The Georgetown Journal’s Guide to The Iran-Pakistan-India "Peace Pipeline" by Sumitha Kutty

The hunt for energy resources in the South Asian neighborhood has been a decades-long, tension-fraught process. Mitigating the energy crisis remains one of the foremost goals of the two greatest powers in the region, rivals India and Pakistan. And the most accessible solution to their problem lies right across the Hindu Kush in a controversial nation with historic ties to both—Iran. The history of the Iran-Pakistan-India Pipeline (IPI) offers a revealing exploration of the shifting dynamics and troubled nature of geopolitics in South Asia. The idea of a natural gas pipeline between India and Iran was proposed by the former in 1993. Since relations with Pakistan were much worse then, India proposed an underwater pipeline directly from Iran. The proposal was considered economically infeasible and rejected.  In early 2000, Pakistan was included after it agreed to allow Iranian gas cross its territory. Dubbed the “Peace Pipeline,” the 2,700-kilometer pipeline could transport 2.8 billion cubic feet of gas daily from Iran’s South Pars natural gas fields to India across Pakistan. As expected, the United States strongly opposed the IPI.

Despite American pressure, India and Iran inked preliminary agreements in 2005. But wrangling continued over pricing, customs tariffs and transit fees. India and Pakistan disagreed with Iran’s pricing policy even as India remained distrustful of Pakistan. New Delhi demanded that Iran guarantee Pakistan would actually deliver the gas to its borders. By 2006, with India signing a civilian nuclear energy agreement with the United States, Washington’s long-standing opposition to the pipeline reached the subcontinent. The US presented an alternative to India and Pakistan - the Turkmenistan-Afghanistan-Pakistan-India (TAPI) pipeline.

Reduced enthusiasm now emerged from New Delhi’s end even as the increasing American influence in South Asia left Tehran wary.  India’s vote against Iran at the IAEA in 2006 momentarily froze bilateral relations between both nations. The Indians boycotted a number of talks from 2008. The Mumbai terror attacks also resulted in a new low in Indo-Pakistani relations. With no conclusive decision from New Delhi, Teheran and Islamabad went ahead with the agreement in 2009. The signing of the Iran-Pakistan phase of the pipeline triggered reports that New Delhi had finally buckled under US pressure and walked out of the deal. Interestingly, China now expressed interest in the expansion of the pipeline. The Indians, however, have never officially abandoned the IPI pipeline.

In May 2010, New Delhi approached Tehran to resume talks but reiterated their issues with Pakistan; demanding safeguards within the contract to ensure the gas reached India. The following year, Iran’s nuclear activities triggered a fresh round of sanctions but India and Pakistan have showed no signs of backing down. The IPI pipeline caught international attention in February this year after Iranian President Mahmoud Ahmedinejad and Pakistani President Asif Ali Zardari reiterated their commitment to completing the Iran-Pakistan phase of the pipeline project by 2014. This announcement prompted Secretary Clinton to threaten sanctions, which were met with Pakistan’s dismissive reply and Iran celebration of the union of interests between ‘brotherly’ nations.

Currently, the Iranian stretch of the pipeline is near completion but the Pakistanis have reached an economic roadblock. Iran has even offered to help finance the Pakistanis, revealing just how much this project’s accomplishment means to the cornered Islamic Republic. As for India, the US-blessed TAPI pipeline has turned out to be less viable than the IPI one. With both Afghanistan and Pakistan in turmoil, the TAPI route has become unfeasible just as greater interaction with Iran has become taboo.

Ultimately, South Asia’s energy crisis continues to be entangled in a tale of two pipelines; far from "peaceful" and no end in sight.

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Sumitha Narayanan Kutty is an editorial assistant for the online section of the Georgetown Journal and a student in the MA in Security Studies Program at Georgetown University.