India to set up gas line to Pakistan.

In his maiden Budget presented in the Lok Sabha, finance minister Arun Jaitley exempted liquefied natural gas (LNG) imports from customs duty if it is meant for onward sale to the neighbouring nation.

'Exemption from basic customs duty (of 5%) is being granted on re-gassified LNG for supply to Pakistan,' the Budget said.

This will set the stage for the state-run Gail India Ltd, which plans to build a '500-crore pipeline to export five million units per day of regassified-LNG to Pakistan, to start work on the ground.

'Its an important project that will help improve bilateral diplomatic and economic ties between the two neighbours,'Dharmendra Pradhan, minister of state for petroleum, told HT.

'Broad parameters have been agreed to and a contract will also be signed shortly between the two sides after which it will take one year to build it,' Gail CMD BC Tripathi told HT.

Interestingly, citing security concerns, New Delhi has put on hold a plan to be part of a '10,000-crore pipeline originating in Iran, passing through Pakistan and terminating in India to carry gas from Iran's South Pars gas fields. Security experts felt that being dependent on gas coming via Pakistan could compromise India’s energy security.

Hindustan Times