Jul 31, 2009

Dushanbe Summit

The summit meeting of leaders of Pakistan, Tajikistan, Afghanistan and Russia in Dushanbe has called for an increase of foreign investment in hydropower projects, construction of transmission lines and development of transport infrastructure. The joint statement, which was issued after President Asif Ali Zardari, Tajik President Emomali Rahmon, Russian President Dmitry Medvedev and Afghanistan President Hamid Karzai held important meetings, highlighted the importance of the development and strengthening of economic and trade relations among the four countries. The four leaders have also made a decision of creating a favourable climate of investment in their respective countries and promote direct ties among their business communities. While President Zardari has said the meeting would “help the coming generations” President Hamid Karzai has acknowledged the meeting is the first important step for more cooperation in peace and development of the region. President of Tajikistan Emomali Rahmon rightly said that the joint statement reflected the aspirations of not only the four leaders, but also the nation and the people they represented. The presidents showed their concern over the increased illicit traffic of drugs as a main source of terror funding. The leaders have also asked the World Bank and other international financial institutions (IFIs) to give assistance for the implementation of economic projects in the region. The Central Asian republics (CARs) are rich in oil and other mineral and energy resources that can be utilized by the landlocked Afghanistan and energy-starved Pakistan. In Pakistan, for instance, electricity is the major need of both industrial and domestic consumers. People had been told last year that agreements were in final stages to generate 1500 MW electricity within a year, besides buying 1,000 MW from Tajikistan and Kyrgyzstan. Pakistan needs to generate an additional 5,500 MW by the year 2010. In 2006, the US had planned a project to transmit electricity from Central Asia across Afghanistan to Pakistan and India. Under the plan, a regional power grid stretching from Almaty to New Delhi would have to be fed by oil and gas from Kazakhstan and Turkmenistan and hydropower from Tajikistan and Kyrgyzstan. The way in which energy is used is one of the defining characteristics of an economy. Growth of an economy requires energy, and high growth rates require high levels of consumption of cheap and abundant energy. Pakistan needs energy like a human being needs oxygen to breathe. For our economy to keep breathing, energy is a must, and no stone can be left unturned in this endeavour. If Pakistan is planning on importing electricity from Central Asia via Afghanistan, it first needs to make sure that the situation in Afghanistan is settled down completely. There is no guarantee whether the situation will be settled soon. Even if all is well, there remains the problem of pricing. The idea of importing energy should be looked into as four or five years down the road the demand for electricity would have increased. Tajikistan can help meet Pakistan’s energy requirements. If the agreements envisaged come to pass in future, Pakistan would be able supplement its income with the transit fees that might accrue from the supply of Central Asia’s surplus gas and electricity resources to India and China. At the same time, via the proposed land routes to Central Asia, Pakistan could be provided just the right edge to market its own agricultural and industrial products. The more quickly the projects are started and completed, the better it would be for the whole region.

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