Abstract
The energy crisis is not new to Pakistan. Pakistan has to rely on expensive imported natural gas. Pakistan can import cheaper gas from Iran via Iran-Pakistan (IP) gas pipeline. This project is yet to be completed (and operationalised) due to geopolitical conditions, including United Nations and the United States sanctions on Iran. This study aims to find the economic viability of the Iran-Pakistan gas pipeline using cost-benefit and double exponential smoothing forecasts methods. The study findings highlight Pakistan’s opportunity cost for delaying the IP project. The result suggests that during the 2013–2019 period, if Pakistan had imported its natural gas from Iran via the IP gas pipeline instead of importing it from Qatar via ships, Pakistan could save US$3.3 billion annually and a total of US$23 billion in this period. Furthermore, USA sanctions may make the project non-viable economically under the worst-case scenario.
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