To ensure that the Turkmenistan-Afghanistan-Pakistan-India (TAPI) Gas Pipeline Project does not remain a pipedream, India and Pakistan have decided to work on a joint strategy to resolve the contentious issue of transit fees.
At a bilateral meeting here on Wednesday, Pakistan agreed in-principle that whatever fee formula is eventually settled between India and Afghanistan, would also be acceptable to Pakistan subject to the approval of their competent authority. In other words, there could be a uniform transit fee applicable between Afghanistan-Pakistan-India.
This was the third meeting with Pakistan on the issue of transit fee but the first one at the political level. The transit fee payable to Pakistan by India for the 38 mmscmd of gas envisaged to flow through the pipeline project will have an implication on the landed cost of gas at India's border.
Addressing newspersons after the bilateral talks, the Petroleum Minister, Mr S. Jaipal Reddy said, on the transit fee, both sides agreed that the negotiations would be conducted in a transparent manner, keeping in mind the overall economics of the project — the landed cost of gas and in accordance with the relevant international practices.
Since there is a need to expedite the signing of the gas sale purchase agreement (GSPA), both sides agreed to settle the transit fee issue at the earliest, he said.
Pakistan's Federal Minister for Petroleum & Natural Resources, Dr Asim Hussain, and Mr Reddy said both countries were also working on a joint strategy for exploring upstream opportunities in Turkmenistan.
On the issue of pipeline security, Mr Reddy said when one agrees on a project such as this, a number of economic issues generate their own positive dynamics. The nations were dealing with the pipeline security issue.
Asked about the other mega pipeline project — Iran-Pakistan-India (IPI) — Mr Reddy, while stating that neither was mandated to talk on other issues, said: “We do what is more easily, more immediately possible.”
Both sides also noted that an India-Pakistan Joint Working Group (JWG) on petroleum & petrochemical products has been constituted recently to go into the specific details of facilitating trade in this sector, including infrastructure upgradation and augmentation in respect of the Railways, customs facilitation, setting up of banking channels, etc.