ISLAMABAD: Pakistan said Thursday it would seek Russian funding for a multi-billion dollar gas pipeline from Iran amid Chinese reluctance to invest in the project over fears it could be hit by sanctions.
The quest for alternative sources of funds began when the Industrial and Commercial Bank of China (ICBC) failed to sign up to a consortium to finance Pakistan’s $1.5 billion share of the project.
“Pakistan’s technical delegation will visit Moscow early next month to have discussions on this subject,” said Foreign Ministry Spokesman Abdul Basit.
The Pakistan team will hold talks with relevant officials and different companies, including Russian gas giant Gazprom, Basit said.
A Petroleum Ministry official confirmed that Russia was a possible source of funding, given that there has still been no formal response from ICBC.
The United States wants Islamabad to abandon the project because of sanctions against Iran over its controversial nuclear programme, but Pakistan has insisted it is vital in helping to overcome a debilitating energy crisis.
Pakistan and Iran signed a deal in 2010 in which Tehran would supply natural gas to its eastern neighbour from 2014, with sales to reach 750 million cubic feet (21 million cubic metres) to one billion cubic feet per day by mid-2015.
Pakistan, which produces just 80% of its own electricity needs, has presented the $7.5 billion gas project as a partial answer to the energy crisis, which has led to blackouts and has suffocated industry.
COMMENTS (11)
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Make a deal with US - IP pipeline for NATO supplies...
Let us face it; Pakistan is in bad financial condition and we are in bad neighbourhood . Banks fund credit worthy clients and banks are risk averse.
Not good. Our all time friend China betrayed us again.
@3akr:
Then I believe it is your position that this pipeline will be built by the Russian. Time will tell if this is so and if in fact PAK will benifit from this undertaking....
@ cautious its a sign of loosing hegemony by self called super-power. yeah you never know and be "Cautious". Pakistan possess loads of potential to pass any special smell test, you just name it. Now its time to ponder wheather America will be able to "pass the smell test". I can translate it as moral conundrum for America.
Russians may have money and the expertise but will not go against UN sanction on Iran. May be the forthcoming visit will pavevthe way for collaboration in other projects.Diplomatically it will break the ice and both countries will put the past bitterness into cold storage and move forward. Pakistan will do well if they enhance their relationship with neighbouring countries which will ultimately open new markets and new opportunity .
I doubt anyone of your leaders puts much faith in Russia going out on a limb for Pakistan - doesn't pass the smell test. It's a sign of desperation.
It reminds me of an old parable “paissa naa pale, karti mela mela”. No investor in right mind will invest in the environment where even the current gas pipeline is not secured. Pakistan can not even pay for the gas coming through the pipeline; forget about the cost of building a pipeline. Very soon Pakistan will be asking for loan forgiveness. Current oil and gas comes to Pakistan on six months deferral payment and it speaks volume of the state of economy. Does it mean Pakistan is abandoning the Chechen cause?
This project has to initiate ASAP! it will come as a mega jobs-relief to many Pakistani labour people, specially from Balochistan!
Controversial ????
Why the heading "controversial pipe line" and not "IP pipe line"? I thought it was direct favourable for Pak energy needs .