Pakistan and India have agreed to give top priority and accelerate preparations for a proposed gas pipeline from Iran to South Asia, saying the nearly $4 billion  project will help strengthen ties and fuel their energy-hungry economies.

Speaking to reporters at the end of his talks with Pakistani leaders Tuesday, Indian Oil Minister Mani Shankar Aiyar said the two sides discussed not only a pipeline from Iran, but also from Turkmenistan and Qatar.  The minister says that work on the Iran-Pakistan-India (IPI), pipeline is expected to begin within the next six months.

"There has been positive forward movement and there has been milestones put in place,? he said. ?I am hoping that in consequence of this we will be able to report substantial progress by the end o the year. Of the three projects, it does look as if it's likely that in the phasing of the three projects, it will be the IPI that takes off first."

The nearly 2,800-kilometer pipeline will transport natural gas from Iran to India through Pakistan.  Tehran proposed the project in 1996, but it has never gotten off the ground mainly because of India's tense relations with Pakistan. But in the wake of rapid improvement in the bilateral ties, Minister Aiyar says the discussions on the security of the pipeline are also progressing well. 

"We have now moved from the stage of asking questions about security, to addressing security concerns in a serious and sincere manner," he added.

Responding to questions about Washington's opposition to the proposed pipeline project from Iran, Mr. Aiyar says his government understands the concerns, but needs energy.

"The U.S. has mentioned its concerns to us. As far as India is concerned, we have said to them that we are sensitive to their concerns and we trust that they are aware of our requirements,? he noted. ?You are hoping to make a headline, I am trying to lay a pipeline.?

Mr. Aiyar says he will hold talks with Iranian officials later this week to discuss the project, particularly its cost and security.

Meanwhile, U.S. ambassador to Islamabad in a written statement, denied the United States is pressuring Pakistan against importing natural gas from Iran.  Local media quoted Ambassador Ryan Crocker as saying, "the U.S. government does not believe in exerting pressure on strategic partners like Pakistan on any question.?  Mr. Crocker said there is U.S. legislation against investment in Iran but that President Bush can always make an exception if it is in the U.S. national interest.