Proposed Iran pipeline at risk following IAEA vote

Vol 9, PW 21 (09 Feb 06) People & Policy

Murli Deoras reputation as Washingtons ally in Delhi has inevitably cast doubts on Indias commitment to the gas pipeline from Iran.

This, coupled with a 4th February decision by the Vienna-based International Atomic Energy Agency to refer Iran to the United Nations Security Council, and Indias controversial decision to support the move, puts the pipelines future further in doubt. Still, the process launched by Mani Shankar Aiyar and former oil secretary Sushil Tripathi to move the project forward is firmly on track, and shows no sign of letting up.

On 31st January, four days before the IAEA vote, technical experts from Iran, India and Pakistan ended a landmark two-day meeting in Delhi to discuss the finer points of pipeline construction, amid growing Western clamour to punish Iran for pursuing its uranium enrichment programme. Hossein Karimi Ashtiani, representing the National Iranian Gas Exporting Company (NIGEC), was tight-lipped when asked by this report about the outcome of the two-day meeting in Delhi the first of its kind between technical experts from the three countries.

So too was Syed Hassan Nawab, managing director of Inter State Gas Systems, who led the six-member team from Pakistan. Is it any wonder If Iran refuses to back down between now and March, its likely, though not certain, that Tehran will face UN trade sanctions, forcing India to abandon the pipeline project and LNG imports a point not lost on one source close to the technical meetings in Delhi.

We are here to make this pipeline a world class project, he said. But financing is linked to the political situation in Iran.

Arranging international funding will be the biggest challenge much bigger than the technical challenge. Some in the oil ministry dismiss the doubters, believing Russia and China will veto sanctions against Tehran.

If they do, theres still hope. Technical experts from the three countries hold their second meeting in Tehran in March.