KARACHI: Pakistan decided to build an 80-kilometer segment of the Iran-Pakistan (IP) gas pipeline on Friday after the Cabinet Committee on Energy approved the recommendations of a ministerial oversight committee evaluating various dimensions of the project after it was constituted by Caretaker Prime Minister Anwaar-ul-Haq Kakar last September.
Originally intended to supply gas from Iran to both Pakistan and neighboring India, the project was referred to as the IPI pipeline. However, India later withdrew from the project over concerns related to pricing and security, leading to the current designation as the IP gas pipeline.
The project remained stalled for a significantly long period since it could potentially create problems for Pakistan due to the international sanctions targeting Iran.
The United States, in particular, expressed opposition to the project, and there had been concerns that Pakistan could face economic sanctions if it proceeded with it.
“The [Cabinet] Committee [on Energy] recommended to start work on the 80 km segment of the pipeline inside Pakistan i.e. from Pakistan border up till Gwadar in the first phase,” said an official statement circulated by the Petroleum Division of Energy Ministry. “The Project will be executed by Inter State Gas Systems (Pvt) Ltd. and will be funded through Gas Infrastructure Development Cess.”
“All the concerned divisions gave a positive nod to move ahead with the project to ensure gas supplies to the people of Pakistan, thereby addressing the increasing energy needs of the country,” the statement added.
The project is expected to boost the country’s energy security and strengthen the local industry that can be assured sustainable and enhanced gas supplies.
The construction of the IP pipeline is also expected to catalyze the economic activity in Pakistan’s southwestern Balochistan province and which can positively impact the national economy.
Government greenlights construction of 80-kilometer segment of Iran-Pakistan gas pipeline
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Government greenlights construction of 80-kilometer segment of Iran-Pakistan gas pipeline
- The pipeline will be constructed from Pakistan’s border with Iran to its port city of Gwadar in the first phase
- The project is likely to boost the country’s energy security, strengthen local industry with enhanced gas supply
Pakistan PM orders accelerated privatization of power sector to tackle losses
- Tenders to be issued for privatization of three major electricity distribution firms, PMO says
- Sharif says Pakistan to develop battery energy storage through public-private partnerships
ISLAMABAD: Pakistan’s prime minister on Monday directed the government to speed up privatization of state-owned power companies and improve electricity infrastructure nationwide, as authorities try to address deep-rooted losses and inefficiencies in the energy sector that have weighed on the economy and public finances.
Pakistan’s electricity system has long struggled with financial distress caused by a combination of factors including theft of power, inefficient collection of bills, high costs of generating electricity and a large burden of unpaid obligations known as “circular debt.” In the first quarter of the current financial year, government-owned distribution companies recorded losses of about Rs171 billion ($611 million) due to poor bill recovery and operational inefficiencies, official documents show. Circular debt in the broader power sector stood at around Rs1.66 trillion ($5.9 billion) in mid-2025, a sharp decline from past peaks but still a major fiscal drain.
Efforts to contain these losses have been a focus of Pakistan’s economic reform program with the International Monetary Fund, which has urged structural changes in the energy sector as part of financing conditions. Previous government initiatives have included signing a $4.5 billion financing facility with local banks to ease power sector debt and reducing retail electricity tariffs to support economic recovery.
“Electricity sector privatization and market-based competition is the sustainable solution to the country’s energy problems,” Prime Minister Shehbaz Sharif said at a meeting reviewing the roadmap for power sector reforms, according to a statement from the prime minister’s office.
The meeting reviewed progress on privatization and infrastructure projects. Officials said tenders for modernizing one of Pakistan’s oldest operational hubs, Rohri Railway Station, will be issued soon and that the Ghazi Barotha to Faisalabad transmission line, designed to improve long-distance transmission of electricity, is in the initial approval stages. While not all power-sector decisions were detailed publicly, the government emphasized expanding private sector participation and completing priority projects to strengthen the electricity grid.
In another key development, the prime minister endorsed plans to begin work on a battery energy storage system with participation from private investors to help manage fluctuations in supply and demand, particularly as renewable energy sources such as solar and wind take a growing role in generation. Officials said the concept clearance for the storage system has been approved and feasibility studies are underway.
Government briefing documents also outlined steps toward shifting some electricity plants from imported coal to locally mined Thar coal, where a railway line expansion is underway to support transport of fuel, potentially lowering costs and import dependence in the long term.
State authorities also pledged to address safety by converting unmanned railway crossings to staffed ones and to strengthen food safety inspections at stations, underscoring broader infrastructure and service improvements connected to energy and transport priorities.
