ISLAMABAD: Pakistan has hired a French law firm to explore legal options to deal with Iranian threat of moving international court against Islamabad for its failure to execute the Iran-Pakistan gas pipeline project and find out a way if the project can be completed without attracting the US sanctions, a top official at Ministry of Energy said on Tuesday.
The US has steadfastly opposed Pakistan's involvement in the $7 billion project, saying it violates the sanctions imposed on Iran.
Under an agreement signed between the two countries in 2009, the project was to be completed by December 2014 and would deliver 21.5 million cubic meters (760,000 million cubic feet) of gas per day to Pakistan. It was to be constructed using a segmented approach – Iran had to lay down the pipeline on its side and Pakistan was supposed to build the pipeline on its soil.
Tehran formally issued a notice to Islamabad in February this year, saying it was moving an arbitration court against Pakistan for failing to lay down the pipeline in Pakistani territory in the time-frame stipulated in the bilateral agreement. Since then, Pakistan has been exploring different legal and diplomatic options to avoid litigation.
“We are analyzing the overall international situation regarding Iran and studying Tehran’s position over the gas pipeline project through an international law firm,” Sher Afgan Khan, additional secretary at Ministry of Energy, told Arab News.
Pakistan has hired the French law firm, Gide Loyrette Nouel, to study the deal and prepare a legal response to Iran’s position that the US sanctions do not impact its gas import trade. In May this year, Pakistan had informed Iran in writing that it cannot execute the project as long as Tehran is under a US sanctions regime.
“We are trying our best not to violate [the US] sanctions ….. we are already on the FATF’s [Financial Action Task Force] grey-list,” Khan said referring to Pakistan’s formal placement on the FATF’s grey-list in June last year.
The Trump administration has warned countries around the world to stop buying Iranian oil or face sanctions of their own. Washington’s European allies have tried and failed to come up with ways to blunt the economic impact of the US move. The US sanctions against Iran are a major hindrance for most gas pipeline projects in the region.
But Pakistan is caught in a catch-22 situation over the deal. Under a penalty clause, Pakistan is bound to pay $1 million per day to Iran from January 1, 2015 for failing to build its part of the pipeline. If Iran takes the case to an arbitration court, Pakistan will likely have to pay around $1.8 billion in penalty.
Additional secretary Khan said, “Negotiations are in progress to settle the issue amicably” with Iran, adding that "Iran understands our position."
About the deadline of completion of the legal consultation process with the French law firm, he said: “It is not very extensive and expected to be completed soon.”
Pakistan hires top law firm to avoid $1.8 billion penalty in Iran gas pipeline project
Pakistan hires top law firm to avoid $1.8 billion penalty in Iran gas pipeline project
- French law firm Gide Loyrette Nouel will provide legal assistance to Islamabad
- Pakistan is bound to pay a daily penalty of $1 million to Iran starting from January 1, 2015 under a penalty clause of the bilateral agreement
Pakistan nears $1.5 billion deal to supply weapons, jets to Sudan
- Deal may include drones, air defense systems and Karakoram-8 aircraft, with possible JF-17 fighters
- The sale is expected to bolster Sudan’s army in the ongoing civil war with the Rapid Support Forces
ISLAMABAD: Pakistan is in the final phases of striking a $1.5-billion deal to supply weapons and jets to Sudan, a former top air force official and three sources said, promising a major boost for Sudan’s army, battling the paramilitary Rapid Support Forces.
Their conflict has stoked the world’s worst humanitarian crisis for more than 2-1/2 years, drawing in myriad foreign interests, and threatening to fragment the strategic Red Sea country, a major gold producer.
The deal with Pakistan encompasses 10 Karakoram-8 light attack aircraft, more than 200 drones for scouting and kamikaze attacks, and advanced air defense systems, said two of the three sources with knowledge of the matter, who all sought anonymity.
It was a “done deal,” said Aamir Masood, a retired Pakistani air marshal who continues to be briefed on air force matters.
Besides the Karakoram-8 jets, it includes Super Mushshak training aircraft, and perhaps some coveted JF-17 fighters developed jointly with China and produced in Pakistan, he added, without giving figures or a delivery schedule.
Pakistan’s military and its defense ministry did not immediately respond to requests for comment.
A spokesman for Sudan’s army did not immediately respond to a message requesting comment.
Assistance from Pakistan, especially drones and jets, could help Sudan’s army regain the air supremacy it had toward the start of its war with the RSF, which has increasingly used drones to gain territory, eroding the army’s position.
PAKISTAN’S DEFENSE AMBITIONS
The deal is another feather in the cap for Pakistan’s growing defense sector, which has drawn growing interest and investment, particularly since its jets were deployed in a conflict with India last year.
Last month, Islamabad struck a weapons deal worth more than $4 billion with the Libyan National Army, officials said, for one of the South Asian nation’s largest arms sales, which includes JF-17 fighter jets and training aircraft.
Pakistan has also held talks with Bangladesh on a defense deal that could includes the Super Mushshak training jets and JF-17s, as ties improve ties with Dhaka.
The government sees Pakistan’s burgeoning industry as a catalyst to secure long-term economic stability.
Pakistan is now in a $7-billion IMF program, following a short-term deal to avert a sovereign default in 2023. It won IMF support after Saudi Arabia and other Gulf allies provided financial and deposit rollovers.
