With India not indicating whether it would join the multi-billion dollar IPI gas pipeline venture, Pakistan has decided to go ahead with the project with Iran on a bilateral basis.
The federal cabinet, during a meeting chaired by Prime Minister Yousuf Raza Gilani, accorded approval to the construction of the Pakistan-Iran gas pipeline and gave the go-ahead for purchasing 750 million cubic feet of gas from Iran to fulfil growing local requirements.
Pakistani leaders have said that India has not given any clear indication about joining the 2,775-km-long pipeline project, costing $7.5 billion.
However, reports have suggested that India wants differences with Pakistan on transit fees and other issues to be resolved before it moves ahead with the project.
The cabinet also decided to finalise a gas import agreement with Iran and to use the imported gas for power generation in place of furnace oil, Information Minister Qamar Zaman Kaira told reporters here yesterday.
Though the price of Iranian gas would be comparatively higher, it would be cheaper than the furnace oil. The cabinet also decided to go in for aggressive exploration of natural resources to reduce the country's dependence on imported oil and gas, Kaira said.