Central-Asia-South Asia energy, trade corridor gets started

The new and big central Asia South Asia energy and trade corridor will get started on the ground on December 25, opening up all the electricity, natural gas, and oil resources of the region.

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The launch pad of the new zone consists of three main wings: Turkmenistan-Pakistan-Afghanistan-India, or Tapi, gas pipeline, Central Asia-South Asia-1000 (CASA-1000) electricity grid, and boosting regional trade by opening all the countries to business, and a drastic tariff-lowering, cost-effective transportation. It will also help the area by expanding use of oil and gas pipelines for energy within the region and to and from the region connecting UAE-Middle East-Saudi Arabia through the shortest route via the Pakistani port of Gwadar, and free business travel.

The Central Asian Republics, or CARs, located west and north of Pakistan and China have huge, untapped energy potential to feed the energy starved Afghanistan, Pakistan, India, South Asia, from the oil rich Central Asia stretching from Tajikistan to Karghezistan, Uzbekistan and the rest of CARs, the former Soviet states.

The CARs have also agreed to join the much bigger and ambitious $46 billion China Pakistan Economic Corridor, or CPEC, which will stretch from Shanghai to west and down South to Gwadar, in South Eastern Pakistan. CPEC and CARs- CASA have the potential of turning themselves into, perhaps, the world’s largest or No. 2 business, energy and industrial zone. It will be directly linked to UAE-Saudi Arabia and rest to the Middle East. Pakistan’s Gwadar link will also provide the shortest and the most cost-effective energy transportation and trade roué between UAE-Middle East to CPEC-CARs-CASA for oil, electricity and natural gas to flow – both ways.

Prime Minister Nawaz Sharif has just completed a series of negotiations during his visits to the CARs, where the top leaders of those countries vowed to complete CASA-1000 at the earliest.

The first part of the new energy zone will be linking up the region with 1,000 megawatts of an electricity grid. Its implementation on the ground will start December 25. This was jointly announced by Sharif and Tajik President  Emomali Rahman in Dushanbe. Sharif also had talks with Kazakhstan President Nursultan Nazarbayev, Kazakh Prie Minister Karim Massimov in Astana, and leadership of Turkmenistan and the other CAR countries who have decided to join these initiatives and projects.

The implementation of the big gas pipeline-component of the new energy-trade zone, Tapi, will start on December 25, as announced by Sharif, Turkmen President, Khaqan Abbasi, Minister for Petroleum and Natural Resources told this scribe, Tapi project will be completed in three to four years.

Turkmengaz company of Turkmenistan will lead construction of this 1,800 kilometer long gas pipeline. It will carry gas from Turkmenistan to Afghanistan, Pakistan and India. The company will lead the consortium for TAPI, and will oversee construction, financing, ownership and operations of the project.”

Turkmenistan has the world’s fourth largest  natural gas reserves. Tapi Ltd the operating company of the project includes Turkmengaz State Concern, Afghan Gas Operation, Pakistan Inter-State Gas Systems (private) Ltd, and Indian Gail-Ltd. They will have equal shares in the venture. Its total cost will be $25 billion, including $ 10 billion for the upstream portion, and $15 billion for the downstream part.

“Work on both the streams will start simultaneously. It will take three years to lay the pipeline from Turkmenistan to Hirat, which will go to Kandhar, and onto Chaman in Pakistan, Quetta, Dera Ghazi Khan, and Multan. It will, from there enter India. The shareholding will include: Turkmenistan 51 per cent and  Afghanistan, Pakistan and India each five per cent of the obligatory share. The balance 34 per cent shares will be sold to other partner countries. Afghanistan will receive an annul transit fee of $ 600 million,” said Abbasi.

CASA, to begin with, will provide 1,000 megawatts of power to Pakistan. But it is designed to transmit 1,300 megawatts of power from Tajkistan and the Kyrgyz Republic to Pakistan through Afghanistan.

The supply will start in July, 2018. The project cost is $1.170 billion. Tajik President Emomali Rahman and Prime Minister Sharif have just announced in Dushanbe that Pakistan will also explore further avenues of energy cooperation with the Central Asian Republics.

The two leaders also have also announced  to vastly expand the entire spectrum of bilateral relations, and extend these  to the entire region and the international market. Immediate steps will be undertaken to further expand cooperation in the field of economy, trade, investment, energy, transport, defense, security, education, science, and cultural sectors.”

They decided that Tajikistan-Pakistan Joint Commission on Energy and Infrastructure , established in June 2014, will meet twice a year to expand mutually beneficial cooperation in these fields

Tajikistan is Pakistan’s closest neighbor in Central Asia and is located at the confluence of South and Central Asia. It is the gateway to the region. Sharif has offered to all the CARs, Pakistan as the shortest possible route to the sea to countries in the region through its international ports of Gwadar and Karachi, located on the Arabian Sea.

“Our forward looking vision aims at further elevating the Pakistan-Tajikistan strategic relations to new heights and to go beyond CASA-1000,” Sharif said to the Tajik leadership and the people.

They agreed to “establish energy-and-trade corridor with the CARs” and to “start joint development projects in various fields.” Sharif invited Nursultan Nazarbayev to join-in in the projects being implemented under China Pakistan Economic Corridor (CPEC).”

He said: “Pakistan  is working on the Corridor project to enhance regional trade,” an objective with which Kazakhstan also agrees. They also agreed to form joint ventures in various fields including textiles, pharmaceuticals, other industries, ship building, and agriculture, Sharif said Pakistan will be happy to import gas and oil from Kazakhstan.

Sharif said, the quadrilateral agreement among  Pakistan, China, Kazakhstan, and the Kyrgyz Republic for traffic-in-transit should be fully used to boost to trade and economic cooperation. Afghan minister for Finance Iklil Hakimi, during his talks with Tajik leaders in Dushanbe stressed the need to start building Tapi in December.

Views expressed by the author are his own and do not reflect the newspaper’s policy.

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