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Last Updated: Wednesday, 13 July, 2005, 09:36 GMT 10:36 UK
South Asia gas pipeline talks end
Indian oil minister Mani Shankar Aiyar (right) with Pakistan petroleum secretary Ahmed Waqar
Indian oil minister Mani Shankar Aiyar (right) with Pakistan petroleum secretary Ahmed Waqar
India and Pakistan have held talks on a proposed project to pipe gas to India from Iran via Pakistan.

The two sides discussed technical aspects of the project as well as the proposed routes and delivery points.

The two countries have agreed to co-operate in securing gas for their energy needs from external sources.

The project has long been discussed but never got off the ground, because of Indian security fears as the pipeline runs across Pakistan.

We will proceed with this project based on our national interests
Pakistani Oil Secretary Ahmed Waqar

A statement released by both sides after the talks in the Indian capital, Delhi, said India and Pakistan were committed to addressing all the issues concerning the project.

"In order to realise a safe and secure world class project, arrangements would need to be provided for in every aspect of the project, including technical, commercial, financial and legal matters," it said.

The United States has expressed reservations over the purchase of natural gas from Iran, a country it accuses of supporting terrorism.

India has dismissed such reservations in the past.

Pakistani officials said the pipeline will proceed despite US reservations.

"Our president and prime minister have stated on a number of occasions that we will proceed with this project based on our national interests," Pakistani Oil Secretary Ahmed Waqar was quoted as saying by the AFP news agency.

'Pipeline diplomacy'

The 2,600km (1,620-mile) landline would cost about $4bn and the supplies would be a huge boost for energy-starved India.

Any overland line to Iran will have to transit Pakistan

India's energy demands, both in oil and gas, are expected to double by 2020 as the country's economy grows rapidly.

The world's second most populous country produces only half the natural gas it uses and currently imports 70% of the crude oil it needs.

Record oil prices in recent months have hit India hard as a result.

The Indian government says natural gas imports will be needed if expected economic growth of 7-8% is to be sustained.

Three pipelines are under consideration - from Iran through Pakistan, from Turkmenistan through Pakistan and Afghanistan, and from Burma through Bangladesh.

Pakistan, Bangladesh and Afghanistan stand to reap millions of dollars in transit fees.

India has already signed a $40bn (21bn) deal to import millions of tonnes of liquefied natural gas from Iran.

India and Iran in gas partnership
03 Nov 04 |  Business
Iran urges India to back pipeline
27 Jan 03 |  South Asia

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