japan’s gas market as a benchmark. Nevertheless, India’s participation in the ‘Peace Pipeline’ doesn’t seem to matter as much to Iran and Pakistan as they continue bilateral talks that suggest India’s role as merely an added bonus that would sweeten the deal. Pakistan’s ambassador to Iran, Shafkat Saeed, insists that if India rejects the terms of the deal, the oil will be routed through China instead.

�We have informed Iran that we are prepared to transfer Iran�s gas to China through this pipeline should India decide not to join the gas project.� [ Associated Press of Pakistan, Oct 2007 ]

Though India has assured that it will take part in the TAPI (Turkmenistan-Afghanistan-Pakistan-India) gas pipeline – it is clear that the TAPI pipeline is not a replacement for the Iran-Pakistan-India pipeline, and their lack of an absolute decision in light of U.S. pressure is proof that the IPI pipeline stands to bring benefit to the Indian economy. Continue reading …