Right time for India to revive trade with Iran, says industry body
Removing trade restriction from Iran by the United Nations Security Council has opened up huge opportunity for India to import natural gas from Iran without involving Pakistan, an industry body said. “Lifting of Western sanctions now holds the promise of starting an undersea pipeline project that would bring Iranian gas to Porbandar port in Gujarat bypassing Pakistan, which has been the main sticking point for the other multilateral projects of Turkmenistan-Afghanistan-Pakistan-India (TAPI) and Iran-Pakistan-India (IPI),” said Associated Chamber of Commerce & Industry (ASSOCHAM) in its study on ‘India’s Trade with Iran’. With the IPI still stuck and the TAPI project yet to take off, the South Asia Gas Enterprises Pvt Ltd (SAGE) proposed an undersea pipeline bypassing Pakistan’s Exclusive Economic Zone (EEZ) to transport up to 1.1 billion standard cubic feet of gas per day from Chabahar in Iran and Ra’s al Jifan in Oman to Porbandar in Gujarat. The SAGE pipeline, also called Middle East to India Deepwater Pipeline (MEIDP) project, would start from Chabahar on the southern coast of Iran and Ras Al-Jafan on the Oman coast, which after deep traversal in the Arabian Sea, would bring gas to Porbandar in south Gujarat. The 1,200-1,300-km pipeline proposed by SAGE is estimated to cost around $4.5 billion. To increase merchandise trade, India should also look for Preferential Trade Agreement (PTA) with Iran as the similar Iranian arrangement with Pakistan has become almost dead. India must fully exploit the economic opportunities unfolding from lifting of western sanctions on Iran , bypassing Pakistan for import of natural gas as also enhancing merchandise trade through a PTA with the key West Asian strategic nation, the study said. “Given the kind of serious political problems, the proposed pipeline projects involving Pakistan, it is feared, may remain the pipe dream. All other viable alternatives to enhance India’s energy security must be explored,” said D S Rawat, Secretary General, ASSOCHAM. In 2008, a consortium of India’s ONGC Videsh, Oil India and India Oil Corporation had discovered gas in the Farzad-B block in Iran and subsequently prepared a field development plan to recover about 12.8 trillion cubic feet of gas and has already spent $90 million on exploration. However, the project was abandoned following sanctions imposed on Iran. “India should also revive stranded oil and gas projects that were stalled due to international sanctions on Iran,” the study added.
August 31, 2015 | 4:46pm IST.
to success.