Business Standard: Indo-Pak gas deal is more than hot air

Against pessimism that had set in following the cancellation of the talks between the Foreign Secretaries of India and Pakistan to resume the stalled dialogue on normalising India-Pakistan trade, the recently concluded agreement on the gas-pricing formula for export of natural gas from India to Pakistan has given a much-needed fillip to trade relations between the two countries. The agreement comes as a breakthrough in the two-year long negotiation between the two state-run gas utilities, India's Gas Authority of India Ltd (GAIL) and Pakistan's Inter State Gas Systems (ISGS).

The proposal was for GAIL to supply five million metric standard cubic metres a day (mmscmd) of lean gas to Pakistan for five years. GAIL will source liquefied natural gas (LNG) from international suppliers (largely West Asia), which will then be re-gasified at the LNG terminal at Dahej in Gujarat, for supply to Pakistan. GAIL will lay a 110-km pipeline from Jalandhar to the Amritsar-Attari border, while Pakistan will build another 30 km of pipelines. MORE