NEW DELHI, June 29: India’s petroleum minister, Murli Deora, said on Friday that officials from Iran, India and Pakistan have resolved most issues relating to the gas pipeline that would carry gas from Iran to the two South Asian countries.

An Iranian official attending the tripartite talks on the $7.4 billion project said his country hoped to start supplying gas to India and Pakistan by 2011.

The Indian minister who spoke to reporters in New Delhi after officials from the three countries held talks on issues such as price mechanisms and transit fee, said: “I am very glad that they have reached to a great extent on all the sides agreements… maybe small things are still pending.”

Mr Hajjatollah Ghanimifard, an international affairs director with the National Iranian Oil Company, told reporters that the revenues from the gas sales would be used for “general economic development of Iran,” comments that may not go down too well with the United States, which wants India to distance itself from the project.

US Secretary of State Condoleezza Rice was quoted on Friday as urging India to dump its ties with the Non-Aligned Movement of which Iran is a leading member. India responded by reiterating its solidarity with NAM, further complicating the scenario for Washington on the pipeline and a host of other issues in the Third World that affect its standoff with Tehran.

Iran has completed 18 per cent of the work for the pipeline, which will supply gas from its prolific South Pars field up to Iran-Pakistan border, Mr Ghanimifard said.

Pakistan said work has yet to begin on a 1,000km stretch of the pipeline to link Iran with India.

“It is a segmented project, we have estimated the cost of laying the pipeline from Iran point to India at $2.5 to $2.75 billion at current prices,” Pakistan's energy secretary Ahmad Waqar said.

Officials close to the talks said ministers from the three countries are expected to meet next month, first in Pakistan and then in Iran, to hammer out the final details.

The 2,600km pipeline has been billed as a “peace pipeline.”