Pakistan wants Iran to finance its side of gas pipeline: Petroleum Minister

Shahid Khaqan Abbasi says due to gas shortages, CNG pumps in Punjab will face closure from November to January.


Afp October 08, 2013
Abbasi told AFP on Tuesday that the preparatory work was complete, but they had asked Iran to provide $2 billion for the construction work. PHOTO: FILE

ISLAMABAD: Pakistan has asked Iran for $2 billion in financing to build its side of a controversial gas pipeline that has drawn threats of US sanctions, petroleum minister Shahid Khaqan Abbasi said on Tuesday.

The Iranian side of the $7.5-billion project is almost complete, but Pakistan has run into repeated problems paying for the 780 kilometre (485 mile) section to be built on its side of the border.

Abbasi told AFP on Tuesday that the preparatory work was complete, but they had asked Iran to provide $2 billion for the construction work.

"All these issues will be discussed in a meeting which we have requested, but so far there is no reply from the Iranian side," Abbasi said.

"They were busy in cabinet formation and I hope that this meeting will take place within this month."

It is the latest setback to hit the long-delayed section of the pipeline that would link the two neighbours and help ease Pakistan's chronic gas shortages.

US officials have warned that the project would risk triggering sanctions aimed at Iran.

But Abbasi denied coming under pressure from Washington since Prime Minister Nawaz Sharif came to power in the May 11 general elections.

"So far, Americans have not talked about this pipeline with us at any level," he said.

Asked if Pakistan was hoping to complete the project before the December 2014 deadline, Abbasi replied, "anything is possible, if we have the resources."

"It depends on the financing and availability of the machinery," he added.

Iran has the second largest gas reserves in the world but has been strangled by a Western embargo that has seen its crude exports halved in the past year.

It currently produces around 600 million cubic metres of gas per day, almost all of which is consumed domestically due to lack of exports.

Its only foreign client is Turkey, which buys about 30 million cubic metres of gas per day.

The Karachi stock exchange took fright when the countries' then-presidents Mahmoud Ahmadinejad and Asif Ali Zardari inaugurated the much-delayed section of pipeline in March.

Spooked by fears of US sanctions, the main index had slumped almost 2.5 per cent.

Abbasi said that the government had sought bids from Pakistani and Iranian companies for pricing of the construction cost of the pipeline.

Pakistan's gas shortage reaches crisis levels during the winter, when all compressed natural gas (CNG) stations (which fuel most vehicles in urban centres) in Punjab province will be shut down from November to January.

Many Pakistanis have converted their cars to run on CNG, depending on it as a cheaper alternative to staid fuels like petrol and diesel.

"Our first priority are domestic consumers during the winters, so there will be no gas for motor transport in Punjab," Abbasi said.

COMMENTS (35)

Ghani Kandahari | 11 years ago | Reply

Who is going to pay for the gas my pakistani brothers! lol

gp65 | 11 years ago | Reply

ETBLOGS1987

ET Mods - please allow fact based rsponse to Zen.One

@Zen.One: First of all your post has nothing whatsoever to do with the news item. India has no part to play in Pakistan's inability to finance the IP pipeline. Having said that I will address the points that you made.

India has a problem with toilets. The problem is being discussed at the highest political level. Pakistan too has a problem but no one is talking about it. http://tribune.com.pk/story/424180/toilet-facilities--a-luxury-for-most-pakistanis/Which would you prefer.

Yes India does sadly have problems related to female infanticide. There are laws against this. Government tracks metrics during the census in 2001 and 2011. Simultaneously there are plans to improve the economic, social and political standing of women to reduce son preference which is a root cause. If you think female infanticide does not happen in Pakistan you are wrong. http://tribune.com.pk/story/424180/toilet-facilities--a-luxury-for-most-pakistanis However there is hardly any discussion of this problem. Again what would you prefer? BEsides there are many metrics important to women where India's performance is much better than Pakistan i.e. female literacy rate, gender gap in literacy between men and women, maternal mortality rate, percentage of deliveries completed by skilled birth attendants, percentage of women in the workforce and so on.

In India due to the history of discrimination on caste basis prior to independence, the Indian constitution outlaws adverse discrimination against the lower castes. To the contrary, there is a significant degree of affirmative action in education and government jobs to address historic wrongs. With laws against discrimination, significant political voice and increasing education among what were once considered lower castes, the social mindset is also changing. In Pakistan on the other hand, discrimination against nonMuslims is baked in the constitution and getting worse by the day. Hindus, Sikhs, Christians, Ahmadis and lately Shias are witness to horrendous oppression.

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