Pakistan: The Sandwich Policy of Iran

Pakistan Times, Pakistan
July 12 2004

The Sandwich Policy of Iran
By Tariq Saeedi

FOR the last decade or so, Iran has been following a policy that
defies any rational justification. After the fever to export Islamic
revolution subsided in the early 1990¡¯s, Iran started a number of
maneuvers that can collectively be called The Sandwich Policy.

The Sandwich Policy is meant to maintain imperceptible but persistent
tension with the immediate neighbours and promote deep friendly
relations with the neighbours of neighbours. There may be some unseen
benefits behind this policy but what is quite obvious is that it
undercuts the economic interests of Iran¡¯s neighbours and
strengthens economic cooperation of Iran with the neighbours¡¯
neighbours.

It is not a novel concept. Some five thousand years ago a well-known
sage from the Indian subcontinent first advocated this policy as a
sound advice to the kings.

A case in point is the natural gas pipeline proposals for India. Two
parallel proposals ┬ĘC Trans-Afghan Pipeline (TAP) and
Iran-Pakistan-India (IPI) pipeline are under consideration to meet
the energy needs of India.

Even though President Khatemi, answering one of my questions during
his visit to Turkmenistan in 2002, said, ¡°Iran would welcome both
[TAP and IPI],¡± Iran acted otherwise.

When I posed a joint question to President Khatemi and President
Niyazov that is it practicable to lay both the pipelines, Khatemi
said, ¡°Iran supports any proposals that would help Turkmenistan tap
the full potential of its natural resources. Not only that, we shall
do all we can to help promote this project [TAP].¡±

The later developments showed that Khatemi was merely being polite.

Despite the fact that both the TAP and IPI would not be enough to
meet the fast growing requirements of expanding Indian economy, Iran
turned a number of loops to persuade India to go for IPI only.

This is obviously to India¡¯s disadvantage.

Iran would provide natural gas to India from its South Pars field in
the gulf. The gas from Pars has no more than 60% of Methane content,
the main ingredient of natural gas that gives heat energy and
consequently the only ingredient that matters to the consumers.

On the other hand, Turkmenistan¡¯s Daulatabat field, that is
available for TAP, offers 75-80% Methane content.

Price of the natural gas is determined in MMBTU ┬ĘC ability of the gas
to produce heat energy.

Gas with 60% Methane content would cost much less in the open market
compared to the gas with 75-80% Methane content. In other words,
Iranian gas should be priced at some 15-18% less than Turkmen gas.
However, according to the last reports, Iran is trying to convince
India to buy its gas at US $ 65/- per 1000 cubic meters. It is not
clear whether this price is at the border of Iran or elsewhere. If
this price is at the Iran-Pakistan border, India would be well
advised to give second thought to the deal because Turkmen gas, with
its far superior Methane content, can be made available at much less
price in terms of MMBTU.

Another factor to keep in mind is the transit costs. Transit of
natural gas on the level terrain comes to something like US $ 1/- per
100 kilometers per 1000 cubic meters. Transit cost for under-water
pipeline, as would be the case with IPI, is substantially more than
that because of maintenance charges and repair costs.
Field-to-kitchen distance for Pars gas would be more than Turkmen
gas, adding to the transit cost and ultimately putting additional
burden on the consumers.

In all honesty, India needs both the pipelines. At present the
demand-supply gap of natural gas in India is around 43 billion cubic
meters per annum. This would go up to 65 billion cubic meters
annually by 2008. Combined capacity of TAP and IPI would be 60
billion cubic meters, still leaving a gap of 5 billion cubic meters
between demand and supply projections for 2008.

Playing with Turkmenistan¡¯s interests is not the only example of
Iran¡¯s Sandwich Policy.

Recently, when President Saakashvilli visited Iran, he got a firm
promise that Iran would provide natural gas to Georgia. This was
despite the fact that at present there is no pipe connection to
transport Iranian gas to Georgia and Russia is the main supplier of
gas to Georgia, a supplier that has been pumping gas almost regularly
event though Georgia has been unable to clear the backlog of
payments.

The foghorn called Saakashvilli returned to Tbilisi and started
inciting ¡®every Georgian family¡¯ to rise against Russian presence
in some regions of Georgia. The immediate result, as of Sunday
evening, was that Russia has cut off the supplies of gas to Georgia,
plunging the whole country into economic chaos.

By making moves that are not rooted in reality, Iran managed to anger
Russia, its staunchest supporter in its nuclear programme, and put a
fledgling country ruled by a vapor-whistle into deep economic crisis.
One wonders if Iran realizes what it is doing.

There are many more examples of Iranian Sandwich Policy.

Azerbijan is the next-door neighbour of Iran and more Azeris are
living in Iran than in Azerbijan. Moreover, Azeris are Shias, the
same Islamic sect as the official religion of Iran. And yet, Iran
continues to antagonize Azerbijan and prefer to improve relations
with Armenia, a neighbour of Azerbijan that has annexed
Ngorno-Karabakh region by force and continues to harass Azerbijan
continuously.

Iran signed a transportation network agreement with Afghanistan,
Tajikistan and Uzbekistan last year that is meant to bypass
Turkmenistan for road trade route between Iran and Central Asia. This
is despite the fact that Turkmenistan has joined hands with Iran in
building a water dam-reservoir and continues to support Iran in
Caspian issues and other matters where Iran lacks substantial
international support.

At times it appears that economic planners of Iran are totally
unaware of obtaining political realities and they also seem unaware
of the fact that a US-led ¡®war against terrorism¡¯ is slowly rolling
in their direction. It is the classic case of split personality, two
governments in one country.

To weather successfully the times of war, it is necessary to maintain
good relations with neighbours in times of peace.¡ñ

The writer is Ashgabat, Turkmenistan-based journalist, noted analyst
and the Editor of a regional news agency, News Central Asia Inc.
(nCa) He is also a regular contributor to ‘Pakistan Times.’
E-Mail: [email protected]