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Let Myanmar pipeline be standalone project: India tells Bangladesh

Anupama Airy
From The Financial Express, India
August 1, 2005
link to this article.

India is not averse to any of the issues raised by Bangladeshi authorities according to Indian high commission officials in Dhaka. However, the only bone of contention is that while Dhaka feels that discussions on the these issues should form part of the trilateral dialogue, New Delhi is firm on its stand that negotiations on these issue should be de-linked from the pipeline project and be carried out on a bilateral basis.

India is of the view that the pipeline should be considered a stand-alone commercial project for which Bangladesh will be adequately compensated by the $100-125 million transit fee that it will get. Moreover, with this pipeline, Bangladesh would also be able to transfer gas supplies from the east to the western region of the country.

A gas pipeline from Myanmar via Bangladesh to India is certainly the most viable and cost-effective option of bringing gas from the offshore gas fields in Myanmar into the Indian territory. At the same time, another option of routing the pipeline via the north-eastern region, even though an expensive one, is also being explored.

A senior Indian high commission official in Dhaka told FE that while all efforts are being made to address the concerns raised by the Bangladeshi authorities on providing a trade and energy link to Nepal and Bhutan, the option of routing the pipeline via the north-east should be seriously explored, even if it amounts to taking the pipeline through a tough terrain and costs an estimated $2 billion extra.

"Bangladesh is asking for a variable transit fee which starts from $100 million and goes up to $500 million in the next 20 years. Even if Bangladesh agrees to charge a transit fee of $100-125 million, we will still spend a huge amount running into billion of dollars in the 20-year period. Why can't we then spend $2 billion extra in one go, considering the benefits it will bring along in terms of the development in North-East.

This pipeline can actually turn around the fate of the north-east which remains economically backward. The pipeline route via north-east actually offers us with a golden opportunity for the economic development of the region," the official said.

Officials said that while India has already issued a statement saying that it will explore an alternate route to transport gas from Myanmar, it is being understood as a mere "pressure tactics" by the authorities in Bangladesh. "They feel we are not serious on the alternate route via north-east. Why can’t we then seriously look into this option of a pipeline which will bring along with it the economic development in the north-eastern region," the official said.

On Bangladesh's keenness to mix trade issues with the pipeline project to improve the imbalance in bilateral trade, Indian officials in Dhaka clarified that already several moves were under way to resolve issues on this front.

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