On April 22, Iranian President Ebrahim Raisi, is scheduled for a state visit to Pakistan. Their number one topic probably won't be Hamas or the Houthis, but rather a pipeline.
The Iran-Pakistan natural gas pipeline was conceived in 1950, and in 2010 — despite U.S. opposition — the countries concluded a 25-year Gas Sale and Purchase Agreement, and construction of the 2,775 km pipeline from Asaluyeh, Iran, to Multan, Pakistan. The initial cost estimate was $7.5 billion.
Pakistan suffers persistent power shortages, causing 18-hour blackouts in rural areas and 6- to 10-hour load-shedding in cities. Although Pakistan has made investments in power generation and distribution, in January 2023 the country suffered a breakdown in the national grid. Another blackout happened in October 2022.
According to the World Bank, an unreliable supply of electricity is “a significant barrier to economic growth.” One recent study found that business profitability in developing countries may be reduced up to almost 40 percent by power crises, and the U.S. Institute of Peace reports of Pakistan, “the shortages impose large costs on the economy as a whole — estimated at about 2 percent of gross domestic product annually — through lower output, exports, and employment.”
In August 2023, Pakistan announced it was suspending the project under threat of U.S. sanctions. Iran rejected Pakistan’s attempts to get out of its agreement, but granted a 10-year extension, and both sides got to work on a way forward. The Iran-Pakistan natural gas........