China expresses interest in IP project

China has expressed to join the Iran-Pakistan gas pipleline project as a potential customer replacing original partner India. During his last visit to China PM Nawaz Sharif discussed creation of trade corridor which was later approved by the cabinet. On August 26th a Chinese delegation is arriving in Pakistan to sign a formal Memorandum of Understanding (MoU).

Sources revealed a gas pipeline from Gwadar to China may become part of the proposed MoU. Iran has expressed willingness to build Gwadar to Western China portion of the pipeline. Iran is also offering a 500 million dollars credit facility to Pakistan for her portion of the pipeline. The total cost of Pakistan side of pipeline is estimated at 1.5 billion dollars. Pakistan is requesting Iran to extend the credit facility as it can not raise capital from international markets because of US sanctions.

Inclusion of China in the project could become a landmark event in creating a new order of South Asia as a major power will openly become a major stakeholder in the region.

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