Pakistan Could Face $18bn Fine in a Delayed Iran-Pakistan Gas Pipeline on its Territory
Pakistan is looking for a workaround to avoid a problem with the U.S. and billions of dollars in fines for the delayed Iran-Pakistan gas pipeline project.
According to an article published by Press TV on March 4, sources privy to the matter revealed Pakistani lawmakers had demanded progress on the project, warning of penalties if it is not completed by the year-end.
Officials in the petroleum ministry said Islamabad would have to pay $18 billion in fines if it terminates the Iran-Pakistan gas pipeline agreement. However, a ban on importing gas from Iran has also made the completion of the pipeline difficult, prompting Pakistani officials to reach out to the United States to request a waiver.
Parliamentarians have urged the Ministry of Foreign Affairs to summon the American envoy and demand permission to proceed with the project or provide funding to cover the fine.
The U.S has been pressuring Pakistan to abandon the plan to import gas from Iran, but the Pakistani government has so far resisted, citing the project's significance in meeting the country's energy needs.
Experts believe the pending gas pipeline project with Iran could be a viable solution to Pakistan's energy crisis.
However, it is contingent on the country's ability to step out of U.S. influence. Iran has already completed a portion of the pipeline in its territory, and it should connect to the Pakistani part at the border.
The push for the Pakistani government to speed up the project completion comes as the country grapples with multiple crises, and avoiding the $18 billion penalty could help Pakistan avert another crisis.
In January 2023, Iran officials informed the visiting Pakistan delegation that the U.S. sanctions were illegal and Tehran would fine Islamabad if it failed to complete its portion of the pipeline as earlier agreed.
The Iran-Pakistan gas pipeline project has been under discussion for several years, and both countries have agreed to complete it despite external pressures. The pipeline's completion is crucial for Pakistan to address its energy shortages and ensure its energy security.