ISLAMABAD, Jan 30: Islamabad has received positive signals from New Delhi on the proposed trans-Pakistan gas pipeline, a venture that appeared to be going sour because of recent Indian resistance to it.

The estimated $4 billion project is meant to transfer gas from Iran to India via Pakistan through a 1600-kilometer pipeline. Indications are that the stalled project may be revived soon. Serious negotiations on the project are expected to take place during the next few weeks between top Pakistani and Indian leadership, it is learnt.

It will be a major talking point at a meeting between Prime Minister Shaukat Aziz and his Indian counterpart Dr Manmohan Singh on the sidelines of the Saarc Summit in Dhaka, sources said.

Mr Aziz will also discuss the matter with the Iranian leadership when he visits Tehran in February. The project had stalled because of a quid pro quo on the MFN status. Apparently, India had subsequently made any progress on the project conditional upon Pakistan agreeing to buy diesel pumped from Panipat in Indian Punjab.

However, positive signals have been received from New Delhi., particularly the Indian petroleum minister, who has suggested that India is reviewing its policy of linking the gas pipeline project with MFN status and sale of diesel.

According to sources, it has been recently conveyed to Pakistan that India is now willing to move forward on the gas pipeline as a stand-alone project. It appears that Indian Petroleum Minister Mani Shankar Aiyar is wearing away from India's bureaucratic line of going it slow with Pakistan.

It will be clear in the next few days whether Mr Aiyar, a diplomat-turned-politician, will lead the Indian initiative in the energy sector or will he be led by the standard bureaucratic approach of creating more hurdles in the way of a project involving Pakistan.

Significantly, the position taken by Pakistan, especially the prime minister is that India has imposed an unnecessary condition and has thus responded negatively to Pakistan's positive posture.

According to insiders, the prime minister told Indians recently that while Pakistan was 'unbundling' on the Kashmir issue, India had chosen to take a contrary position. Mr Aziz made it clear that Pakistan sought progress on Kashmir without blocking progress in other areas.

The prime minister's clear message to the Indian leadership during his visit to Delhi in November was that Pakistan would go ahead with the pipeline project even if India did not come on board.

His contention was that it was a stand-alone project and must be treated as such. On Friday, the prime minister reiterated that Pakistan would press ahead with the pipeline project even if India refused or was unable to join the plan.

The project has been in the pipeline for over a decade now. Earlier, India had repeatedly raised with Pakistan the question of security of the pipeline. Eventually, some understanding was reached on a mutual neutral security arrangement. Negotiations recommenced in earnest with the improvement in Indo-Pakistan relations last year.

It is widely believed that the pipeline project would help promote peace and stability in the region. It would yield political as well as financial dividends for all the players.

Prime Minister Aziz said the other day that Pakistan had offered energy corridor to India to help fulfil its growing hydrocarbon needs, which could serve as a real symbol of peace between the two neighbours. He maintained that the proposed pipeline would be given complete protection, without going into the specifics.