Indian minister to visit Pakistan for talks on gas pipeline

Business Materials 22 April 2008 12:29 (UTC +04:00)

(dpa) - India's oil minister Murli Deora was due to hold talks in Pakistan on a 7-billion-dollar Iran-Pakistan-India (IPI) gas pipeline, officials said Tuesday.

"The minister is scheduled to leave for a three-day visit to Pakistan on Tuesday evening. He will hold talks on the IPI pipeline there," said a spokesman of the Petroleum Ministry without giving further details.

Deora is also likely to wrap up talks on the Turkmenistan-Afghanistan-Pakistan-India pipeline that is backed by the United States, which is opposed to the IPI pipeline.

Washington is opposed to the project, saying it would breach the US Iran and Libya Sanctions Act of 1996, which forbids more than 20 million dollars of investment in Iranian oil and gas projects.

Indian media reported that the visit was expected to provide a breakthrough on the IPI pipeline issue which has been stalled for almost a year due to transit fee issues.

The urgency has come about after China, with which New Delhi has been competing for hydrocarbon sources, showed an interest to replace India in the project, the Hindu newspaper reported.

"It was only after China expressed its interest in the IPI pipeline that India showed urgency for the talks. India did not take part in the three trilateral talks held during the last nine months without assigning any official reason," a senior petroleum ministry official told the newspaper.

"Mr Deora had cancelled his visit to Islamabad in February this year at the last minute," the official added.

The focus during Deora's talks would be on the "transit fee" sought to be levied for gas transported from Iran to the India-Pakistan border.

Under the proposed project, a pipeline of around 2,000 kilometres is to be laid, initially carrying 60 million cubic metres of Iranian gas to Pakistan and India. The pipeline capacity would later be increased to 150 million cubic metres.