India offers Pak oil pipeline
In a major peace initiative, India on Wednesday proposed to build pipelines to Pakistan if it provides long-term guarantees on buying petroleum products. India now has excess refining capacity and is exporting petrol and diesel, among other petroleum products, to various parts of the world, including Europe.
“We proposed exporting petroleum products and petrol to Pakistan. They have shown interest. We will work out the details in the next few weeks,” petroleum minister S. Jaipal Reddy said after meeting Pakistan’s oil minister Asim Hussain.
He said India was exporting petroleum products to distant countries, while Pakistan was importing them. Mr Reddy said the Pakistani minister “has kindly agreed to have this proposal considered within the ministry and the government there before responding”.
Dr Hussain said groups from both countries will meet soon to sort out the issue.
India has offered to export petrol, diesel, aviation turbine fuel (ATF), polyethylene and polypro-pylene, which Pakistan currently imports.
It was pointed out to Pakistan that it would save a lot in transport costs as several Indian refineries are close to the Pakistan border.
A India-Pakistan joint working group on petroleum and petrochemical products has been constituted recently to go into the specific details of facilitating trade in this sector. Both ministers agreed to advise their respective officials to hold the first meeting of the JWG at the earliest.
India currently has the refining capacity to process 193 million tonnes of crude oil annually, which is expected to rise to 232 million tonnes by 2012. India exports 59 million tonnes of petroleum products worth $43 billion annually.
Pakistan bans the import of petrol from India.
Pakistan had allowed diesel imports from India in 2009, but no Indian supplies were sent in the face of preferential prices offered by Pakistan’s Gulf allies.
On transit fees for the Turkmenistan, Pakistan, Afghanistan and India (Tapi) gas pipeline, both sides agreed that negotiations would be held in a transparent manner, keeping in mind the overall economics of the project and in accordance with international practices.
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