India expects to sign a deal 'by next month' on a pipeline that will transport gas across the Sub-continent from Iran, Indian oil minister Murli Deora said.

He said the $7.5 billion project to bring gas from Iranian fields to India and Pakistan had been discussed on the sidelines of the World Petroleum Congress (WPC) industry event, which ended in Madrid on Thursday.

'We discussed this here again on Wednesday. There should be an end to dialogue now,' Deora said.

'The only issue is where to take the delivery, the delivery point,' he said, adding the two options were on the India-Pakistan border or the Pakistan-Iran border.

'But these things are being sorted out at a very high level now, and I hope by next month things will be okay,' said the minister.

Asked when the deal could be signed, he said: 'I hope by next month.'

Talks on the 2,600km Iran-Pakistan-India pipeline began in 1994 but were stalled by tensions between India and Pakistan and disagreements over prices and transit fees.

India and Pakistan reported last month that they had resolved commercial differences holding up the deal.

India has been under pressure from the US not to do business with Iran, viewed in Washington as a state sponsor of terrorism and seen as bent on acquiring nuclear weapons.

But New Delhi, which imports more than 70 per cent of its energy needs, has been trawling for new supplies of oil and gas while ramping up domestic production to sustain its booming economy.

Earlier this year, New Delhi told Washington not to interfere in its dealings with Iran after a State Department spokesman said Washington would like India to put pressure on Tehran over its nuclear programme.

India in 2005 signed another deal with Iran, which has the world's second largest known gas reserves after Russia, for the supply of five million tonnes of gas annually for 25 years.

Deori also rejected criticism that rising energy demands in India and China were helping to push up oil prices.

'I dont think that issue should have found place here (at the WPC),' he said.

'I think that China and India are consuming a small portion of the energy, and to blame them - that the sole reason for price increases is India and China - I don't think that's fair,' he said.

Divisions appeared to be growing between the oil powers and consumer nations at the congress over how to bring down the oil prices, which hit 145 dollars a barrel yesterday.

But Deora rejected suggestions that the four-day WPC congress had been a failure.

'There has been some movement. The very fact that everybody met and everybody spoke about different angles and different ideas is a great achievement. You don't expect the price of oil to go down to $30. You have a dialogue and you present your views.'