Fortunately, for Pakistan there are possible alternatives to finance the project. The second-lowest bidder for the contract, which is a consortium that includes local firms and foreign firms with experience working in Pakistan, can be a possible alternative to finance the project. Although this option will end up costing the government more, the Iran-Pakistan pipeline is so vital to the country’s energy needs that the extra cost can be overlooked. Other options available include cutting out the middlemen and dealing directly with friendly governments or even coming to a barter agreement with Iran where we would exchange wheat in return for construction help for the pipeline. A gas levy is also reportedly being considered but, given recent gas price increases, that option may not be palatable to the Pakistani people.
As for China, we need to prepare for a time when our alliance with them is severely undermined by growing relations between China and India. Trade between the two countries has now reached nearly $50 billion a year and is only expected to increase substantially in the next few years. For an alliance that started only because the two countries shared a mutual suspicion of India, this spells trouble. Relying on only one ally is never a good idea, and in the case of China, it is becoming increasingly problematic.
Published in The Express Tribune, March 15th, 2012.
COMMENTS (11)
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@Naseer Qureshi: You lack the ability to discern between "friend" and "all weather friend." The concept of an all weather friend is they stand by you and help you at every turn (in all weather). Being selective doesn't give that title.
I think we should not take this exceptional news so seriously. It is true that every nation protects its interests but China IS as always has been Pakistan's all weather friend. China has invested heavily in Pakistan in various development projects. It also support Pakistan military and have many joint major projects like JF17 and Gawadar Port. Trade between two countries is ever increasing. China has supported Pakistan diplomatically and vice versa in international forums.
There are no "all whether friends". Today's adversaries would be friends tomorrow and vice-versa. It all boils down to economic and geopolitical interests. Hope our rulers accept the reality; sooner rather than later.
Arch enemy's enemy is our friend, being the policy of Pakistan think tank and its a failure by design. International community is smart enough to choose between a state which is economically(PPP) 3rd ranked and a state which is one amongst the failed state index's top 10.
Pak's alliance with China is more likely to be undermined by the terrorism problems caused by the pak based/trained terrorists in the Chinese western border rather than Chinese relations with India.
In the matters of statecraft, there is no scope of emotions but the national interests. Hence we can not blame China for backing out as it has to first see her own interests. It is time for Pakistan to reflect on its diplomacy. The whole scenario needs to be considered dispassionately and breaking down of this contract must never shadow our historic relations with China - there is a lesson to be learned.
Pakistan since independence has been conducting lopsided diplomacy, first joining unnecessary alliance and thereafter acing a US stooge to block Russian advance in Afghanistan and then in 2001 taking a u turn. All of these policy options had nothing to do with our interests but it was to look after interests of individuals.
Let us be cool and consider other options and also do business with China and India if it is in our interest.
Your govt doesn't pay it's utility bills, landing fees, etc - and has a terrible credit rating - so borrowing for this project is going to be a challenge. Forget the pipeline for a second and lets talk about how you pay for the fuel and whether that fuel helps eliminate your fuel deficit. If this is incremental fuel then where does the money come from to buy that fuel? Short term borrowing for fuel maybe much more expensive/tougher/impossible than borrowing for long term capital projects. If your simply changing suppliers and using the cost saving to buy incremental fuel - then how much savings are you talking about? -- the amt of savings determines the amt of incremental fuel. Why hasn't Pakistan performed and released and economic study of this project - something that will explain the benefits and limitation of this project - should take the emotion out of the issue and give the people some facts to ponder.
For all the wisdom that ET at times your editorials look rather emotional than rational. The only ally a nation has is it's population and their economic prosperity, the rest of the world is their with you becoz of your usefulness in their plans.The question is what kind of leverage do you want to have, economic, political, emotional,etc.personally I believe economic leverage is the best leverage one can have, becoz not only is it free of ideological and political burdens, it also benefits people of your country.
totally agree.....
Incase of China, We should prefer better business sense to prevail rather than emotions.
Indo-China bilateral trade for 2011 is exactly $74b.... Come on ppl at ET,Its editorial article ... and still mistake.... SHAME