Iran-India strategic cooperation opens new horizons: Kharrazi

"Fortunately, the Indian government's recent approval of the gas pipeline has created an encouraging atmosphere for pushing ahead this highly important project, which no doubt would have a positive impact on regional convergence," Kharrazi told reporters.

Last week, India's cabinet approved proposals to hold separate talks with Iran, Myanmar, and Turkmenistan on the construction of gas pipelines.

"Laying the Iran-Pakistan-India gas pipeline would be the best and most desirable step towards enhancing cooperation between Iran and India in the field of energy," Kharrazi told a gathering of industrialists and decision-makers in the India-Iran Joint Business Council Meeting at the Federation of Indian Chambers of Commerce.

The Iranian foreign minister said, "The signing of a document in January 2005 on Iran selling 7.5 million tons of LNG a year to India for 25 years and India's participation in developing Iranian oil fields and extracting some 100,000 barrels of oil per day from them was one of the most significant results of the strategic agreements reached by the two countries so far.

"The Iran-Pakistan-India pipeline would be the best and most desirable step towards enhancing the cooperation between Iran and India in the field of energy. The lower cost of the piped gas, the creation of new job opportunities, and the acceleration of economic progress and foreign investment in the countries of the region are some of the main motivations for implementing such a large project."

Kharrazi observed that Iran and India have had relations for centuries and, in addition to historical and cultural affinities, businessmen have played a major role in relations between the two states.

In recent years the two countries have signed important agreements, and during President Mohammad Khatami’s visit to India in February 2002 new avenues were opened for bilateral and regional cooperation, Iran’s top diplomat noted.

In a world where regional cooperation and economic blocs play important roles in reviving economies, the establishment of an economic bloc in South Asia which could act as a link between the Southeast Asian economic bloc and those of the Persian Gulf region and Europe is a necessity, he added.

The strategic cooperation between India and Iran has opened new horizons for such regional cooperation and the new developments in the world economy, with increased participation of the most important producers and consumers of energy in Asia, highlights the need for such cooperation, he said.

The establishment of a common market comprising India, Pakistan, Afghanistan, Iran, Turkey, the Central Asian states, and the Caucasus would promote economic growth and peace in the region, the Iranian foreign minister suggested.

These countries have the potential to become a giant economic bloc, he added.

Kharrazi said that the conclusion of an agreement between Russia, India, and Iran on the construction of the International North-South Transport Corridor is a prime example of close regional cooperation.

And the creation of the East Corridor connecting Uzbekistan, Iran, and Afghanistan is an indication of cooperation between New Delhi and Tehran, he stated.

These measures have opened new horizons "for regional cooperation between the two nations," he added.

Kharrazi insisted that the current level of cooperation between the two countries could be increased by the conclusion of agreements on preferential trade tariffs, the elimination of double taxation, the protection and promotion of investments, and the establishment of Iranian banks in India.

The Iranian foreign minister also noted that the current "non-oil trade balance between India and Iran is significantly in favor of India".

He stated that both countries have taken steps to boost bilateral trade relations, with Iran removing the ban on the import of Indian tea and creating new opportunities for Indian tea exporters and India relaxing constraints on the import of merchandise from Iran.

Kharrazi said that the enthusiasm of a number of multinational corporations to invest in Iran is a sign of positive economic development in the country.

He insisted that the current ties between the two countries should be expanded into new areas like IT, biotechnology, and tourism.

He noted that their proximity, the direct flights between the two states, and the large number of tourist attractions in India and Iran provide ample opportunities for bilateral cooperation in the tourism sector.

Direct flights between Hyderabad and Mashhad must be established to help raise the level of relations to new heights, he added.

India-Iran trade stood at $3 billion in 2004, a 30 percent rise from 2003. Both countries want to diversify trade exchanges beyond the energy sector.

Indian officials said the country's second-largest steel maker, Tata Iron and Steel Co. Ltd., and Essar Steel plan to set up steel plants in Iran, each costing hundreds of millions of dollars.

MS/HG

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MNA