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Execution of gas pipeline project not possible under US sanctions, Pakistan tells Iran

10:55 AM | 11 May, 2019
Execution of gas pipeline project not possible under US sanctions, Pakistan tells Iran
ISLAMABAD - Pakistan has suspended gas pipeline project with Iran and informed the neighbouring state in writing that execution of the project was not possible as long as Tehran is under United States (US) sanctions regime, Geo News reports on Saturday.

According to Inter-State Gas Managing Director Mobin Saulat “Under present US sanctions on Iran, it is impossible to execute the Iran-Pakistan gas pipeline project and we have conveyed it to Iran in writing recently.”

Earlier in February, both the neighbouring countries started a new round of negotiations after Tehran formally issued a notice to Islamabad stating that it was moving an arbitration court against Pakistan for failing to lay down the pipeline in Pakistani territory in the timeframe as stipulated in the bilateral agreement.

Sault said that Pakistan was still committed to executing the project only if international sanctions on Iran were lifted. He said that Pakistan cannot risk US sanctions by continuing with the project as Pakistan will risk US sanctions while working with Iran on the project.

Regarding Iran’s legal notice, Saulat informed that Pakistan has time till August 2019 to respond legally, adding to this he hoped that the issue will be settled through negotiations.

On the other hand, authorities in Iran were of the view that US sanctions did not apply to the IP gas project, to which Pakistan had sent Tehran a questionnaire to ascertain exactly how that was the case.

According to the Paksitan-Iran gas pipeline project, signed in 2009, the project was to be completed by December 2014 and would deliver 21.5 million cubic meters of gas per day to Pakistan. It was decided that the pipeline was to be constructed using a segmented approach, with Iran having to lay down the pipeline on its side and Pakistan to build the pipeline on its territory.

Under a penalty clause of Gas Sales Purchase Agreement, 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 is likely to have to pay billions of dollars as a penalty.

Earlier this week, US President Donald Trump imposed new sanctions targeting Iran’s revenue from the export of industrial metals and threatened further action unless Tehran fundamentally changed its behaviour, which has escalated tensions between the two states.

Daily Pakistan Global Web Desk

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PKR exchange rate to US dollar, Euro, Pound, Dirham, and Riyal - 21 Feb 2024

Pakistani currency remains stable against US dollar and other currencies in the open market on February 21, 2024 (Wednesday).

US Dollar rate in Pakistan

In the open market, the US dollar was being quoted at 279.6 for buying and 282.4 for selling.

Euro comes down to 300 for buying and 303 for selling while British Pound rate stands at 350.5 for buying, and 354 for selling.

UAE Dirham AED hovers at 76.15 whereas the Saudi Riyal saw slight increase, with new rates at 74.35.

Today’s currency exchange rates in Pakistan - 21 Feb 2024

Source: Forex Association of Pakistan. (last update 09:00 AM)
Currency Symbol Buying Selling
US Dollar USD 279.6 282.4
Euro EUR 300 303
UK Pound Sterling GBP 350.5 354
U.A.E Dirham AED 76.15 76.9
Saudi Riyal SAR 74.35 75.1
Australian Dollar AUD 181 183
Bahrain Dinar BHD 743.32 751.32
Canadian Dollar CAD 207 209
China Yuan CNY 38.89 39.29
Danish Krone DKK 40.38 40.78
Hong Kong Dollar HKD 35.74 36.09
Indian Rupee INR 3.37 3.48
Japanese Yen JPY 2.10 2.18
Kuwaiti Dinar KWD 902.41 911.41
Malaysian Ringgit MYR 58.6 59.2
New Zealand Dollar NZD 171.68 173.68
Norwegians Krone NOK 26.43 26.73
Omani Riyal OMR 725.96 733.96
Qatari Riyal QAR 76.76 77.46
Singapore Dollar SGD 207 209
Swedish Korona SEK 26.53 26.83
Swiss Franc CHF 316.9 319.4
Thai Bhat THB 7.93 8.08

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