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Gas pipeline project hinges on MFN status to India

By B. Muralidhar Reddy

ISLAMABAD, JAN. 10. Gas pipeline from Iran to India via the land route of Pakistan could become a reality if Islamabad extends the Most Favoured Nation status on trade front to India.

According to diplomatic sources, India has conveyed this to Pakistan during the meetings on the sidelines of the SAARC summit.

The Pakistan Prime Minister, Mir Zafarullah Khan Jamali, in his meeting with the Prime Minister, Atal Bihari Vajpayee, had urged him to consider Indian participation in the proposed project.

India had reservations about the project on two counts. First, New Delhi was keen on full-fledged economic relations with Pakistan and that would be possible only if Pakistan reciprocated the gesture of MFN granted by India in 1995. Second, India had apprehensions about the safety and security of the project given the history of hostilities between the two sides.

The project has been pending for several years in view of Indian concerns.

There has been little progress on the proposal despite assurances from the Pakistani side guaranteeing the safety of the pipeline as India was of the view that without serious economic stakes for Pakistan, such a project would not be complete.

Significantly, experts from Pakistan and Iran met days before the SAARC summit and decided to go ahead with the project irrespective of the Indian position.

Observers believe that the pipeline will not be economically viable if it is not extended to India. Pakistan will gain tremendously in economic terms. It can earn an estimated $700 million annually through royalties.

Mr. Jamali said that he told Mr. Vajpayee that Pakistan was almost self-sufficient in gas but India was deficient and the project would benefit it more. He said the "ball is now in the court' of Mr. Vajpayee.

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