Pakistan cancels multibillion-dollar gas pipeline project with Iran under US pressure: Report
This new information emerges at a time when Pakistan is working hard to get its cash-strapped economy back on track with the assistance of the International Monetary Fund, which has agreed to grant loans worth 3 billion US dollars.
ISLAMABAD: According to a media report on Monday, Pakistan has temporarily shelved the multi-billion dollar gas pipeline project to import inexpensive energy from neighbouring Iran, reportedly under pressure from the US, which has imposed sanctions against Tehran over its nuclear programme.
The change occurs as Pakistan strives to stabilise its cash-strapped economy with assistance from the International Monetary Fund, which agreed to grant loans totaling USD 3 billion.
The project was originally intended to be a gas pipeline connecting India, Pakistan, and Iran; however, India later withdrew, and it is now just a Pakistani and an Iranian project.
Pakistan has refrained from building the pipeline due to US sanctions against Iran over its nuclear programme.
According to the Dawn newspaper, Pakistan had informed Iran that it would be excused from fulfilling its contractual responsibility upon the completion of the multibillion-dollar Iran-Pakistan (IP) gas pipeline project due to external circumstances outside Islamabad’s control.
Pakistan has stated that it is unable to move forward with the project as long as US sanctions against Iran are in place or as long as Washington tacitly approves Islamabad moving forward with the project, which has been in limbo for almost a decade despite severe energy shortages in the 240 million-person South Asian nation, according to the paper.
According to a written statement made to the National Assembly by Minister of State for Petroleum Musadik Malik, “Pakistan has issued a Force Majeure and Excusing Event notice to Iran under the Gas Sales and Purchase Agreement (GSPA), which subsequently suspends Pakistan’s obligations under the GSPA.”
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