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China may replace India in IPI project

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Iran, Pakistan dump India on pipeline
By Siddharth Srivastava

NEW DELHI - Even as New Delhi grapples with domestic leftwing opposition to the India-United States civilian nuclear deal, Iran and Pakistan have finalized their section of a US$7.5 billion gas pipeline that Washington opposes.

India, Pakistan and Iran are the original partners of the 2,700-kilometer IPI "peace" pipeline that they wanted to complete by 2012 to transfer Iranian natural gas from its South Pars field to India via Pakistan. But, it is apparent now that New Delhi has been dumped, for the time being at least.

Last week, Iran's deputy minister in charge of the pipeline, Hojatollah Ganimifard, was quoted by the Iranian Oil Ministry's news service Shana as saying, "The content of the peace pipeline contract has been finalized and all the points prepared by the two sides' legal experts have been re-read and agreed by the two sides [Iran and Pakistan]." He said the two sides would ink the contract in December "without a third partner".

And this week, Mokhtar Ahmad, advisor to Pakistani Prime Minister Shaukat Aziz, was quoted as saying, "As we expected, the text of the peace pipeline has been made ready for the signing by the two states' heads." Pakistan said that any excess gas that would have been destined for India could be transferred to China.

Both Tehran and Islamabad have blamed India of delaying progress of the IPI at the behest of Washington, which does not want nations to deal with Iran due to its bid to pursue an independent nuclear program. Among the issues that New Delhi has raised on the IPI include security guarantees, transit fees it must pay to Pakistan and a price revision clause on which Tehran insists.

New Delhi also did not take part in what was meant to be a tripartite conference in Tehran, saying that it needed to sort out bilateral issues with Pakistan first.

There is a thought that New Delhi feels it can afford to let the IPI slip due to the discovery of huge gas reserves on India's eastern coast, the Krishna-Godavari basin, that private sector behemoth Reliance Industries plans to begin selling soon.

New Delhi has also been unhappy with Tehran reopening price negotiations to a separate liquefied natural gas (LNG)deal signed earlier. India has been looking at Qatar, Algeria and Russia instead to serve its LNG needs.

As an alternative, India is also seriously looking at the prospects of taking natural gas from Turkmenistan via Afghanistan and Pakistan, due to the heavy doses of tax breaks that have been proposed to push this $3.5 billion pipeline project that is supported by the US.

Although publicly New Delhi has maintained that it stands by the IPI pipeline, the reality is going to be different.

"The final deal [on IPI] is not going to happen in the near future as the project is no longer just about energy security, it's more about India's strategic position in the global community," a Foreign Ministry official told Asia Times Online on condition of anonymity.

"The project is in the radar of the Prime Minister's Office and unless there is a clear signal from there, it is unlikely that India's Petroleum Ministry will agree to any final arrangement," he added.

US Treasury Secretary Henry Paulson, during a recent visit to India, is believed to have recommended that Delhi not go ahead with the project. And subsequently Treasury Under Secretary for International Affairs David McCormick told reporters that the US hoped India would not move forward with the pipeline. He said "it would not be the right path during a time the world should be imposing greater discipline on its interactions with Iran". He added that India should meet its energy needs through the nuclear deal with the US that is now stalled in the Indian Parliament.

Russia left out

There are official and media indications that progress in India-Russia nuclear cooperation has also been deliberately delayed, as New Delhi does not want to upset the US.

It was expected that the highlight of Indian Prime Minister Manmohan Singh's visit to Russia this week would be a far-reaching civilian nuclear agreement, with Moscow to help India build four reactors to produce electricity.

But the deal has been deferred as Washington apparently would not have stood for India deepening its nuclear engagement with Russia at a time when the India-US nuclear pact is stalled. If ratified by India and then by the international Nuclear Suppliers' Group (NSG), the latter agreement will allow US companies lucrative access to India's civilian nuclear development programs.

India's official stand is that the NSG still has to debate India's global nuclear status, but this has not prevented New Delhi from dealing with Russia on nuclear matters in the past.

Meanwhile, Washington has also made it clear that Indian private sector major Essar Steel's plans to enter the US's iron and steel sector with a $1.6 billion steel plant in Minnesota will be stymied if the company goes ahead with building a refinery in Iran.

Recently, pension funds from the US, including Calpers (California Public Employees' Retirement System), wrote to global oil companies, including Indian state-explorer Oil and Natural Gas Corporation and the Essar Group, cautioning them about investing in Iran.

The funds have indicated that future international sanctions may jeopardize such operations involving Iran, which is an indicator of stronger US action in the pipeline against Iran.

Siddharth Srivastava is a New Delhi-based journalist.

Asia Times Online :: South Asia news - Iran, Pakistan dump India on pipeline
 

roadrunner

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They'll be back for it. Unless TAP can give them enough.. "At the behest of DC" is interesting. Does the US have that much influence over India?
 

Flintlock

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Iran may not sign gas pipeline pact with Pakistan next week
11 Jan, 2008, 1520 hrs IST, PTI


NEW DELHI: Iran is unlikely to sign next week a bilateral agreement with Pakistan for export of natural gas and has said it was keen on India joining the tri-nation 'peace' pipeline project. "As we speak, there is no ceremony scheduled for signing of Gas Sales Purchase Agreement (GSPA) with Pakistan next week," a senior Iranian official told PTI from Tehran.

While New Delhi has since June 2007 boycotted meetings on the seven billion dollar Iran-Pakistan-India gas pipeline project over the issue of transit fee payable to Islamabad, Iran and Pakistan have held several rounds of discussions and were reported close to signing a bilateral deal. Pakistan's caretaker Petroleum Minister Ahsan Ullah Khan had earlier this week stated that an economic coordination committee of the Pakistani Cabinet had cleared sovereign guarantees for gas imports from Iran and a GSPA with Iran was likely to be signed next week.

"Those are statements made by Pakistan. We haven't said that we are signing a bilateral GSPA. We are very keen that India joins the project," the Iranian official said. "We are proposing a trilateral meeting in New Delhi next month." Industry observers said no country would be comfortable entering into an agreement with Pakistan during its present political turmoil. Iran would like a stable and high demand consumer like India to back the multi-billion dollar revenues it expects to earn every year from sale of natural gas.

Indian officials also said though a bilateral meeting with Pakistan was scheduled to take place in Islamabad on February 14-16 to resolve the transit fee issue, no agreement was likely unless elections take place in that country and a new government is sworn in.

Iran may not sign gas pipeline pact with Pakistan next week- Oil & Gas-Energy-News By Industry-News-The Economic Times
 

UnitedPak

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This is just ridiculous. India is intent on stalling this deal. What exactly are they trying to achieve?
 

Evil Flare

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Reviving this Thread :D

I think now IPI will be rename it to IPC ...

Serious Talks b/w Pakistan & China
 

Black Stone

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Didn't Iran and Pakistan say that they will proceed with the deal and contructions and India could join at a later date?.
 

Neo

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Didn't Iran and Pakistan say that they will proceed with the deal and contructions and India could join at a later date?.
Both countries agreed to go ahead "avec ou sans" India. Its up to her if she wants to join, sofar she's only been delaying the deal.

China came in later in the picture, but IP is going to be build with or without third player.
 

Black Stone

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Both countries agreed to go ahead "avec ou sans" India. Its up to her if she wants to join, sofar she's only been delaying the deal.

China came in later in the picture, but IP is going to be build with or without third player.
According to the article, it says the IPI could be a IPC. The Chinese have been quiet about it. Is there any news from the Pakistan media reporting about whether the Chinese are interested should the Indians drop out?.
 

Neo

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According to the article, it says the IPI could be a IPC. The Chinese have been quiet about it. Is there any news from the Pakistan media reporting about whether the Chinese are interested should the Indians drop out?.
The concept was envissioned by Musharraf when he proposed Pakistan to serve as an energy corridor to China in a $20 billion project.
The concept is being evaluated by both governments on feasibility and might take another decade before final decision is taken. :coffee:
 

dr.umer

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China may replace India in a multi-billion-dollar gas pipeline deal with Iran and Pakistan if New Delhi continues ‘delaying’ the venture.

Pakistan’s Foreign Minister Shah Mahmood Qureshi said on Saturday that Pakistan could not delay the Iran-Pakistan-India (IPI) pipeline project any further due to its growing energy requirements.

“The IPI project can become the IPC (Iran-Pakistan- China) project or even if it is the IP (Iran-Pakistan) project, China can invest in it,” he told reporters in Islamabad after Pakistani President Asif Ali Zardari’s visit to China.

Qureshi added that the pipeline could feed energy-deficient areas in China bordering Pakistan.

China has not yet given any firm commitment on joining the $7.4 billion project, which has been delayed by repeated disputes over prices, transit fees and tensions between India and Pakistan.

Iran and Pakistan have agreed to finalize the deal bilaterally. The US has also tried to persuade India into abandoning the project in order to put pressure on Iran over the country’s nuclear program.

During Iranian Foreign Minister Manouchehr Mottaki’s visit to Pakistan, the two countries agreed to finalize the deal even if India did not join the project.

“As we are not prepared to wait for the third partner, we will proceed bilaterally,” Qureshi said.

“Iran and Pakistan will welcome India (whenever it chooses to join the project), but it has not reached the stage of making a decision,” he said, adding that he would soon visit Tehran to finalize modalities for the venture.


(Source: Press TV)
 

Imran Khan

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sir i read some were because chaina is 4500 feet high thats wht its too expencive to join chaina this project
 
Jun 3, 2007
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sir i read some were because chaina is 4500 feet high thats wht its too expencive to join chaina this project
Dear IK,

You are right. I doubt this pipeline will be feasible without the US backing and added access to Indian markets.

This pipeline is non-starter for now given Pakistan's precarious financial condition.

Regards
 

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