India and Iran close to strike $4.5 billion undersea gas pipeline deal
International Business Times, 17 March 2016
Reports have emerged over the likelihood of India sealing a new deal with Iran that will see the construction of a direct 1,400-km undersea gas pipeline from the Iranian port city of Chabahar to the Gujarat coast.
The $4.5 billion gas pipeline project, when completed, will be able to transport up to 31.1 million standard cubic meters per day, the Tribune reported. The planned pipeline will be bypassing Pakistan's exclusive economic zone via the Oman Sea and Indian Ocean.
"Yes, the deal for the Iran-India undersea gas pipeline will be done. Matters have become easier as the U.S.-imposed economic sanctions on Iran have been lifted (on Jan. 16)," the Tribune reported, citing a top official in the Indian government.
The gas pipeline between India and Iran has been in negotiations for several years now and is of great strategic value to the Indian government. A final decision in this regard will boost Indian efforts find an alternate way to connect India to Afghanistan and Central Asia.
This pipeline was taken up following India's rejection of a similar project called Iran-Pakistan-India gas pipeline, which would have seen a pipeline built on shore via Pakistan. India pulled out of the project citing security and commercial concerns.
IANS had reported previously that the Iranian government was in negotiation with South Asia Gas Enterprise (SAGE) for the construction of the undersea pipeline and it will be leading an international consortium for building it.
Previously, India had agreed to invest around Rs. one lakh crore for the development of Iran's Chabahar Port, PTI reported. The Chabahar port has a special economic zone (SEZ).
India is also likely to fund a rail link between Chabahar and Zahedan in Iran. Zehedan is located at the tripoint of borders of three countries -- Iran, Afghanistan and Pakistan.
The rail link, when completed, will connect Chabahar to the International North–South Transport Corridor (NSTC) linking India, Iran, Azerbaijan and Russia. This link will reduce the transport cost for Indian products gaining access to Central Asia.
Further, it will also connect India to Afghanistan, given the fact that Zahedan is closer to the Afghanistan's strategic Zaranj-Delaram road (Route 606), which was built by India in record time.
Meanwhile, Oman too is expected to join the Iran-India gas pipeline at a later stage. Oman has positive and closer relationship with both Iran and India.
International Business Times