Senate panel summons FO, AGP over US objection to Iran-Pakistan gas pipeline

ISLAMABAD: The Iran-Pakistan gas pipeline project has come under scrutiny in the Upper House of Parliament, with members seeking details of objections raised about the project by the United States and the implications of these objections.

The Senate Standing Committee on Cabinet Secretariat has taken action by summoning the Ministry of Foreign Affairs and the Attorney General for a hearing on the matter.

During the committee meeting on Wednesday, the joint secretary petroleum provided an overview of the situation. He highlighted that US sanctions related to the Iran gas pipeline have deterred potential stakeholders from coming forward.

He said that Iran has set a deadline for the project’s completion by 2024, and failure to meet this deadline could result in penalties. Efforts are currently under way to reinitiate negotiations for the Iran-Pakistan gas pipeline, and discussions are being held with relevant authorities in Iran, he said.

The official said that the urgency to secure a reliable gas supply is driven by the potential liability Pakistan may face, amounting to $20 billion, in the event of project failure.

The official stated that the Ministry of Foreign Affairs has received correspondence from the United States on multiple occasions. In response, Senator Mushtaq Ahmed said that the Ministry of Foreign Affairs be summoned to shed light on the obstacles preventing access to affordable gas from neighboring countries.

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Sadia Abbasi, Chairperson of the Senate Standing Committee on Cabinet Secretariat, expressed frustration with the Ministry of Foreign Affairs’ inaction, contrasting it with India’s unhindered activities in the region. She directed the committee to also summon the Ministry of External Affairs and the Attorney General to provide clarity on the matter.

Committee members questioned how the gas pipeline deal was struck despite the numerous restrictions, a situation they considered unprecedented. Officials explained that the agreement was forged many years ago, with Senator Waqar Mehdi mentioning that it was established during Asif Ali Zardari’s government.

Chairman Nepra (National Electric Power Regulatory Authority) also provided a briefing during the committee session. He revealed that due to economic conditions, electricity prices have risen, placing an additional burden of 236 billion rupees on consumers.

Chairman Nepra emphasized that even a slight depreciation in the rupee’s value, by just one rupee, adds an extra 18 and a half billion rupees in costs. He stressed that the authority cannot control economic indicators, and increasing capacity will result in higher tariffs rather than lower ones. Additionally, he noted that while energy costs have been calculated, capacity payments have increased.