IPI pipeline: Hardball Indian bargaining tactics, abscences from meetings, delays, and feigning disinterest are ploys to reduce the tariff 

India needs the gas. It does not have enough energy, however it wants to drive a hard bargain.

The Indians consider themselves to the best bargainers in the world. This can be seen at every Sabzi Mandi around the planet when the Indians are buying Okra. They pick each and every lady finger and try to break the tail to see if it is fresh. Pakistanis reach in and grab a fist full of Okra.

Indians have made some hard bargains recently–specially with the Russians. On the Aircraft carrier the Russians were able to reverse the low price and add 1.5 Billion Dollars to the original price.

On the IPI pipeline the Indians are trying to reduce the price of the tariff to less than $250 million whereas Pakistan had originally expected $1 Billion. To make the deal work and make the Indians part of the IPI deal Pakistan was ready to agree to a lower price. The Indians playing hardball decided to stay away from some of the meetings. Now they are back to the discussion table and expect to browbeat the Pakistanis on the price.

On Kashmir, each time India was in a fix and in positions of weakness, they agreed to everything—in 1948 agreeing to UN resolutions, then reneging on all of Nehru’s promises, in 1962 (war with China) again agreeing to almost everything, then reneging, in 1990 agree to resolving the situation then reneging, in 2004 asking Pakistan to end cross border infiltration then making no progress on it. All this has created 3 wars with Pakistan.

India tried the same tactics with China and ended up with a war with China.

Pakistan’s bargaining position was to invite China to the party.

Turkmenistan has been a favourite focus for large scale import of gas through a pipeline to be built across Afghanistan. Potentially, Tajikistan and Kyrgyzstan can export substantial quantities of electricity to Pakistan and India through Afghanistan. The Central Asian dream solution, however, has remained a hostage to three decades of turmoil in that strategic land bridge between South Asia and Central Asia. Meanwhile, things have not stood still in Central Asia with Russia, China and the West aggressively competing for energy pipelines from there. Tanvir Ahmad Khan,former ambassador and foreign secretary of Pakistan.

TAPI: A petroleum ministry official said India and Pakistan will also discuss issues related to the six-billion dollar, 2,000-km Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline project.

“Tapi is a parallel project that India and Pakistan are also discussing simultaneously,” he said.

India-Pakistan to resolve IPI tariff issues By our correspondent 12 April 2008ISLAMABAD – Pakistan and India have decided to resolve their differences over tariff and transit fee for the proposed Iran-Pakistan-India (IPI) gas pipeline project by holding talks in Islamabad on April 16-18.

Later the petroleum ministers of both Pakistan and India would meet on April 23 of this month to finalise the issue. Informed sources said on Thursday that technical teams of both the countries would meet to firm up their recommendations to be placed before the petroleum ministers of Pakistan and India who were scheduled to meet in Islamabad on April 23, 2008.

Both sides had earlier resolved their differences over the transportation fee and they now were focussing on tariff and transit fee issues for the Iranian gas to be transported to India through Pakistani border.

An official of the ministry of petroleum and natural resources when approached said that both the technical level and ministerial level talks were very important to finalise their talks on gas pipeline project after which further meetings will be lined up with Iran in May.

‘Iranian side will be briefed next month about the outcome of talks between Pakistan and India’, he said hoping that all the ‘lingering issues’ will be sorted out within this month between the two countries over the gas pipeline project costing $5.4 billion.

The official also said that both sides would also discuss issues concerning $6 billion, 2000 Km Turkemenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline project. “TAPI is a parallel project that India and Pakistan are also discussing simultaneously,” he said.

The Asian Development Bank (ADB), he said, is expected to invite the officials of all the all the four countries in the third week of this month to revive their dormant TAPI gas pipeline project to ease the energy crisis in the region.

However, there still existed various challenges to the TAPI project. They said the security situation in Afghanistan and relations between Pakistan and India need to improve and fuel subsidies in the two countries have to be phased out.

The TAP gas pipeline of 56 inch diameter needs at least 30 billion cubic meter (BCM) of gas per year from Turkmenistan to reach Pakistan via Afghanistan.

Sources also said that senior Pakistani officials have been informed by Iran that it has sorted out 40-50 per cent ‘logistic issues’ to undertake the work on Iran, Pakistan and India (IPI) gas pipeline.

Pakistan was told that Iran has asked India to join the project without caring for the opposition of the United States. India conceded that while it continued to face pressure from the United States ‘not’ to join the project, it cannot ignore its increasing gas requirements and that it was still interested to ‘pick up substantial quantities of gas from Teheran’.

Pakistan had also asked Iran to enhance gas volumes for Islamabad by 50 per cent under the pipeline project in case India stays away from the trans-national deal.

Pakistan would soon be making a formal request to the Iranian side to allocate an additional volume of 1.05 BCFD (billion cubic feet of gas per day), to Pakistan in case India does not join the project.

Originally, Pakistan was to get a total of 2.1 BCFD of gas from the 2600-km Iran-Pakistan-India pipeline project and India was to receive 3.2 BCFD, making total to 5.3 BCFD. The pipeline length will come down to about 1600-km, resultantly reducing the project cost, in case India decides to stay away. Gas volumes to Pakistan would, therefore, increase to about 3.2 BCFD.

Sources also said that in the absence of both Iran and Turkmenistan gas pipeline projects, the government has started working on another project to meet its growing gas requirements.