India, Iran to sign gas deal in June

Published February 12, 2005

NEW DELHI, Feb 11: India said on Friday it will sign a gas supply agreement with Iran in June, but will leave the issue of its supply through a $ 4.5 billion pipeline to be resolved between Iran and Pakistan.

The announcement came as influential analysts led by two major business dailies expressed their doubts about the feasibility of the pipeline traversing through Pakistan.

It also came two days after the Indian cabinet authorised Petroleum Minister Mani Shankar Aiyar to negotiate multilateral deals with Iran, Turkmenistan and Pakistan on the one hand and Bangladesh and Myanmar on the eastern front, leaving out the cumbersome foreign ministry from its loop.

"I am going to Tehran in June and hope this would act as a catalyst in furthering an agreement on import of natural gas through pipeline passing through Pakistan," Mr Aiyar said after meeting Iranian ambassador Siyavash Zaragar Yaghoubi here.

The agreement with Tehran will be for the delivery of natural gas on the Indian border and New Delhi would not be associated with the construction, maintenance or operation of the 2775-km pipeline, 760-km of which would pass through Pakistan territory.

"There will be two sets of bilateral agreements. In the first one, Iran will enter into a pact with India for delivery of natural gas at Indian borders while the second would be between Iran and Pakistan on how the gas is to be transported to the Indian border," Mr Aiyar said.

Analysts said New Delhi would not enter into any agreement with Pakistan and deal only with Iran on the issue. They said it would be Tehran's responsibility to work it out with Pakistan to lay the pipeline and assure its safe delivery of gas on the Indian border.

As India braces to negotiate far-reaching deals it will become inevitable to wade through the political minefields that make up the complex agenda, analysts warned on Friday. The Business Standard applauded Mr Aiyar, a former diplomat who has served in Pakistan, for getting oil diplomacy at last "firmly on the front-burner".

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