Iran cancels Pakistan gas pipeline loan

Society Pakistan & World Affairs
1

On one hand people were instigating against PPP government and playing Punjabi card for not doing anything to tackle energy crisis, on the other hand same people are now responsible for flushing that already billions dollars spent project in to gutter. Instead of this arse hole PM of Pakistan spending billions in stupid projects, why can not he spare money for this most needed project? I just don’t understand this Paki mentality.

Iran cancels Pakistan gas pipeline loan - DAWN.COM

TEHRAN: Iran says it has canceled a planned $500 million loan to Pakistan to build part of a pipeline to bring natural gas from Iran.

Deputy Oil Minister Ali Majedi says Iran has no obligation to finance the Pakistani side of the project and also doesn’t have the money. Majedi’s comments were posted on the oil ministry’s website, shana.ir, Saturday.

“Pakistani officials were told in recent talks that, given the sanctions, Iran is not able to finance construction of the pipeline (in Pakistan) and has no obligation to do so,” he said.

He said Tehran will demand compensation if Islamabad fails to take Iranian gas by end of next year.

Under a valid contract, Pakistan is required to finish construction of the pipeline on its territory by the end of 2014.

“If a contractor is chosen today and pipeline construction begins today, it will take four years to complete it. Should Pakistan fail to take gas by the end of next year, Iran will demand compensation under the terms of the contract,” he said.

Pakistan has welcomed an Iranian offer to approach third parties, including European companies, to finance the project.

The Iran-Pakistan pipeline is designed to help Pakistan overcome its mushrooming energy needs. Pakistanis experience frequent blackouts.

Iran has already invested over $2 billion to construct the Iranian side of the pipeline. But there are serious doubts about how Pakistan could finance the $2 billion needed to construct the pipeline, which also faces US opposition.

2

Re: Iran cancels Pakistan gas pipeline loan

2 billion dollar is a big amount.

3

Re: Iran cancels Pakistan gas pipeline loan

False impression being given by the OP

This loan was never agreed or part of the agreement. Pakistan requested iran to give the loan because pakistan was finding it difficult to finance it. Iran said it is not willing to give this loan...as it was not obligated to do so.........

4

Re: Iran cancels Pakistan gas pipeline loan

PPP was being rightly criticized as forget starting the work on the pipeline, the government was such cowards that they didn't even sign the contract until the end of the government when they knew that they won't be coming back to power.

5

Re: Iran cancels Pakistan gas pipeline loan

^ thats the real thing. Neither was PPP interested in this project nor this one. PPP signed the agreement at the end of their tenure so as to make this a problem for the incoming government. The current government is not serious in completing this project, due to their relationship with Saudia. It would be interesting what would happen if the project is not completed at the stipulated time.

6

Re: Iran cancels Pakistan gas pipeline loan

So those coming to power after using Punjabi card, what stopped them not to go through this project? Instead of corrupt haram khori schemes like easy loan of 2 millions, why this government can spend $2 billions to continue the project on which billions of dollars already spent.

7

Re: Iran cancels Pakistan gas pipeline loan

What false impression? Why Iran has to pay for obligation of Pakistan as per contract? This kind of policy of N$ violating the contract will leave Pakistan no where. People of Punjab will suffer more on account of this.

8

Re: Iran cancels Pakistan gas pipeline loan

I was under the impression Pakistan was being ripped off by Iran?

9

Re: Iran cancels Pakistan gas pipeline loan

You do know that is 2 million dollars which is a lot lot less than 2 billion dollars right?

10

Re: Iran cancels Pakistan gas pipeline loan

It is not 2 million dollar scheme it is 100 billions i.e. One Billion dollar waste scheme. Can’t this ganja get hold of one more billion to continue this project which will benefit all people of Pakistan?

Youth business loan scheme announced by PM - thenews.com.pk

Addressing party workers in Gilgit Baltistan, Prime Minister Sharif said the youth business loan scheme was being started with a **fund of Rs 100 billion **and forms will be available in the next few days. Under the scheme, those between the ages of 21-45 will be able to apply for loans.

11

Re: Iran cancels Pakistan gas pipeline loan

Rupees VS. dollars ? :hehe:

12

Re: Iran cancels Pakistan gas pipeline loan

Welcome to the land of andher nagri chopat raja

13

Re: Iran cancels Pakistan gas pipeline loan

In last financial year (July 2012 to June 2013) Pakistan imported ~$15 billion worth of petroleum products ($9.5 billion) and crude oil (~$5.4 billion). If Pakistan would start taking gas from Iran then petroleum related import would reduce. From what I understand, saving could be $2 billion a year, and that means, import bill would reduce by $2 billion a year. Electricity generation cost would reduce and it would also help in reducing gas shortages in the country.

So, after investing $2 billion Pakistan would start saving more than $2 billion a year in reduced petroleum related imports and also reduced electricity generation cost, and that means investment getting amortised within one year.

If Pakistan would renegotiate gas tariff with Iran (that Pakistan should try), than saving would be much higher.

I believe, Pakistan can also negotiate with Iran to not take payment of gas Pakistan would import in hard currency (dollars). Pakistan can propose that instead of hard currency (dollars) Iran can take payments in Rupee and commodity (cotton, rice, sugar, wheat, or whatever). If not all, then payment in hard currency to Iran should be at most 30 % of gas import bill. Iran can use Rupee they would earn to Import goods from Pakistan or hire Pakistani workers to work in Iran and pay half to 70 % of their wages in Rupee (that Iran would have as payment for Gas sale to Pakistan) and remaining 30 % in Iranian currency.

If Pakistan would succeed in negotiating payment in rupee and commodity, than Pakistan would save many billions of dollars from import bill, and would also earn due to Iranian imports of commodity from proceed of gas sale to Pakistan and hiring Pakistani workers.

14

Re: Iran cancels Pakistan gas pipeline loan

Why don’t they use Thar coal instead? Pak has one of the biggest reserves..

Thar Coal and It’s Development P 1 - YouTube

15

Re: Iran cancels Pakistan gas pipeline loan

^^^ Cost of producing electricity from Thar coalwould cost lot of initial investment (amortization of initial investment couldbe many years), plus investment would start years before actually electricityis produced. Unfortunately most political governments want quick return andcould not wait years after investing to see reward of electricity (asgovernment that invested may not be there when reward would start showing).

16

Re: Iran cancels Pakistan gas pipeline loan

All the ways Pakistan can "save" are dandy, but Pakistan didn't negotiate anything when PPP signed the govt. Now, cue the jiyalas and they will start defending anything PPP did even if meant that khomeni was sending his urine instead of gas down the line.

I don't know why Pakistan didn't negotiate better with Iran. Ok, Pakistan is no China (rumored to be getting cheap oil), but Pakistan would be route that india or china could get gas in the future. Now, the gas is pegged to at least 70% of international crude prices. There are different crude types like sweet crude (more in demand) so I wonder what price the crude is pegged to in this deal?

Considering the traitorous people that have been in power especially in the last PPP govt, I am well within reason to assume that Pakistan "negotiated" the worse deal possible for the benefit of Pakistanis

17

Re: Iran cancels Pakistan gas pipeline loan

Iran warns Pakistan of cash fine over pipeline delay - PakTribune

18

Re: Iran cancels Pakistan gas pipeline loan

It is 80%. PPP knew their government is going to end soon and there is no way they could return to power and fulfill such commitments.

Iran pipeline will be Pakistan’s Enron - Economic Times

19

Re: Iran cancels Pakistan gas pipeline loan

That means another IPP sort of deal for Pakistanis (not surprisingly the players are the same in both cases). Like one was not enough already.

20

Re: Iran cancels Pakistan gas pipeline loan

We hav to c our intreast. Iran gas pip line deal was nt in our favour cz it was expensive. We should focous on d gas of central asian countries cz they r offring gas at cheap rates.