ISLAMABAD, Jan 5: Islamabad has told Tehran that Iran-to-Pakistan gas pipeline should be pursued as a stand-alone and independent project in case India is not ready to join it, it is learnt.

Iran has agreed to the proposal but has expressed its desire to give India a chance to join the project to ensure a bigger market and reduce overall cost of the project, sources said.

These options were discussed here on Wednesday at a meeting between oil and gas ministers of Iran and Pakistan. Iranian Oil Minister Bijan Namdar Zangeneh led a six-member delegation at the meeting while the Pakistani side was headed by Petroleum and Natural Resources Minister Amanullah Khan Jadoon.

The Iranian delegation that was here on a day-long visit left in the evening for New Delhi to discuss Indian participation in the gas pipeline project. An official statement said the meeting discussed bilateral issues to enhance cooperation between the two countries with specific reference to export of Iranian gas to Pakistan.

"During the meeting, both the sides agreed to take steps to initiate (the project) without further delay as Iran wants a market for its gas and Pakistan needs to meet its shortfall in the coming years," said the statement.

Sources privy to the meeting told Dawn that Pakistan informed the Iranian side that Iran-to-Pakistan gas pipeline project had become very attractive in the light of fresh studies conducted by Islamabad about the country's gas demand.

The studies suggest that Pakistan's gas shortfall will start from 400mmcfd (million cubic feet of gas per day) by 2010 and increase to about 4bcfd (billion cubic feet of gas per day) by 2025 because country's economy was poised to grow at a rate of seven per cent by the end of the current fiscal year.

Pakistan also suggests that the two countries should start working side by side on Iran-to-Pakistan and Iran-to-India through Pakistan gas pipeline so that if Indian option is delayed the Iran-to-Pakistan pipeline option is not left out in the cold, the sources added.

The sources said the Iranian side was convinced about the suggestion and agreed to move forward on both the options simultaneously. The two sides agreed that India was unnecessarily avoiding the project despite the fact that it was energy-deficit and was purchasing LNG at much higher economic cost.

The Pakistan side also reiterated its full support and foolproof security arrangement as earlier announced by President Pervez Musharraf in case India joins the project. Under the Iran-to-Pakistan project, Iran will bring its gas to the Pakistan-Iran border from where Pakistan will lay its own pipeline to its load centres.

The positive points of this project are that there are no transit countries in this project that can be completed through bilateral agreements and both the countries have the capability to construct the pipeline in their own countries.

Iran has indicated a price at the Pakistan border at $2 per mmbtu which Pakistan understands could be negotiated to a reasonable level. Iran has also offered to enter into some formal agreement with Pakistan to sell specific quantities of gas.