For Germany, it's an economically promising but politically risky deal: the sale of three U-214 submarines built by German ThyssenKrupp Marine Systems to Pakistan for an estimated $2 billion.

In 2006 the German government gave its general approval after Pakistan and the company requested the sale. Berlin even granted federal export credit guarantees worth nearly $1.4 billion.

That was before Pakistan became infested with al-Qaida and Taliban insurgents who went on to destabilize the government and launch attacks into neighboring Afghanistan. Pakistan's political instability has caused Germany to delay the deal.

Contract negotiations have been dragging on for years. A delivery of the three subs to Pakistan would require the approval from Germany's national security council, and it has repeatedly postponed a decision on the deal. But that doesn't mean the sale is off the table: The Frankfurter Allgemeine Zeitung newspaper reports negotiations are still ongoing.

Pakistan's defense minister recently visited Berlin and a top Pakistani general will arrive in the German capital next week -- it's likely that the Siemens-engine-powered U-214 subs, which are able to run underwater at reduced speeds for up to three weeks, were and will be on the discussion agenda.

Observers say a final decision on the deal won't be made until shortly after the German federal elections in late September. The period in between two governments is often used to push through politically controversial deals.

Several German lawmakers oppose the sale, mainly because of Pakistan's instability and the region's overall volatility.

Berlin says it doesn't sell arms into politically unstable countries, but numbers prove otherwise.

German companies in 2007 sold weapons for $221 million to Pakistan, according to a government report.

Globally, Germany proves a successful export of high-tech weapons and weapons parts. According to the Stockholm International Peace Research Institute, Germany exported conventional weapons -- such as submarines, tanks or helicopters -- worth some $12 billion between 2004 and 2008. (Small arms and weapons parts amount to roughly the same amount.)

Compared with 1999-2003, German arms exports increased by 70 percent, SIPRI says. The country is now No. 3 in the global market, trumped only by Russia and the United States, which leads the world in arms exports.

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