“Pakistani officials confirmed Wednesday that Industrial and Commercial Bank of China had withdrawn from plans to head a consortium that would finance the $1.6-billion Pakistani portion of the cross-border pipeline, apparently over concern that the bank could be excluded from the U.S. economy.
The move suggests that even Chinese companies, which have staunchly resisted U.S. and European efforts to punish Iran for its nuclear program, are beginning to bend to the sanctions on Tehran. China’s unwillingness to fully cooperate had been one of the greatest challenges to the international effort to put economic pressure on Iran. China’s decision is a setback for the Pakistani government, which fears that dire energy shortages could lead to civil unrest as well as economic strain. Pakistani officials said they would press ahead with the project, which would deliver more than 750 million cubic feet of natural gas per day from Iran’s South Pars field. They said they would find replacement financing.………….”
The United States administration has been trying to derail this gas pipeline project for some time now. Pressure on the Pakistanis and offers of a more expensive pipeline did not work, and the Chinese for a while seemed impervious to pressure as well. Blocking this pipeline will harm Pakistan much more than Iran, especially beyond the short term. That country is facing a deepening energy crisis and the vast Iranian gas fields are the closest and most efficient source for it. Iran has the largest reserves of natural gas in the world outside Russia, and it has no shortage of clients, especially beyond the short term.
The Obama administration’s State Department is now firmly under the control of the Likud-niks; which means that administration foreign policy itself is under Likudnik control. The old Arabists are long gone from the corridors of power, replaced by Likud-niks. The term “Arabist” itself is now probably a suspect nearly derogatory term at Foggy Bottom and in Washington; in the U.S. Congress “Arabists” can get stoned these days.