World Bank open to funding IPI pipeline

May 2, 2007 at 11:03 AM
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ISLAMABAD, Pakistan, May 2 (UPI) -- The World Bank may fund either a gas link from Iran to India via Pakistan or one from Turkmenistan to India via Afghanistan and Pakistan, a bank official said.

"If Pakistan would come to ask for funding for any of the pipelines, the World Bank would seriously consider extending the funding," World Bank Vice President Praful Patel said in Islamabad.

The comments were reported by India's semi-official Press Trust of India.

Patel noted, however, that the bank has not been formally or informally approached about the project.

"IPI gas pipeline project is a win-win project for Pakistan and India besides being good and quite feasible in catering the energy needs of Pakistan and India," Patel said.

The $7.4 billion, 1,700-mile pipeline would run from Iran to India via Pakistan and supply some 90 million cubic meters of Iranian gas to India and 60 million cubic meters to Pakistan every day. Talks have been stalled on that issue because of two factors: the price of Iranian gas and transit fees that India must pay to Pakistan.

Iran wants to sell natural gas to the two countries at $4.93 dollars per mBtu, using the price of oil at $60 per barrel as a benchmark.

The future of the IPI pipeline is uncertain, however, because of strong U.S. opposition to the deal and the fact that funding may be difficult because of the countries any pipeline would traverse. Washington has said it backs a pipeline that supplies Turkmen gas to South Asia.

Both plans, however, have serious security implications because of the countries they traverse.

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