Pipeline: India, Pakistan narrow down differences

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Murli Deora
Murli Deora

Sujay Mehdudia

Deora likely to visit Pakistan in May

NEW DELHI: The progress on the India-Pakistan-Iran natural gas pipeline has been satisfactory with New Delhi and Islamabad narrowing down their differences on transportation and transit fee considerably.

Highly placed sources in the Petroleum and Natural Gas Ministry said the talks had entered the final phase, with both sides broadly agreeing on basics in the pricing formula.

It is learnt that Petroleum and Natural Gas Minister Murli Deora is likely to travel to Pakistan and Iran in May to give finishing touches to a price formula deal.

Mr. Deora, who recently made an unscheduled visit to Tehran, is understood to have been satisfied with the progress of talks with Pakistan as well as Iran on the issue.

The sources said that during Pakistan Prime Minister Shaukat Aziz's recent visit for the SAARC summit, Mr. Deora met him and sought a lower transportation and transit fee to sustain the $22-billion natural gas deal with Iran. The request evoked a positive response.

Transportation tariff

"We proposed a transportation tariff of 50 to 55 cents. However, in the last few meetings, Pakistan had demanded $1.57. Now they had come down to 70 to 75 cents. On the transit fee, Islamabad is expecting 49.3 cents and we were offering around 20 cents, something that was prevalent in the international market for transition purposes," a senior official said.

The sources said negotiations were on at the Secretaries' level and there was optimism that things would work out positively in the next few weeks.

"Hopefully, if all goes well, an agreement on the deal could be signed sometime in June," the official said.

According to the present indications, pipeline within Iran up to Iran-Pakistan border will be laid and operated by an agency to be nominated by Tehran. Iran has offered to sell gas on its border with Pakistan and all responsibilities for the safety and security of the pipeline within Iran will wrest with it. In the Pakistan territory, of the 1,035 km, 800-km pipeline will carry gas for both the countries.

The Pakistan Government was levying a transit fee for providing safety and security for the pipeline within its territory.



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