The decision was taken at meetings between President Asif Ali Zardari, his delegation and Iranian authorities.
Iran for advancing on pipeline despite US pressure
Iran's supreme leader Ayatollah Ali Khamenei on Wednesday told the visiting Pakistani president that a much-delayed $7.5 billion gas pipeline project must go ahead despite US opposition.
"The Iran-Pakistan gas pipeline is an important example of Tehran-Islamabad cooperation, and despite hostilities towards the expansion of ties we must overcome this opposition decisively," Khamenei told Asif Ali Zardari, his office reported.
The gas pipeline project is strongly opposed by Tehran's archfoe Washington.
"Accessing safe energy source is the first priority for any country including Pakistan. In this region, the Islamic republic is the only nation that has safe energy resources and we are ready to provide Pakistan its energy needs," the all-powerful Khamenei said.
The pipeline project has run into repeated problems, including Pakistan's difficulty in finding funds and opposition to the project from Washington, which has slapped Iran with a raft of sanctions over its nuclear activities.
The Pakistani media reported last year that Zardari would visit Iran in mid-December 2012, when a final agreement was to have been signed, but the visit was delayed.
In 2010, Iran and Pakistan agreed that Tehran would supply between 750 million cubic feet (21 million cubic metres) and one billion cubic feet per day of natural gas by mid-2015.
Iranian President Mahmoud Ahmadinejad told Zardari that, "building the gas pipeline between Iran and Pakistan is a great and important event, and it serves the two nations' interests," the president's office reported.
"I believe that building this project is very beneficial for both sides and we support all the work carried out so far," Zardari said in talks his Iranian counterpart.
"The international and regional players have tried in vain to prevent an expansion of Iran-Pakistan ties but the people have learnt how to act against enemies of Islam," he was quoted as saying.
Islamabad has said it will pursue the project regardless of US pressure, saying the gas is needed to help Pakistan overcome its energy crisis that has led to debilitating blackouts and suffocated industry.
Iran has almost completed the pipeline work in its territory, but Pakistan has not yet started construction of 780 kilometers (490 miles) of the pipeline on its side, which is said to cost some $1.5 billion.
Sanctions-hit Iran finally agreed to finance one third of the costs of laying the pipeline through Pakistani territory to Nawabshah, north of Karachi, with the work to be carried out by an Iranian company.
Pakistani officials in mid-December said Iran had promised a $500 million loan and that Islamabad would meet the rest of the cost.
"There are impediments in view of the US opposition to the project but we are determined to complete it to meet our fast-growing energy requirements," said one government official on condition of anonymity.
Tehran has been strangled by a Western oil embargo that has seen its crude exports halve in the past year, while Pakistan has an acute need for energy and plans to produce 20 percent of its electricity from Iranian gas.
Iran has the second largest world gas reserves after Russia and currently produces some 600 million cubic metres a day, almost all of which is consumed domestically due to lack of exports means.
Pakistan for free trade with Iran
President Asif Ali Zardari and President Mahmoud Ahmadinejad on Wednesday decided to vigorously pursue the Iran-Pakistan gas pipeline project as well as other mega projects between the two countries.
Spokesperson Senator Farhatullah Babar said that the decision was taken during two rounds of meetings between the two leaders, one at the delegation level and the other at a one-on-one meeting when they underscored the need to take full advantage of each others' resources and expertise.
While highlighting need for greater trade President Zardari a proposed free trade agreement between Pakistan and Iran, an easing of visa restrictions and revisiting the tariff and non-tariff trade barriers.
President Zardari said that the two countries together with Turkey could provide fresh impetus to the Economic Trade Organisation that would further strengthen bonds among the people and also promote trade and socio-economic development in the region.
The only foreign client is Turkey, which buys about 30 million cubic metres of gas a day.
Tehran also plans to sell its gas to two other neighbours, Iraq and Syria. The three countries agreed in 2011 to build a pipeline, with the work already started on the Iranian side.
COMMENTS (16)
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@SHB
so u think our president can understand farsi ? :-)
@Ayesha: Do not worry about it. Urdu is more than 50% Persian. Written Urdu and Persian are same.
If memory serves me right then Iran's always been pro-India, no? They are just desperate to get their economy moving. They have been destroyed by the sanctions and the inflation rate there is more than twice that of Pakistan. Reserves dwindling is also a prob, poverty is also on the rise.
The pipeline won't materialize. Lets be realistic, the world powers will not let it happen
p.s. this is a bargaining chip for Qataris and Saudis to give more free oil & gas to Pakistan Govt. Pakistan's been surviving on free oil from Saudi since our 1965 war with India, we just have an appetite of hiding the reality.
Where is the money for the construction of pipeline? Khazana Khali hai.
What a personality. I love Ali Khamenei (God bless him)
A question that comes to my mind is: Will this pipeline proceed if PML-N or even PTI comes to power?
Both are aligned to KSA and other Gulf countries, either directly or indirectly through religious parties.
i heard ayatuallah sahab knows urdu too, but iranians doesnt talk in any other language than farsi, so does our president know farsi ? there isnt any translator !
@Baba Ji: Don't get me wrong. I am all for this pipeline. Not at this time though. I would be happy if Pakistan takes an initiative to wean Iran out of its quest for nuclear weapons and make this pipeline realistic.
so much similarities between zardari and misbah ul haq. like misbah zardari hit a six in the end of the inning when its too late too little
Pak must not back out from this project. The gas reserves are running out so this project is in the interest of Pak.
US and KSA please stay out and let's give Pakistani right to cook food for te children, please.. An earlier article in ET by Dr. Hoodbhoy gives detailed account of why KSA and US are against it. http://tribune.com.pk/story/368395/americans-and-saudis-hands-off-pakistans-pipeline-please/
ALLAH HU AKBAR
@ Raj - USA : Enron and Lehman Brothers was business as usual ... earning money selling resources is "black money" ...... good going Mr. Raj "USA" !!!!!
Pakistan should have taken the decision 2 years earlier. However, it is a good decision. let us see how the new elected government face this challenge.
To understand the interest in Iran pipeline, you need to read it along with another report in today's ET titled: Iran sanctions could distort region's economy for years: Report
Link: http://tribune.com.pk/story/513453/iran-sanctions-could-distort-regions-economy-for-years-report/
Unaccounted black money for years to come.