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Energy will spur India-Pakistan trade, says Aiyar

* Indian petroleum minister says US has not raised concern over trade with Iran
* Pakistan could import diesel from India

By Mohammed Rizwan

LAHORE: Indian Petroleum Minister Mani Shankar Aiyar has said that as the focus of energy production and consumption shifts from the West to Asia, hydrocarbon products could be the single most important item of trade between Pakistan and India.

“The atmosphere in South Asia has improved to a point where there could be a continental energy cooperation in Asia where Pakistan could be an important route of energy for India and India could ship diesel to Pakistan through its refineries located near the border,” Aiyar told reporters and civil society representatives.

Aiyar arrived in the city this afternoon on his way to Islamabad where he is scheduled to hold talks with his Pakistani counterpart on different gas pipeline options. Foremost among these is a proposed Iran-Pakistan-India gas pipeline.

The US has expressed its concerns over India’s intention of buying gas from Iran, with whom Washington has serious differences over nuclear proliferation issues.

“The US has not raised its concern with us on a state-to-state basis so far. The US ambassador once raised the question with me and I told him that India was aware of US concerns and I am sure the US would be aware of India’s (energy) requirements,” Aiyar said Aiyar.

Aiyer said that India needed 170 million cubic feet of natural gas per day and by 2020, the requirement would be 400 million cubic metres. “If the economy grows at the same pace – seven to eight percent – India will have a huge energy deficit in 15-20 years. Pakistan will be in a similar situation and would also have to import its energy by then. So it’s a matter of common interest for both countries,” he said.

The minister said that during talks with his Pakistani counterpart, the possibility of exporting diesel to Pakistan through border refineries would also be discussed. “Instead of the Gulf, Pakistan could import diesel from Indian refineries, which is a cheaper option. The refineries of Jampur and Bathinda could supply the product, first through tankers and later perhaps through a pipeline,” Aiyar said.

In response to a question, Aiyar said the proposed diesel sale did not come with any strings attached. “No, there are no conditionalities, and it will be an open discussion,” he said.

“India only produces seven percent of its energy requirements. So we’ll be looking at all the options, including importing gas from Central Asia and the Gulf through Pakistan. They are not alternatives rather they are complements of discussions,” he said.

The minister said the process of peace and economic cooperation should not be deterred by anything. “The dialogue must continue and the process must go on. There is already a completely changed environment in South Asia and we can build on it,” Aiyar said.

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