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Iran to provide $500m loan to Pakistan for IP gas pipeline

Iran plans to invest $500 million to extend financial and technical assistance for laying the Pakistan section of the proposed gas pipeline between the two countries, according to a statement on Tuesday.

Iranian President Mahmoud Ahmadinejad is scheduled to visit Pakistan to sign the inter-governmental cooperation agreement (IGCA), according to which the Iranian government will provide a loan of $250 million to Pakistan and another $250 million will be arranged through Iranian commercial banks for engineering, procurement, and construction work on the Iran-Pakistan (IP) gas pipeline, IRNA news Agency reported.

According to a plan that has been proposed, Pakistani and Iranian companies would form a joint venture to lay the pipeline, it said.

Earlier, China and Russia had committed to financing the pipeline if they were awarded construction contracts without bidding.

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