India's concerns are pricing of gas and security of supply

Terming the Turkmenistan-Afghanistan-Pakistan-India (TAPI) pipeline the new ‘Silk Route' between Central Asia and South Asia, Petroleum Minister Murli Deora on Saturday said the project would aid in rapid economic growth of not only India but also the participating countries.

Addressing delegates at a TAPI Steering Committee meeting in Ashgabat in Turkmenistan, Mr. Deora said India and its Prime Minister, Manmohan Singh, described the project as a “peace pipeline” for the region.

The project would enable a flow of 38 mmscmd of gas to the country. “India strongly believes in regional cooperation, and this pipeline will be a testament to regional cooperation and solidarity. The TAPI gas pipeline will be the harbinger of economic growth and prosperity to us all. Through the Inter-Governmental Agreement and the GPFA, we have laid the foundation for the project.”

Mr. Deora said the pipeline would bring the countries involved closer and reinforce the age-old ties. “It is our firm belief that the solutions to the problems of our region have to come from us and not from outsiders.”

While many issues relating to the pipeline had been satisfactorily addressed, the four countries had still some distance to travel. “We have laid the foundation and now the edifice has to be built brick by brick. Without doubt, pricing of gas is one of the most important issues. It needs to be appreciated that Turkmen gas would have to compete with other forms of gas in the markets of the buyer countries, including indigenous gas.”

India, Mr. Deora said, had a huge gas find on the east coast, and almost 40 per cent of its present indigenous production was coming from that discovery made last year.

In India, the power sector continued to be the anchor customer for natural gas and, hence, the alternative fuel was coal, and not just liquid fuels.

“Pricing of Turkmen gas, with the associated cost of transnational transportation, would have to be mindful of these ground realities. Security of supply is also a major concern for India. Being at the tail-end of the project, India will incur the maximum risk with regard to safety of supply. Our concern is not only during the commissioning of the project and the laying of the pipeline but also during the many years of its operation. Our goal is not merely the construction of the pipeline but also continuous and uninterrupted flow of Turkmen natural gas over the coming decades.”