Pipeline hinges on LNG deal, India tells Iran

India has taken a tough stance on Iran's existing gas supply commitments. Petroleum Minister Murli Deora has made it clear to Iran that the proposed Iran-Pakistan-India pipeline would be possible only if Iran agreed to supply 5 million tonnes of liquefied natural gas as per the contract signed last year.

An Indian delegation, led by Petroleum Minister Murli Deora, told the Iranian side in Doha that it would be difficult to get the Cabinet to approve the pipeline project if earlier contracts were not honoured, petroleum ministry sources said.

The delegation was in Doha to attend a three-day International Energy Forum (IEF) meeting. Deora had also met his Pakistani and Iranian counterparts""Amanullah Khan Jadoon and Kazem Vaziri.

In fact, last year itself, India had expressed its inability to go in for the gas pipeline project without resolution of the LNG issue. This was communicated to Iran by the then petroleum minister Mani Shankar Aiyer. Though Deora has not diluted the earlier stand, he is willing to hold discussions to persuade the Iranian side.

In his meeting with Iranian Deputy Oil Minister Mohammad-Hadi Nejad Hosseinian yesterday, Deora cited several other contracts like the one with Qatar where gas was being supplied at the contracted price despite rise in international prices.

Though India has set up a joint working group and appointed consultants for the proposed pipeline, the project will still need a Cabinet approval.

There have been instances, the latest one being ONGC Videsh's bid to acquire a Nigerian block, where the Cabinet rejected the proposal at the last minute, as it was not sure of the nature of investment.

Meanwhile, Iran is in a hurry to seal the pipeline deal, as its construction coincides with its internal pipeline project, for which the budgetary allocation has been approved by its Parliament.