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India and Pakistan have expressed that they are serious about going forward with a proposed natural gas pipeline that would run from India to Iran through Pakistan.

The pipeline project was previously estimated to cost somewhere between four and five billion U.S. dollars, but now they are saying that it will cost more than that.

"That was an old estimate. Taking into account inflation, the large increase in steel prices, we think the project will cost $7 billion to $8.1 billion," a government source told Reuters.

India and Pakistan officials released a statement after two days of talks in New Dehli about the project, which is expected to be in the next five years.

"Both sides conveyed their serious commitment to address various issues pertaining to the project so as to maintain the momentum of the dialogue," said the statement. AFX News Limited reports:

India and Pakistan will meet again in August to thrash out remaining issues, including the pricing of gas, funding and legal aspects.

The two sides agreed to appoint separate financial consultants to advise on the project structure before signing an inter-government agreement that would allow work to begin early next year.

The project, which has been talked about for quite some time now, has been the target of criticism. U.S. Secretary of State Condoleezza Rice said a while back that New Delhi should explore other ways to meet its energy needs.

In response to such criticism, India's Petroleum Minister Mani Shankar Aiyar said, "We will not come under the pressure of any country."

Chris is a staff writer for WebProNews. Visit WebProNews for the latest ebusiness news.