It was smiles and handshakes all around on Pakistan’s border with Iran on March 11, as the presidents of the two countries posed to mark the start of the construction of the Pakistani part of a pipeline that is supposed to bring Iranian natural gas to a country starved for energy. Blackouts cripple industry and bring daily misery to Pakistani households. The new pipeline is supposed to be completed by the end of 2014.
Ending misery appears not to be among the chief political motives for the project, however. Rather, Iran hopes that the project will lessen the country’s international isolation. Pakistan’s relations with its neighbour usually have been chilly, but under President Asif Ali Zardari they have warmed.
That is indicative of Pakistan’s tilt away from the United States, which lobbied the government in Islamabad against the deal and has been pushing the idea of an alternative pipeline running from Turkmenistan, through war-ravaged Afghanistan and then into Pakistan and India. Instead Pakistan also has begun talks with Iran about an oil refinery at its Persian Gulf port of Gwadar. Pakistan recently decided to hand control of the new deep-sea port there to the Chinese, another development that concerns the United States, not to mention India.
The new pipeline comes from the giant South Pars gas field and will snake into southern Pakistan. Iran already has built all but the final 300 kilometres of its section of the pipeline, according to Deputy Oil Minister Javad Owji. Now Pakistan has to build about 800 kilometres.
That the Pakistani leg of the pipeline has to pass through the insurgency-ridden province of Baluchistan is only one cause for doubting its completion. It is also not clear how Pakistan, which is strapped for cash, will finance its part of the pipeline, especially if hit by international sanctions for dealing with Iran.
What is more, the current government, led by Zardari’s Pakistan Peoples Party, is on its way out of office. According to polls, the opposition party of Nawaz Sharif, who is close to Iran’s foe, Saudi Arabia, is likely to lead the next government after an election, likely in May.
For five years Zardari’s administration has sat on the country’s energy crisis, with little action beyond get-rich-quick schemes for his cronies. The Iranian gas is not cheap. Exploiting Pakistan’s domestic reserves, which produce gas at about half the price, has been neglected. So too have imports of liquefied natural gas. Little has been done to deal with appalling inefficiencies in the country’s electricity system.
Even though the announcement of the Iranian pipeline looks like a gimmick, however, the Americans’ idea of gas all the way from Turkmenistan is a pipe dream. Beleaguered Pakistanis have longer to wait before gas flows into homes, before blackouts are a thing of the past.
— The Economist