ISLAMABAD: Seeking to allay apprehensions on the proposed India-Pakistan-Iran multi-billion dollar gas pipeline project, India and Pakistan have reiterated their commitment to it and agreed that it would contribute significantly to the prosperity and development of the two countries.

A joint statement issued at the end of the first leg of the visit of External Affairs Minister K. Natwar Singh on Tuesday made a one-paragraph reference to the project. While there have been no new developments related to the pipeline, both sides deemed it necessary to take note of it in the light of the controversy triggered by the Indian decision to vote on the EU-sponsored resolution on the Iranian nuclear programme at the International Atomic Energy Agency (IAEA) meeting in Vienna.

The project also figured at the bilateral discussions between Mr. Singh and his Pakistani counterpart, Khurshid Mahmud Kasuri, as well as at Mr. Singh's meeting with Pakistan Prime Minister Shaukat Aziz. In the course of the discussions India pointed out to the Pakistani leadership that it had recently appointed an expert to look into the `economic viability' of the pipeline and awaited the report for a decision.

The Pakistani side said that it would soon be appointing an expert to evaluate the pipeline from the economic angle. The Pakistan Petroleum Minister is set to visit New Delhi for a meeting of the India-Pakistan Joint Working Group on the pipeline. In his interaction with Mr. Singh, Mr. Aziz referred to the Iran gas pipeline as `a win-win situation for everyone.'

At his press briefing on Monday, Foreign Secretary Shyam Saran said the Indian vote on the Iran resolution at Vienna had nothing to do with the pipeline and the `economic viability' of the project would be the sole criterion for New Delhi in deciding on it.

In his interaction with Mr. Singh, Mr. Aziz underlined the need for showing "flexibility, magnanimity and courage by all stakeholders — India, Pakistan and the Kashmiri people — for resolving the decades-old Kashmir dispute."

An official statement by Pakistan said he described the ongoing composite dialogue as productive as it was helping in improving ties between the two countries. It quoted Mr. Aziz as saying that the resolution of the Kashmir "dispute in line with the wishes" of the Kashmiri people would lead to durable peace in South Asia.

The water disputes — Baglihar and Kishanganga — also came under discussion as the Prime Minister stressed that the two countries should resolve these issues as water was important for both of them. Pakistan had already approached the neutral expert under the auspices of the World Bank on Baglihar.

H expressed satisfaction about the progress on the old disputes of Sir Creek and Siachen and said it would help improve the `atmospherics' between the two countries. Increasing the number of flights and routes between Pakistan and India also came under discussion.

It has been agreed that Habib Bank Limited will open its branch in India while the State Bank of India will follow suit in Pakistan.

Mr. Aziz also said that the progress in economic cooperation must go in "tandem with the progress on the Kashmir dispute."

He told Mr. Singh that Pakistan was a free trade country but would not allow free investment and trade with India without any progress on Kashmir.

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