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Agreement revives pipeline hope

New Delhi, Nov. 25: India today resumed talks with Iran on a 2,700km tri-nation gas pipeline it had virtually abandoned in 2009, a day after Tehran struck a landmark deal with world powers on its controversial nuclear programme.

Foreign secretary Sujatha Singh has indicated to visiting Iranian deputy foreign minister Ebrahim Rahim Pour that India retained concerns over gas pricing and security of the pipeline that will run through Pakistan, senior officials said.

But discussions on the pipeline during foreign office consultations today underscored a fresh determination in India not to give up on a project as critical for New Delhi’s strategic interests in the region as it is for gas.

Iran and Pakistan have offered to extend the pipeline to China if India skips the project, using an economic corridor running through Pakistan-Occupied-Kashmir to the troubled Xinjiang province in China. Iran holds the world’s second-largest reserves of natural gas. “The project remains a tough proposition, but we haven’t given up,” an official said.

Yesterday’s agreement between Iran and the P5 + 1 one — as the group of the US, UK, Russia, China, France and Germany is called — in Geneva has eased pressure on Tehran’s traditional allies like New Delhi which in recent years have scaled back trade ties.

India first committed to the $3-billion (around Rs18,750 crores at current exchange rates) pipeline in 1999, but virtually backed out in 2009, a year after the Indo-US nuclear deal and amid blossoming ties with Washington.

India has always blamed pricing of Iranian gas and worries about the security of a project that runs through Pakistan for its reluctance on the pipeline but concerns over the impact on ties with the US were a key deterrent.

Although India never formally pulled out of the project, it took little initiative to search for solutions.

The project remains an obsession with Iran, which has already built most of its 1,200km stretch from the port city of Asalouyeh, through Iranshahr to the nation’s border with Pakistan’s Baluchistan province.

Pakistan has committed to extending the pipeline through Khuzdar to Multan, with a second artery running from Khuzdar to Karachi.

The pipeline could enter India either through Kutch or through Rajasthan.

But both Iran and Pakistan have offered to extend the pipeline north from Multan to China through PoK if India eventually withdraws from the project.

India has raised concerns with Beijing over the proposed economic corridor connecting China with Pakistan through PoK, but recognises that its two neighbours may pursue the project if they conclude it is economically viable.

Today’s talks in Delhi — where Singh and the Iranian deputy foreign minister also discussed trade, oil and the Sunday’s Geneva pact — represent recognition that withdrawing completely from the pipeline project may hurt India.

External affairs minister Salman Khurshid had in May this year visited Tehran and discussed the project. At the time, Iran had suggested an alternative route— an undersea channel bypassing Pakistan completely.

But the easing of sanctions — something the Geneva pact could pave the way for — against Iran remains a critical precondition for India to feel comfortable about investing in the project, officials said.

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