Prime Minister Manmohan Singh is believed to have favoured India, Pakistan and Iran together building the over $7 billion gas pipeline, since joint participation will make the project more secure.
Sources said Singh conveyed very strong support for the 2,100-km long pipeline project when visiting Pakistani Oil Minister Amanullah Khan Jadoon called on him on Friday.
Earlier, the Petroleum Ministry was contemplating buying natural gas at its border and not participating in the pipeline's construction.
The petroleum ministry had earlier suggested that India enter into an agreement only with Iran for purchase of gas at its border and Tehran would have had to court Islamabad for safe passage of the pipeline, uninterrupted supplies and delivery of gas at Indian border.
But now, the petroleum ministry is believed to have dropped that idea and favoured India's participation in building the gas pipeline.
The inter-ministerial discussions on the pipeline between India and Pakistan, which are going on at present here, would focus on evolving a joint strategy for negotiating gas price with Iran and a project structure.
The bilateral meeting between the two countries is a precursor to a trilateral meeting between the three sides in March-April.
India, Pakistan, Iran to hold talks next month
India, Pakistan and Iran will, for the first time, hold a tri-partite meeting on the over $7 billion Iran-Pakistan-India pipeline next month.
The meeting would take place in Tehran, an official said after the ministerial meeting between India's Petroleum Minister Murli Deora and Pakistan's Foreign Minister Amanullah Khan Jadoon.