India working with Pak to resolve issues on IPI gas pipeline

Ajay Kaul

Tehran, Nov 1 (PTI) Affirming its commitment to the
proposed Iran-Pakistan-India (I.P.I.) gas pipeline, New Delhi
Saturday said it is working with Islamabad to resolve
outstanding issues and insisted that the USD 7.4-billion
project can be finalised through cooperation of all the three
countries.

Inaugurating the India-Iran Joint Commission Meeting
here, External Affairs Minister Pranab Mukherjee also
expressed hope that Iran would implement the Liquified Natural
Gas (L.N.G.) deal of 2005 for supply of five million mtpa of
L.N.G.

He said India also expected that 20 per cent stake for
Oil and Natural Gas Corporation (O.N.G.C.) Videsh Ltd in
Yadavaran gas field as part of the L.N.G. agreement would be
honoured by Iran.

"We have reiterated to the Iranian government at all
levels that India remains committed to the I.P.I. project. We
are working with Pakistan to resolve outstanding issues
pertaining to transit and transportation tariff," the Minister
said.

"With the cooperation of all three sides, it should be
possible to finalise the project," he said.

The two-day Joint Commission meeting, co-chaired by
Mukherjee and Iran's Economic Minister Shamseddin Hossein, is
discussing new initiatives in various sectors including trade
and investment, energy, mining, railways and banking.

Noting that India was looking for a more balanced trade
profile, Mukherjee invited Iranian participation in India's
growth.

He said the two countries have finalised negotiations on
Double Taxation Avoidance Agreement (D.T.A.A.) and Bilateral
Investment Promotion and Protection Agreement (B.I.P.P.A.) and
are agreeable on commencing discussions on a Preferential
Trade Agreement (P.T.A.) to strengthen bilateral trade.

India and Iran have already sorted out banking issues and
sought to create a suitable ambience for investments, joint
ventures and collaborations, Mukherjee said.

"India is globally acknowledged as an investment
destination. We would invite Iranian friends to also benefit
from India's growth," he said.

Observing that the two countries have already
demonstrated in the past that they can successfully
collaborate in major economic projects, he said, "our strong
bilateral relationship in the oil and gas sector can be a
stepping stone for Iranian investments in that sector."

Mukherjee expressed happiness over the discovery of oil
and gas by OVL in the Farsi block after exploration work at
four sites at an estimated cost of USD 90 million.

"OVL is hopeful of being awarded the development contract
under a mutually acceptable arrangement," Mukherjee said
while noting that OVL is also involved in negotiations on the
development of South Parl Phase 12 and Azadegan fields.

"We hope bilateral cooperation in this sector would be
further strengthened by the implementation by Iran of the
L.N.G. deal concluded in 2005 for the supply of five million
mtpa of L.N.G. to India by Iran," Mukherjee said.

He said that trade in oil sector has been adversely
impacted by banking problems which has since been resolved to
the satisfaction of both sides.

The Exim Bank of India has renewed until 2009 a medium
term Government of India-supported Line of Credit of USD 200
million to seven Iranian banks to support bilateral trade.

India would like the unutilised amount of around USD 115
million to be optimally harnessed for enduring projects
symbolising close bilateral ties. PTI AKK
PMR
NNNN