Pakistan-Iran

Gas Pipeline Progress

Decision on Pipeline
Construction
• The Iran-Pakistan pipeline, also known as the Peace Pipeline, emerged from a
plan dating back to 1994
• The project aimed to transport gas from the South Pars Gas Fields through
Baluchistan but faced numerous challenges and delays over the years.
History:
• In 2008, a deal between Iran, Pakistan, and India nearly materialized, but India
opted for an alternative pipeline project (TAPI) due to sanctions on Iran and
pressure from the United States.
• Iran and Pakistan proceeded with the project after India's withdrawal, signing a
deal in 2009, but construction delays ensued.
• U.S. sanctions on Iran in 2012 and Pakistan's agreement to import gas from Qatar
in 2015 further hindered progress on the pipeline.
• Construction of Iran's section was completed, but Pakistan's portion has faced
ongoing delays and suspension due to international sanctions on Iran.
• the project remained stalled until the approval of constructing an 80 km section
within Pakistan in February 2024.
 Recognition and Cooperation (1947): Iran's early recognition of
Pakistan established a foundation for diplomatic ties. Both countries
cooperated economically, forming alliances in areas such as
countering the drug trade and addressing insurgency in Balochistan.
Legal and Cold War Dynamics (1945–1991): Iran and Pakistan were part of the
Diplomatic Western Bloc during the Cold War, being founding members of
CENTO. Iran also supported Pakistan in the Indo-Pakistani Wars of

Implications 1965 and 1971.

between War on Terror (Post-9/11): Following the September 11 attacks, Iran

and Pakistan collaborated in the war on terror. Pakistan mediated in
the Iran–Saudi Arabia proxy conflict.
Iran and
Pakistan China–Pakistan Economic Corridor (CPEC): Iran has expressed interest
in joining CPEC, part of the Belt and Road Initiative. This demonstrates
a potential for economic collaboration beyond the region.
 Legal and Diplomatic Implications
between Iran and Pakistan
Current situation related to the
project The Pakistan government
has given approval for the
Afghanistan Cooperation (2020s): construction work on its section of
With the U.S. withdrawal and the the Iran-Pakistan (IP) gas
Taliban's return to power, Pakistan pipeline.The approval for the initial
increased cooperation with Iran to phase of the 80-km segment within
promote peace and stability in Pakistan was granted by the
Afghanistan, emphasizing the Cabinet Committee on Energy
avoidance of geopolitical rivalry (CCOE) of the interim government,
just days before the new
government takes office after the
February 8 elections.
 Consistency with Political
Manifesto:
The outgoing caretaker government has decided
to move forward with the Iran-Pakistan gas
pipeline project, indicating alignment with their
political agenda.
The incoming administration is expected to
continue supporting the project, as there should
be no contradictions between the caretaker
administration's decision and the new rulers'
policies, as stated in the PML-N's election
manifesto.
Economic Rationale for Gas
Importation:
Pakistan needs regular and affordable access to
natural gas due to dwindling local supplies not
meeting demand, leading to gas load-shedding
in both domestic and industrial sectors,
especially during winter.
Importing Iranian gas is seen as a sensible
economic decision to address Pakistan's energy
needs.
Geopolitical 1-energy security

consideration 2-iran role as a supplier

3-impact of sanctions
and fear of 4-diplomatic maneuvering
sanctions: 5-regional dynamics
comparison Comparing Pakistan's trade policies, particularly regarding the
Pak-Iran gas pipeline project, with those of other nations can

with other provide insight into how different countries navigate geopolitical
considerations and the fear of sanctions in their trade

nations trade relationships.

Here's a brief comparison:

policies 1-united states

2-china
3- European union
4-Russia
 Recommendation for Moving Forward
Start construction on the 80-km segment from the Pakistan-Iran border to Gwadar
• This involves initiating the physical construction work on the specified portion of the Iran-Pakistan gas pipeline
project, beginning from the border with Iran and extending towards the port city of Gwadar in Pakistan.
Fund the project through the Gas Infrastructure Development Cess (GIDC)
• The project's financial requirements will be met by utilizing funds generated through the Gas Infrastructure
Development Cess, which is a levy imposed on gas consumers in Pakistan for the development of gas
infrastructure in the country.
Obtain legal waivers and opinions from foreign legal counsel
• Legal waivers and opinions will be sought from foreign legal experts to navigate any potential legal challenges or
complications associated with the project, particularly regarding international agreements, sanctions, and
contractual obligations.
Defer filing waiver application with US authorities due to the current geopolitical situation:
• Given the existing geo-political circumstances, the filing of the waiver application with US authorities, which could
be related to sanctions or other regulatory matters, will be postponed until the situation becomes more
favorable or stable.
Thankyou