LAHORE, May 31: Pakistan  signed an agreement with Iran on Thursday for purchase of 1,000MW electricity, said a spokesman for the National Transmission and Dispatch Company (NTDC).

The agreement was signed during talks in Tehran between Pakistani delegation headed by NTDC managing director Rasul Khan Mehsud and the Iranian delegation led by Deputy Minister for Energy Muhammad Behzad.

Under the agreement, Iran will provide 70 per cent of the funds required for the project and Pakistan will arrange the rest.

The NTDC spokesman said the project would be completed in three years. He said that electricity would be bought at eight cents per unit and in case of hike in the international price of oil a rate of 11 cents would be charged.

According to him, the signing of the accord was an outcome of the talks held by President Asif Ali Zardari and Prime Minister Yousuf Raza Gilani with President Mahmoud Ahmadinejad during the Iranian leader’s visit to Islamabad.

Federal Minister for Water and Power Syed Naveed Qamar said the industrial, commercial and industrial consumers in Balochistan, especially the Makran coast, would benefit greatly from the project.