Saudi grant kills Iran-Pakistan pipeline

[unhappycamper]

http://atimes.com/atimes/South_Asia/SOU-02-210314.html



Saudi grant kills Iran-Pakistan pipeline
By Syed Fazl-e-Haider
Mar 21, '14

KARACHI - A US$1.5 billion donation to Pakistan from Saudi Arabia is hotly being debated in the country's parliament, political circles and among the analysts. The main question being under what deal Riyadh disbursed the crucial amount to help the cash-strapped country make short-term economic gains? What has Pakistan guaranteed or promised to do in return? Many believe Saudi Arabia killed many birds with one stone.

Saudi Arabia did what the US could not do to keep Pakistan away from a $7.5-billion gas pipeline project with Iran. In a tit-for-tat deal, Saudi Arabia might have persuaded Islamabad to cancel the Iran-Pakistan (IP) pipeline project, which is vital to end energy shortages that are crippling Pakistan's economy.

Pakistan's oil minister Shahid Khaqan Abbasi, after receiving funds from Saudi Arabia last month, reportedly said work on the pipeline was not possible because of sanctions imposed by the United States and the European Union on Iran over its nuclear program. Iran has warned that Islamabad is contractually obliged to complete the project which would allow Tehran to export gas to its southeastern neighbor.

"Iran has carried out its commitments ... and expects the Pakistani side to honor its own," Iran's deputy oil minister Ali Majedi was reported to have said. "They should even pick up the pace of work and make up for falling behind schedule in constructing Pakistan's (780-kilometer) side of the pipeline."