India in talks with Iran on gas field

In a sign of revival of ties with Iran, India concluded a major part of negotiations for a lucrative gas field days before Prime Minister Manmohan Singh met Iranian President Mahmoud Ahmadinejad in New York and accepted an invitation from him to visit Tehran.New Delhi was also compelled to move following a gentle warning from Iran that it was planning to reduce the stake of Indian companies in the Farzad-B gas field development project. Intensive negotiations over five days on Iran's Kish Island saw both sides negotiating the main part of the contract which had been left partly discussed when talks last broke off in November 2009, Indian government sources told The Hindu. Both sides will now hold the next round of talks in New Delhi in November when the more important issue of internal rate of return and security of investment will be discussed. The renewal of talks on energy projects could set the stage for purposeful discussions on the development of the Iranian port of Chabahar, the shortest route for sending supplies into the Pashtun-dominated Southern Afghanistan. A short distance away from the Gwadar port in Pakistan being built by the Chinese, Chabahar can be connected to the hinterland of Afghanistan as well as its major cities and even beyond to Central Asia. This could be facilitated by linking up Chabahar to the Iranian border town of Milak. An Indian-built road from the corresponding Afghan border town of Zaranj then leads to the Afghan garland highway. India had been pursuing the project for some time before it was stalled due to the US pressures on New Delhi. Oil and Natural Gas Corporation (ONGC) and Indian Oil hold 80 per cent stake in the block and Oil India the remaining 20 per cent. India went for talks after Iran said it was planning to shift the project to an Iranian consortium and offered only a 30 per cent stake to the ONGC. Informed sources expected the thaw to have some impact on the situation in Afghanistan. Both countries approve a regional solution with India taking up the gauntlet for the Shanghai Cooperation Organization (SCO) Plus countries. The SCO consists of four Central Asian countries, besides Russia and China. The SCO Plus includes India, Iran and Pakistan as Observers and Afghanistan as a Special Invitee. Sources said though these are early days, the Chabahar route could be a much better alternative for taking supplies into Afghanistan. The US and its allies are attempting to reduce dependence on the route through Pakistan but the alternative Northern Distribution Network with its funnel into Afghanistan at Uzbekistan is more expensive. One of the NDN route from Germany goes through as many as 10 countries before culminating in Uzbekistan. The US is also talking to China for a supply route from its Xinjiang province but this too goes across forbidding terrain.