After a lengthy hiatus, Pakistan’s decision to move forward with the Iran-Pakistan gas pipeline project marks a significant development after 15 years. Recent reports reveal that Pakistan has committed to commencing the construction of an 81 km pipeline from the Iranian border to Gwadar, affirming its commitment to the project’s execution. This pivotal resolution was reached by the energy committee of the supervisory federal cabinet, with estimates suggesting the project will incur a cost of approximately 45 billion rupees.
Pakistan’s pressing need for gas to address its national requirements is undeniable. The growing disparity between supply and demand underscores the urgency of the situation, with both commercial and residential users grappling with numerous challenges. While Pakistan relies considerably on domestic gas sources, dwindling reserves have necessitated gas imports from various channels to bridge the widening gap in demand. However, declining local gas production has further complicated the gas crisis.
Faced with the daunting task of meeting the burgeoning gas needs of its populace, Pakistan has explored importing options from Qatar, Azerbaijan, Central Asia, and neighboring Iran. Among these, importing gas from Iran presents a comparatively cost-effective solution. Despite Western pressure deterring this option previously, Pakistan’s decision to revive the project is indeed laudable.
Resuming the Iran-Pakistan gas pipeline project not only promises affordable gas supply tailored to the country’s needs but also reinvigorates stalled industrial activities due to the gas shortage. Moreover, it allows Pakistan to evade a substantial $18 billion penalty imposed by Iran for the project’s delay and secure 750 million cubic feet of gas at highly competitive rates compared to LNG.
Urgent action is required to expedite not only the completion of CPEC projects but also initiatives like the IP-gas pipeline, by steadfastly rejecting external pressures and pivoting away from a Western-centric approach. The country’s economic prosperity hinges on prioritizing regional partnerships and independent decision-making.
