Pakistan, Iran issue joint statement on gas pipeline project

ISLAMABAD: Pakistan and Iran agreed to expeditiously finalize the Free Trade Agreement (FTA) and boost their bilateral trade to USD10 billion over the next five years through joint economic projects.

According to the joint statement issued here, both sides affirmed their commitment to transform their common border from ‘border of peace’ to a ‘border of prosperity’ through joint development-oriented economic projects, including setting up of joint border markets, economic free zones, and new border openings.

The bilateral ties and cooperation was discussed during the delegation-level talks between Prime Minister Shehbaz Sharif and Iran’s President Dr. Seyed Ebrahim Raisi who was on an official visit to Pakistan from April 22-24, accompanied by a high-level delegation comprising Foreign Minister Amir Abdollahian, as well as other members of the cabinet and senior officials.

Agreeing to turn the common border from a ‘border of peace’ to a ‘border of prosperity’, both countries reiterated the importance of cooperation in the energy domain, including trade in electricity, power transmission lines and Iran-Pakistan Gas Pipeline Project.

Both sides underscored the imperative of a long-term durable economic partnership and collaborative regional economic and connectivity model, particularly for socio-economic development in Iran’s Sistan-Balochistan and Pakistan’s Balochistan provinces.

The two sides reviewed the entire spectrum of Pakistan-Iran bilateral relations, exchanged views on regional and global issues of mutual concern, and signed multiple accords.

Pakistan and Iran reiterated their commitment and dedication to further strengthening the bilateral fraternal relations by promoting academic, cultural and tourism activities, and enhancing tourism to historic religious sites.

Both leaders reiterated the importance of forging regular cooperation and exchange of views between political, military and security officials of the two countries to combat threats such as terrorism, narcotics smuggling, human trafficking, hostage-taking, money-laundering and abduction.

For swift finalization of FTA, both sides agreed to hold the next sessions of Annual Bilateral Political Consultations (BPC) and Joint Business Trade Committee (JBTC) as well as the 22nd round of the negotiations of the Joint Economic Commission (JEC) soon.

They also agreed to facilitate the regular exchange of economic and technical experts, as well as delegations from chambers of commerce from both countries to intensify economic cooperation.

The declaration of ‘Reemdan border point’ as an international border crossing point under TIR and opening of the remaining two border sustenance markets was also agreed upon.

There was consensus to fully operationalize barter trade mechanisms between the two sides to facilitate economic and commercial activity, particularly under ongoing collaborative endeavours, such as border sustenance markets.

Regarding connectivity, two sides expressed satisfaction over the regular shipment of goods under the TIR Convention and agreed to fully operationalize the Convention for further efficient, speedy and barrier-free trade.

As members of Belt and Road Initiative (BRI) and Economic Cooperation Organization (ECO), the two countries expressed firm resolve to enhance cooperation in connectivity, infrastructure development and energy sectors and agreed to expand linkages between Gwadar and Chahbahar ports.

The two countries condemned terrorism in all its forms and manifestations, and agreed to adopt a collaborative approach to confront this menace and to leverage the existing bilateral institutional mechanisms to effectively combat and counter this threat, while fully upholding the principles of the UN Charter, particularly the principles of sovereignty and territorial integrity of member states.

Taking note of developments at regional and global levels, both sides stressed the importance of peaceful settlement of disputes through dialogue and diplomacy to find mutually acceptable solutions to common challenges.

The two leaders highlighted the need to resolve the issue of Kashmir through dialogue and peaceful means based on the will of the people of that region, and in accordance with international law.

They expressed their strong and unequivocal condemnation of the ongoing Israeli regime’s aggression and atrocities against the Palestinian people, and called for an immediate and unconditional ceasefire, unimpeded humanitarian access to the besieged people of Gaza, return of the displaced Palestinians, as well as ensuring accountability of the crimes being committed by the Israeli regime.

Both sides expressed satisfaction over close bilateral ties in all mechanisms of SCO and underscored the importance of early resumption of the activities of the SCO-Afghanistan Contact Group to coordinate efforts to maintain stability and develop economic ties in the region.

They also called for active cooperation among the regional countries within the framework of ECO. Pakistan and Iran reaffirmed their commitment to the development of Afghanistan as a peaceful, united, sovereign and independent state, free from the threats of terrorism and drug trafficking.

Noting that the existence of terrorist organizations in Afghanistan posed a serious threat to regional and global security, the two sides reaffirmed their willingness to enhance cooperation on counter-terrorism and security and to develop a united front against terrorism.

President Raisi also met President Asif Ali Zardari, Senate Chairman Yusuf Raza Gilani and National Assembly Speaker Sardar Ayaz Sadiq. The two sides expressed their agreement to release each others’ prisoners and take measures for their extradition based on the Treaty for the Extradition of Criminals and the Accused between Iran And Pakistan approved by the two countries in 1960 and the Agreement on the Transfer of Convicts between the two countries approved in 2016.

Both sides strongly condemned the attack on the Consular Section of the Iranian Embassy in Damascus and called it a violation of international law and the UN Charter, as well as illegal under the Vienna Convention on Diplomatic Relations of 1961.

Two leaders called on the UN Security Council to prevent the Israel regime from its adventurism in the region and its illegal acts attacking its neighbours and targeting foreign diplomatic facilities.

Pakistan and Iran condemned rising incidents of Islamophobia, desecration of the Holy Quran and sacred symbols in some countries, and welcomed the adoption of the UN General Assembly Resolution 78/264 titled “Measures to Combat Islamophobia” in this regard and called for an early appointment of a United Nations Special Envoy to combat Islamophobia.

Prime Minister Shehbaz and President Raisi welcomed all dimensions of the cooperation between the two countries in multilateral fora including the UN, ECO, SCO, OIC, D-8 Organization for Economic Cooperation, Asia Cooperation Dialogue (ACD), initiatives of the Meeting of Foreign Ministers of Afghanistan’s Neighboring Countries and others.

They also expressed their agreement to start negotiations on free trade in ECO. President Raisi paid homage to Allama Muhammad Iqbal as he visited Allama Iqbal Mausoleum in Lahore.

In Karachi, he attended a wreath-laying ceremony at Mazar-e-Quaid. He also addressed a widely attended meeting of business people from both sides in Karachi. President Raisi also extended invitations to the president and the prime minister of Pakistan to pay official visits to Iran.

Here are some facts about IP gas pipeline project:

– The pipeline deal, signed in 2010, envisaged the supply of 750 million to a billion cubic feet per day of natural gas for 25 years from Iran’s South Pars gas field to Pakistan to meet Pakistan’s rising energy needs.

– The pipeline was to stretch over 1,900 kilometres (1,180 miles) – 1,150 km within Iran and 781 km within Pakistan.

– Tehran says it has already invested $2 billion to construct the pipeline on its side of the border, making it ready to export.

– Pakistan, however, did not begin construction and shortly after the deal said the project was off the table for the time being, citing international sanctions on Iran as the reason.

Iran’s oil minister at the time responded by saying that Iran carried out its commitments and expects Pakistan to honour its own, adding that Pakistan needs to pick up the pace of work.

– In 2014, Pakistan asked for a 10-year extension to build the pipeline, which expires in September this year. Iran can take Pakistan to international court and fine the country. Local media reported that Pakistan can be fined up to $18 billion for not holding up its half of the agreement.

– Faced with a potential fine, Pakistan’s caretaker administration earlier this year gave the go ahead in principal to commence plans to build an 80 km segment of the pipeline.

– In March, Islamabad said it would seek a U.S. sanctions waiver for the pipeline. However, later that week, the U.S. said publicly it did not support the project and cautioned about the risk of sanctions in doing business with Tehran.

– Washington’s support is crucial for Pakistan as the country looks to sign a new longer term bailout program with the International Monetary Fund (IMF) in coming weeks.

– Pakistan, whose domestic and industrial users rely on natural gas for heating and energy needs, is in dire need for cheap gas with its own reserves dwindling fast and LNG deals making supplies expensive amidst already high inflation.

– Iran has the world’s second-largest gas reserves after Russia, according to BP’s Statistical Review of World Energy, but sanctions by the West, political turmoil and construction delays have slowed its development as an exporter.

– Originally, the deal also involved extending the pipeline to India, but Delhi later dropped out of the project.