Iranian oil minister set to visit India on 18th January

Vol 9, PW 19 (12 Jan 06) People & Policy

Growing Western outrage at Irans nuclear programme is having little impact on the countrys proposed gas pipeline to India through Pakistan.

On 18th January, Irans newly installed oil minister Kazem Vaziri-Hamaneh comes to Delhi on an invitation from Mani Shankar Aiyar to resume gas export talks to India his first visit here as oil minister. Vaziri-Hamanehs priority will be to soothe Indian concerns over a deal for the import of 5m t/y LNG signed last year.

Delhi is worried that delay by the National Iranian Oil Company (NIOC) in guaranteeing the contract signed with its subsidiary National Iranian Gas Export Company (NIGEC) reflects Tehrans lack of commitment to the agreement. Also awaited is approval by Irans Supreme Economic Council of the nearly $1bn investment in the project.

India believes the contract with NIGEC is legally enforceable, despite the absence of the NIOC guarantee or the Supreme Economic Councils approval, something Tehran disagrees. The contract is valid in international law, retorts a source in Delhi.

But theres no need to go to court over this as long as weve a political relationship with each other. Sovereign nations do not stake their honour in courts of law on such small issues.

Vaziri-Hamanehs visit comes against a backdrop of growing Western concern at Irans decision to resume research on its uranium enrichment programme and a steady stream of unseemly remarks by Iranian president Ahmadinejad. Still, theres undeniable progress on the pipeline.

Later this month technical experts from India, Pakistan and Iran will meet for the first time in Delhi to discuss the project. A secretary-level tripartite meeting in Tehran in February will follow and IN March there will be a tripartite ministerial level meeting in Teheran.

Still under negotiation is the crucial issue of price. Delhi sources tell us India and Pakistan will jointly ask Iran for a common price for the piped gas.

There should also be a ceiling on the price since it is going to be a 25-year contract with a take-or-pay clause, we hear.