BearingPoint AEGP Public Relations and Media Office
Weekly Press Review - February 25 – 3 March
Industrial parks first step towards industrialization
Afghanistan pins its hopes on pistachios
ADB has researched for a year on gas pipeline
Third Afghanistan Development Forum to be held
Kabul Mustofiat has collected 600 million Afs revenue in a year
Women are being trained on business management
Role of women in Afghanistan’s economic development
Imbalance in Afghan-Pak trade relations
Afghan-Pakistan economical relations increasing
The new business receipt tax is implemented
Delhi puts a dent in Karzai's dreams
In aid of friendship
World Bank says drugs now Afghanistan's economic lynchpin
Price of fuel in remote Badakhshan province has quadrupled because of adverse weather conditions
Dollarisation sweeps Kabul's Shahr-e-Nou streets
Uzbekistan seeks greater Afghan rebuilding role
Turkmen, Afghan presidents to meet to discuss trans-Afghan gas pipeline
Cart-vendors in Kabul streets say municipality order has reduced bribe taking among police
Pakistan exports to Afghanistan touch US$670 million in Jul-Jan
Common bazaars established along border with Tajikistan
Afghan amputees to get tiling plant
Solar power supply to be produced
India to grant 100 USD million for power supply in Afghanistan
Pakistan welcomes Afghanistan's interest in SAARC
Indian space research organization plans Telemedicine link with Afghanistan
Afghan government takes steps to curb gas prices
Unemployment brings people on the roads in Herat
Citizens of northern Mazar demand speedy road reconstruction in their city
The main reason for corruption and weakness of judicial organs is bank inefficiency in collecting debts
DCCI calls to set up Afghan business Council in Dubai
Cooperation Agreement Signed
Sri Lanka to welcome Afghanistan, but not Iran, to SAARC
USA to donate 20 tons of soybean oil to Afghanistan
USA to grant 15 million USD to Afghanistan
France contributes $16 million
Afghanistan wants transit route through Pakistan
India to set up telemedicine centers across Afghanistan
Afghanistan mobile phone company Roshan Telecom wins global GSM award for best marketing campaign
India warms up to Afghanistan
Afghanistan and future of the region
Karzai lauds India's assistance to Afghanistan
Afghanistan seeks role in enlarged Saarc
A Kabul-Bangkok highway, via India
Priorities coincide in Afghanistan, Iraq, Sudan/Darfur, Palestinian Territories
Turning the Lights On in Kabul
Businessmen Targeted by Kidnappers
India, Afghanistan sign civil aviation pact
India renews pledge to rebuild war-ravaged Afghanistan
The Ministry of Foreign Affairs will host the 3rd Annual Afghanistan Development Forum
Karzai's India Visit Could Increase Regional Trade Links
India to upgrade airline, TV satellite links in Afghanistan
India, Afghanistan decide to resume direct flights
Afghanistan energy ministry calls on Shri PM Sayeed
Afghanistan’s Independent Radio Heading towards Self-Sufficiency
Karzai seeks Indian doctors
President Karzai’s Statement on the Launching of Afghanistan’s First National Human Development Report
Afghan Living Standards among the Lowest, U.N. Finds
Delhi puts a dent in Karzai's dreams
By: Sudha Ramachandran
BANGALORE - Afghan President Hamid Karzai's three-day visit to India last week saw the two sides firming up several deals boosting bilateral cooperation. However, Karzai's enthusiasm for Indian involvement in an oil pipeline project seems to have not been reciprocated in equal measure by India.
Karzai's visit to New Delhi was his third since the fall of the Taliban and the first since his election in October last year as Afghanistan's president. Relations between India and Afghanistan plunged to an all-time low during the years of Taliban rule, when Delhi was a key supporter of the Northern Alliance. Over the past three years, Delhi has built a strong presence in Afghanistan and bilateral relations have improved dramatically.
India has participated in a big way in Afghanistan's reconstruction, having committed to a total of US$400 million as assistance to the war-ravaged country over the 2002-2008 period. This puts India among the top six contributors to Afghanistan's reconstruction.
Of this assistance, India has committed $84 million for the up gradation and reconstruction of the 213 kilometer Zaranj-Delaram road. The road is the result of an Afghanistan-India-Iran project that envisages development of trade with Central Asia. The route will take goods from the Iranian port of Chabahar to Afghanistan and other Central Asian countries.
Another $80 million has been set aside for the construction of the Salma Dam power project in Herat province. India is also funding the construction of a new parliament building in Afghanistan. Among the projects that India has taken up are the reconstruction of the Habibia School in Kabul - the alma mater of the ruling elite and the influential in this country, a major power transmission project to alleviate Kabul's severe power problems, supply of airplanes for civil aviation and buses for public transport and the repair of a famous mosque in the northern city of Mazar-e-Sharif.
India is involved in training Afghanistan's bureaucrats, judges and lawyers, and police personnel. It has sent scores of doctors and engineers to work in Afghanistan, to train and rebuild this country. An information technology specialist has been deputed to the Afghan government.
India's policy in Afghanistan is aimed at not only winning the hearts and minds of the Afghan people but also ensuring that anti-India elements (the Taliban and Pakistan) are kept out of Afghanistan's power structure. An official in the Indian Ministry of External Affairs (MEA) says
that "India sees Afghanistan as a springboard to the realization of its long-term economic, energy and security interests in the Central Asian region".
During Karzai's trip to India, more steps were taken to consolidate bilateral ties. Two accords on enhancing cooperation in civil aviation and media and information were signed. The memorandum of understanding (MoU) on cooperation in the field of civil aviation is aimed at building capacity and strengthening the institutional structure of Afghanistan's civil aviation sector. It includes training in areas of airport management, air traffic control, navigational aids etc, including safety and maintenance of aircraft. The MoU on cooperation in the field of media and information calls for greater interaction between the media and radio and television organizations of the two countries.
But despite the small but significant steps that were taken during Karzai's trip, the Afghan president might have gone home a slightly disappointed man. He was hoping to convince Delhi to look favorably at a $3.3 billion pipeline project that envisages piping gas across roughly 900 miles from Turkmenistan through Afghanistan and Pakistan and on to India.
Delhi's involvement in the Turkmenistan-Afghanistan-Pakistan (TAP) pipeline project is essential for its economic viability. The pipeline project could contribute significantly to Afghanistan's economy.
While India has been keen to push ahead with the Iran-Pakistan-India pipeline project - provided Islamabad will ensure security of the pipeline - it has not shown similar enthusiasm for the TAP pipeline, as it believes that this might not make economic sense for India. There are sections in India who are warning that problems with regard to the Iran-Pakistan-India pipeline project are likely to surface soon. "The growing tensions between America and Iran in the second Bush administration would suggest inevitable US opposition to the project," points out C Raja Mohan, a professor at the Jawaharlal Nehru University in New Delhi.
However, India's MEA has more misgivings about the feasibility of the TAP pipeline. It has serious doubts over whether Turkmenistan has sufficient gas reserves to dedicate to this pipeline. Estimates of the potential of the Turkmen gas fields vary considerably. While some believe it could perhaps possess the world's fourth largest supply of gas, others peg the production potential much lower.
A report in the Indian Express, a national English daily, points out that "Turkmenistan's gas production last year was 58 billion cubic meters [bcm], of which 35 bcm was exported to Ukraine and smaller volumes to Iran and Russia. About 11 bcm was used for domestic consumption." The report goes on to argue that while Turkmenistan would increase its production to about 120 bcm by 2007, it has committed to supply Russia with large amounts of gas. "In fact, nearly 70 bcm of the projected 120 bcm is believed to be contractually committed to Gaz prom," the report said.
The MEA has drawn the attention of India's Petroleum Ministry to the fact that if India takes into account Turkmenistan's commitments to Russia, Ukraine and Iran as well as its own domestic needs, "there will be little available for further export". India is therefore concerned that the
amount of Turkmen gas that it can avail might not be enough to justify its investment in the project.
An official in the MEA told Asia Times Online, "Pouring money into the Turkmenistan-Afghanistan-Pakistan-India pipeline doesn't make economic sense for India. The returns are not adequate. India investing in it will make the project economically viable but not for India."
The MEA official said that India is still looking into the matter and that a proper assessment of the project and of an Asian Development Bank report on it will have to be made before India makes its decision. Until then, India's response will be "non-committal and cautious".
The TAP pipeline project needs India's involvement to be economically viable and India will join in only if it is convinced that the rate of return on it is adequate to justify its investment and that there is more for it in the pipeline than goodwill alone. India's decision on the project hinges on simple economics. Afghanistan's pipeline dreams seem a long way off from being fulfilled.