The Pakistani and Iranian presidents have inaugurated a joint pipeline project despite threats of sanctions. The Iranian gas will help its neighbor meet its energy needs as blackouts become increasingly frequent.
The idea to supply Pakistan with natural gas from Iran is not new. The two countries started developing a joint project in 1994, signing a preliminary agreement one year later.
In 1999, India also signed a similar agreement with Iran but abandoned the project 10 years later citing high costs and security matters.
The US government has repeatedly criticized the joint project, putting Islamabad under pressure to abandon it because of Iran's nuclear program.
"We have serious concerns if this project actually goes forward that the Iran Sanctions Act would be triggered," Victoria Nuland, spokeswoman of the US State Department, said on Monday.
"All of that said, we've heard this pipeline announced about 10 or 15 times before in the past. So we have to see what actually happens."
However, Pakistani security expert Ikram Sehgal thinks the US threat is not very convincing. "Energy shortages are crushing our economy. Industries and services have had to be closed down. There are more and more unemployed people and inflation is rising."
His argument is that the US government knows there will be a massive crisis if the Pakistani economy collapses. "That's why I think this project will be continued."
Christian Wagner from the German Institute for International and Security Affairs also thinks that the threat is somewhat toothless, considering the fact that Pakistan is practically bankrupt.
He says it is not in the US' interest to allow Pakistan to fall further into chaos; however, he does think that Washington will react with symbolic sanctions if the project moves forward.
Qamar Zaman Kaira, Pakistan's information minister, is nonplussed. "We will persuade the US not to use sanctions," he said, adding that Pakistan's national needs had to take priority.
Energy crisis needs tackling
Wagner agrees that the pipeline project is very important for tackling the country's energy crisis. Electricity and gas shortages are almost daily occurrences and there are frequent anti-government protests.
He also adds that the project is a sign of rapprochement to Iran, which, in light of recent attacks on Pakistan's minority Shia community, should not be underestimated.
Some critics say that President Asif Ali Zardari and his ruling Pakistan People's Party are acting out of sheer opportunism, days before the government's term is set to expire.
"If it were about the interests of the country, the decisions would have been made five years ago," said former Foreign Secretary Shamshad Ahmad Khan. "The energy and electricity shortages have lasted five years already and are getting increasingly worse." He added that the government had not taken much interest in the suffering of the population until now.
The planned pipeline is expected to stretch over 2,000 kilometers, of which 1,220 will run through Iran. Tehran has already built some 900 kilometers from the South Pars gas field.
Observers doubt the project will be finished by the end of 2014 as it is unclear how Pakistan will raise the 1.5 billion US dollars needed, although Iran has agreed to lend 500 million dollars.
Qamar Zaman Kaira is adamant to push ahead, however, arguing that a project that has been under discussion for decades will not fail simply because of a "comparatively small" lack of funding.