Pakistan banking on Iran trade bonanza after Obama nuclear deal

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The lifting of economic sanctions on Iran will open “massive trade” opportunities for Pakistan and could effectively transform the energy markets of South Asia by paving the way for a long-awaited gas pipeline across the Iranian-Pakistani border, said a top Pakistani diplomat, expressing his nation’s deep hope that the Obama administration’s nuclear deal with Tehran goes into effect as soon as possible.

Syed Tariq Fatemi, special assistant to Pakistani Prime Minister Nawaz Sharif, said his country is “mindful” not to take action until the United Nations officially lifts sanctions, but he asserted that Islamabad is already in constant communication with Iranian authorities about the prospects for the stalled pipeline, as well as other avenues for growing commercial ties between the two nations, which share a 560-mile border.

In a wide-ranging chat with reporters Friday at the Pakistani Embassy in Washington, Mr. Fatemi said that after a decade of internal turmoil, Pakistan is on a path toward stability and democratic transformation. He said increased trade is essential to the goal of weaning the nation’s economy off of handouts from the U.S. and other international powers.

Pakistan’s hope is just one sign of the wide-ranging implications of the nuclear deal negotiated by the Obama administration and five international partners with Iran, which may quickly lead to an end to punishing economic and financial restrictions on the Iranian economy.

“An end to sanctions will open up new opportunities for Pakistan to enhance its commercial and economic ties with Iran,” Mr. Fatemi said. “We have a long border, and we could have massive trade with that country should this issue of sanctions no longer be hovering over us.”

The Iranian-Pakistani gas pipeline project, he said, could ease crippling power shortages that plague Pakistan, where blackouts combined with an intense heat wave killed more than 1,000 people during recent months.

Mr. Fatemi said the prospective pipeline would “not only benefit Pakistan in terms of providing us with a valuable source of energy, we also believe that such a pipeline could encourage cooperation amongst the countries of the region that would really strengthen peace and stability.”

“Iran’s coming out into the mainstream of international politics will [also] be a positive development,” said Mr. Fatemi, who played down the idea that closer ties between Islamabad and Tehran might anger Arab powers in the Middle East that have expressed discontent over the Iran nuclear deal.

He spoke after a week of meetings with senior Obama administration officials, State Department diplomats and several high-level members of Congress from both sides of the aisle.

Talking with the Taliban

Mr. Fatemi said that during every meeting — even with key Republicans such as Senate Armed Services Committee Chairman John McCain of Arizona — American officials gave him confidence that the U.S.-Pakistani relationship is as strong, if not stronger, than at any other time in recent history.

With the prospect of a full U.S. troop withdrawal from Afghanistan, Mr. Fatemi said, U.S. officials expressed support for the Pakistani government’s 13-month-old military campaign against Taliban and Haqqani network militants along the Afghan-Pakistani border.

He expressed confidence in Afghan President Mohammad Ashraf Ghani, asserting that political, intelligence and military officials in Islamabad have had more direct and positive interaction with the Ghani government during the past six months than current Pakistani leaders had in six years with President Hamid Karzai.

A central focus, he said, has been boosting peace talks between the Afghan government and the Taliban, the Islamist militant group with fighters in both countries.

“It is only through promoting reconciliation talks that peace can be assured in Afghanistan,” said Mr. Fatemi, highlighting the importance of a July 7 meeting in Pakistan between “prominent Taliban leaders along with prominent representatives of President Ashraf Ghani’s Cabinet.”

“More importantly, senior representatives of Pakistan, the United States and China were present in those talks as well,” he said. “We wish to make this a process rather than to keep it as an event.”

He stressed that any militant faction unwilling to come to the negotiating table will be targeted by Pakistani and Afghan security forces. “The two countries are cooperating closely in intelligence-sharing, as well as in real-time sharing of information that could lead to operations,” Mr. Fatemi said.

The Associated Press reported Friday that a second round of meetings aimed at ending the 14-year-old war in Afghanistan is slated for July 30 in China.

Waiting on India

Mr. Fatemi also expressed rising confidence that long-standing friction between Pakistan and India is beginning to ease.

The prime ministers of the nuclear-armed rivals made headlines early this month by engaging in a face-to-face meeting on the sidelines of major economic and security summits in the Russian city of Ufa.

After the meeting, Pakistan’s foreign ministry said the two agreed to cooperate on eliminating terrorism in South Asia. Indian Prime Minister Narendra Modi also accepted an invitation by Mr. Sharif to attend a South Asian regional summit in Islamabad next year.

But Mr. Fatemi suggested that India needs to make the next move to continue a thaw in relations, which have been particularly strained since the 2008 Mumbai terrorist attacks in which Pakistani militants killed 164 people in a series of coordinated shootings and bombings.

A resolution to the divided, disputed Kashmir region, a flashpoint for violence between the two powers, remains distant.

Mr. Fatemi said Islamabad is “ready to enter into a meaningful, comprehensive, sustained dialogue process” with India. “We have made this offer on so many occasions,” he said. “It is now for India to respond.

“Hopefully, there will be a response. Why? Because the two prime ministers agreed in Ufa, among other things, that the national security advisers of the two countries should meet. And since terrorism is the most urgent issue, they can discuss terrorism.”