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. Last Updated: 07/27/2016

India Eyes New Turkmen, Iranian Gas Link

NEW DELHI, India -- The Indian Cabinet authorized the oil ministry on Wednesday to negotiate with Iran, Myanmar, Pakistan, Bangladesh and Turkmenistan for building pipelines to import natural gas, a government statement said Wednesday.

India produces only half the natural gas it uses and analysts say large transnational pipelines will be viable in the region only if gas reaches its vast market.

The government said natural gas imports were necessary to sustain the expected 7 percent to 8 percent annual economic growth.

"It is imperative to look for cost-effective and long-term arrangements to meet our energy requirements. Natural gas is the most economic, efficient and environment-friendly fuel," it said.

Oil ministry officials said the Cabinet's decision would enable the oil ministry to directly negotiate pipeline deals instead of depending entirely on the foreign ministry.

India recently signed an agreement to import natural gas from Myanmar via Bangladesh and said a panel would be set up to work out the details such as the route of the pipeline and the price of the gas. It is also in talks with Iran to build a pipeline across Pakistani territory.

"Implementation of these proposals would reduce the large deficit between the demand and supply of natural gas and would increase energy security in terms of availability as well as affordability," the statement said.

The $4 billion gas pipeline from Iran via Pakistan had been proposed for meeting India's growing energy needs.

Pakistan, which stands to earn millions of dollars in transit fees, has been keen on the project for years, but plans have made little headway because of political tensions with India.

India started importing liquefied natural gas from Qatar last year and recently signed a contract to import 7.5 million tons per year from Iran starting 2009.