Pakistan has decided to boycott the 22 August talks about the TAPI (Turkmenistan, Afghanistan, Pakistan and India) pipeline project. This comes in the wake of violation of the line of control agreement between India and Pakistan. Both sides have launched attacks at each other during the last few weeks resulting in several casualties on both sides of the border.
The on-going peace process between both India and Pakistan has, as a result of this border confrontation, come to a halt. The TAPI pipeline runs from Turkmenistan through the war plagued Afghanistan to Pakistan and end at India.Turkmenistan holds the fourth largest reserves of natural gas and the pipeline is supposed to supply natural gas to Afghanistan, Pakistan and India. Analysts believe this project would cost between 10 to 12 billion dollars.
This project was designed mainly due to pressure from U.S who opposes the Iran-Pakistan-India pipeline due to Iran’s alleged nuclear program. U.S is pressurizing Pakistan to shelve the IPI pipeline project with Iran. Sources confirm that US Department of State officials were taking part in the 22 August meeting and they had invited executives from Chevron who is willing to finance the project and they are seeking a stake in developing gas fields in Turkmenistan.
The four participating countries have decided to hire Asian Development Bank (ADB) as the transaction advisor. Initially ADB had demanded $100 million project fee plus an additional $50,000 monthly as retaining cost of the project. However, after intense negotiations between the TAPI committee and ADB the fee was reduced to half of the proposed fee, from $100million to $50 million.Asian Development Bankdemands the 4 countries to submit a token fee, which, initially, was declined by Afghanistan because it did not wantany gas. However, Kabul later changed the plan and decided to participate in project fully. After this development Afghanistan will receive 500 million cubic feet of gas per day while Pakistan and India would get 1.365 billion cubic feet of gas per day.
Pakistan’s decision to boycott is aimed to exert pressure on US and force them to intervene and stop India from violating the border agreement. However, Pakistan is facing massive deficit and they need 8 billion cubic feet of natural gas a day while they are hardly catering to 50% of the demand. Moreover, time is of great essence and the project cost has already risen by 25% due to the delays caused earlier.