The Iran Pakistan pipeline that has been in discussion between the two governments as early as 1995 is finally to be constructed. China has played the hero without a cape once again and offered to finance the Pakistani un-built portion of the multibillion-dollar gas pipeline project. The news of the Ministry of Petroleum and Natural Resources’ intention to approach China to fund the IP gas pipeline has been making rounds since April 2015. Months of negotiating behind the scenes have paid off, as China will now fund the part of the pipeline that will cost up to $2 billion.
Dubbed the “Peace Pipeline,” the project hopes to improve the fragile ties between Pakistan and Iran, uneasy neighbours for decades as a result of Pakistan’s ties to Iran’s long-term adversaries, Saudi Arabia and the US. The US threatened Pakistan with sanctions if it decided to go ahead with the project in 2014 and hence, apart from the fact that Pakistan lacked the funds to complete its end of the project, it was under pressure to walk away from it at the cost of billions in fines to be paid to Iran from reneging over the contact.
For now, we can be optimistic that Beijing is investing in projects that will actually benefit the people in Pakistan; $15.5 billion in coal, wind, solar and hydro energy projects bound to come online by 2017, a $44 million optic fibre cable linking China and Pakistan, the $40 billion CPEC and now a $2 billion IP project. The pipeline can bring much-needed gas to Pakistan, which suffers from a crippling electricity deficit because of a shortage of fuel for its power-generation plants. Considering that the project would eventually supply Pakistan with enough gas to fuel 4,500 megawatts of electricity generation, almost as much as the country’s entire current electricity shortfall, it is necessary that this project not be politicised and delayed like CPEC or Kalabagh Dam.