India: Where the US's Iran fixation is out of place

Apr 19, 2005 02:00 AM

by George Perkovich and Revati Prasad

India's foreign minister visited Washington and met with President George W. Bush, Secretary of State Condoleezza Rice and other top officials to discuss a range of mutual interests, from countering China's strategic clout to promoting economic growth and resolving tensions between India and Pakistan. Unfortunately, the Bush administration's obsession with Iran threatens to block a major initiative that could advance many of those goals.
India and Pakistan are trying to overcome decades of mistrust by cooperating on a pipeline that would bring natural gas from Iran through Pakistan to India. It is the sort of economically necessary, environmentally friendly and security-enhancing initiative that the United States has long advocated. Yet the Bush administration and Congress are so fixated on pressuring Iran that they would threaten sanctions against any foreign entity that participates in this win-win project between two bitter antagonists.

The pipeline would originate in Iran's South Pars gas field and traverse southwest Pakistan to the Indian border, where India would then construct a line to bring the gas to energy-starved western India. The $ 4 bn pipeline would be the most economical way to get natural gas from the Gulf to India. No American financing is needed to make it happen.
India is desperate for new sources of energy; its strong economic growth will stall without it. Pakistan would probably reap $ 600 mm to $ 700 mm annually in transit fees from the pipeline, which would also bring jobs to the restive regions of Baluchistan and Sind. For its part, Iran has agreed to provide $ 200 mm for development in Pakistan and to establish a Pakistan-Iran investment company to improve bilateral investment.

Beyond the obvious economic benefits, the pipeline would reduce the risk of conflict between India and Pakistan. As Prime Minister Shaukat Aziz of Pakistan, a former Citigroup executive, explained, "If we do this pipeline and it does take off, I sincerely believe India-Pakistan relations will move forward in the right direction." Indian officials, while concerned that Pakistani governments will not always keep the gas flowing, judge the economic and strategic gains to be worth the risk.
The pipeline would also have environmental benefits. Natural gas is the cleanest fossil fuel, and a steady supply of it to India would help slow carbon emissions that would otherwise contribute to global warming.

The Bush administration objects because it believes that economic pain can compel Iran to abandon its efforts to acquire nuclear weapons and will, ultimately, drive the cleric-led government from power. But 26 years of sanctions and pressure have achieved neither objective; indeed, they may have convinced many Iranians that only nuclear technology can protect their country against American hostility.
Democrats and Republicans alike, especially in Congress, have consistently misdiagnosed Iran's political dynamics. Nationalism has largely supplanted revolutionary religious fervour in Iran, and American pressure only feeds it. Iranians from across the political spectrum are convinced that the United States aims to keep their nation down, as payback for the 1979 revolution. Blocking the pipeline would continue that counterproductive trend.

Moreover, Washington can't have it both ways. We can't argue that Iran does not need nuclear energy because it has the world's second largest reserves of natural gas and then block Iran's investments in its gas industry. To wean Iran from its nuclear program, including its pursuit of uranium enrichment facilities that could be used to produce weapons, Washington must convince Iranians that the United States supports their peaceful economic development.
The Bush administration threatens to compound the negative impact of its opposition to the pipeline by supplying India with new nuclear reactors as an alternative -- a proposal that would go against existing domestic laws and international nuclear non-proliferation guidelines. Such a unilateral and mercantile move would incense Canada, Germany, Japan and other countries that the United States has pressured not to sell nuclear technology to countries like India that don't accept international safeguards.
In effect, the administration would be trying to block Iran's nuclear ambitions by rewarding India's, thereby undermining the global support needed for tougher non-proliferation rules both now and in the future.

The wisest solution is the simplest one here. All the United States has to do is stay out of the way and let market forces and regional security interests take over.
A pipeline that is good for India, Pakistan and also Iran will be good for America.

George Perkovich is the vice president for studies at the Carnegie Endowment for International Peace. Revati Prasad is a junior fellow there.

Source: International Herald Tribune
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