Re: the previous post, I’ve just been reminded how quickly things change. The Central Asianist podcast in question is about a year old, and a lot seems to have happened since then. With a view to making sense of all this, here are some articles detailing what’s been going on in the world of Central Asian logistics over the last year:
December 13, 2015
The so-called Turkmenistan-Afghanistan-Pakistan-India (TAPI) project aims to export up to 33 billion cubic meters (bcm) of natural gas per year through the approximately 1,800-kilometer pipeline.
Experts say TAPI presents an opportunity for regional cooperation at an unprecedented scale linking the economies of the four countries together and enhanced energy trading between Turkmenistan, Afghanistan, Pakistan and India.
India will pay up $250-million in transit fees to Pakistan which will pay the same amount in transit fees to Afghanistan.
The project is considered a key opportunity to help ease growing energy deficits in India and Pakistan. Officials in Turkmenistan expect gas link will be fully operational by the end of 2019.
Pakistani officials say they expect to receive gas via TAPI in 2019.
But ensuring security of the proposed pipeline remains a major challenge as it would pass through insurgency-hit parts of Afghanistan and Pakistan.
24 August, 2016
Citing Nicolas Gvosdev, a Russia expert at the Naval War College in Newport, R.I., LaFranchi explains what lies at the root of Russia’s success in Syria.
“Russia has been able to reassert itself in the region partly because it set out limited goals — something the US might consider taking a cue from,” the US journalist writes, adding that these limited goals “are part of a much broader vision for Russia’s presence in the Middle East.”
Indeed, while Turkey is a key element of Russia’s Turkish Stream pipeline project, aimed at delivering natural gas to Europe bypassing Ukraine, Iran plays an important role for both North-South International Transport Corridor (ITC) and the China-led One Belt One Road (New Silk Road) initiative championed by Russia.
Remarkably, online media outlet PolitRussia.com noted recently that Middle Eastern stability is of ultimate importance for Moscow in the context of bold infrastructural projects kicked off by Russia and other major Eurasian powers in the continent.
14 October, 2016
Turkmenistan has borrowed $700 million from the Islamic Development Bank (IDB) to finance the construction of a natural gas pipeline through Afghanistan to Pakistan and India
The $10 billion TAPI (Turkmenistan, Afghanistan, Pakistan and India) pipeline, originating at the giant Galkynysh gas field in Turkmenistan would carry 33 billion cubic metres (bcm) of gas a year.
Turkmenistan will use the 15-year IDB loan to finance construction work and equipment purchases, the country’s state news agency said.
3 January, 2017
Turkmenistan has limited natural gas supplies to Iran since Jan. 1 over unpaid past deliveries, the Turkmen Foreign Ministry said on Tuesday, a day after Iran said supplies through a cross-border pipeline had been cut off.
The ministry said Ashgabat, which exports to Iran about 9 billion cubic metres of gas a year, made the move after trying unsuccessfully to collect debts from the National Iranian Gas Company (NIGC) since 2013. It did not disclose the amount owed.
However, Iran’s National Gas Company (NIGC) condemned the move by Turkmenistan as a violation of a bilateral accord.
“Cutting the gas flow is an obvious violation of the deal … Referring the dispute to international arbitration is on Iran’s agenda,” it said in a statement published on the Iranian Oil Ministry’s website SHANA.
5 January, 2017
Backed by the US, TAPI was conceptualised in 1995. However, the project failed to take off due to geopolitical tensions among the member-countries.
Additionally, Taliban insurgents, who control vast swathes of territory in Afghanistan, threatened to disrupt the project.
In recent years, though, the project gained some traction, largely owing to the Obama administration’s Afghanistan redevelopment programme.
It also obtained funding support of $700 million from the Islamic Development Bank last November.
Trump’s stance on TAPI will be a “deciding factor” for the project, official sources told BusinessLine. It seems that the Indian government will adopt a wait-and-watch approach, according to an official.
The official said that since the project has security concerns, the decision to resume talks on obtaining the Turkmenistan gas from Pakistan rests on the new Army chief. The Army’s official position is crucial, given the security implications.
However, during the recent ‘Heart of Asia’ conference, during a meeting between Prime Minister Narendra Modi and Afghan President Ashraf Ghani, India had asked Afghanistan to explore the option of routing the Turkmenistan gas from Afghanistan via Iran’s Chabahar Port, effectively bypassing Pakistan, said another official, who refused to be identified.
26 January, 2017
Tehran said in December that Turkmenistan had threatened to stop gas exports because of arrears in payments, which amounted to about $1.8 billion and dated back more than a decade. Iran wanted to refer the issue to arbitration.
Iran has its own major gas fields in the south of the country but has imported gas from Turkmenistan since 1997 for distribution in its northern provinces, especially during the winter.
Turkmenistan in turn faces a foreign currency shortage after Russia, once a major buyer of its gas, halted purchases last year, leaving China as its biggest customer.
18 May, 2017
An stakeholders conference on the subject INSTC-Express Corridor from India to Russia was held at Foreign Service Institute on May 18, 2017 at 1100 hours. The attendees at FSI were members of diplomatic community, freight forwarders, media, representatives of various ministries, officers and staff of Foreign Training Institute. Online attendees included members of Indian Embassy in Eurasian region, ICWA and members of business community.
The opening remarks were delivered by Joint Secretary Shri G V Srinivas (Eurasia) of MEA and by Mr Alexey Pogonin, Counsellor (Political) of the Russian Embassy in New Delhi. The keynote speakers were Shri Shankar Shinde from Federation of Freight Forwarder’s Association of India (FFFAI) and Shri Balachandran, Shri Behuria and Amb Stobdan from IDSA (Institute of Defence Studies and Analyses). The discussion centred around possible routes of INSTC, its popularization, development and optimal utilisation of Chabahar port to complement INSTC and to provide connectivity to Central Asia, modalities of and impediments to multi-modal transport, way ahead, Indian decision to join TIR Convention and advantages of moving beyond to e-TIR etc.
This was followed by a presentation from Kalinga Motors Sports Club (KMSC), Bhubaneswar on a proposed motor rally between India and Russia as part of 70th anniversary celebrations of establishment of diplomatic relations between India and Russia. Kalinga Motors agreed to put up the details of motor rally shortly on its website.
23 May, 2017
The latest bit of regional glad-handing came this week when Mirziyoyev visited his Turkmen counterpart along the Caspian coast… As Fergana News noted, “Uzbekistan intends to participate in the construction of the TAPI gas pipeline,” adding that Mirziyoyev “said that he ‘voiced a proposal’ about the participation of the Uzbek side in the TAPI project.”
Everything from Indian-Pakistani relations to security in Afghanistan continue to beleaguer TAPI’s prospects. And now, as The Diplomat’s Paolo Sorbello recently noted, Turkmenistan’s own gas industry is on its heels, tossing that many more questions at TAPI’s feasibility.
Mirziyoyev’s pronouncement shouldn’t be dismissed out of hand; if nothing else, there’s no harm in nodding toward improving regional relations. But Tashkent’s participation is not the silver bullet TAPI needs — even if it could bring a few more photo-ops along the way.
1 June, 2017
Prime Minister Narendra Modi is visiting Russia at a time when Delhi-Moscow relationship appears to have taken a dip. Modi faces two-pronged challenge. First, to strengthen the confidence India and Russia have enjoyed as strategic partners for decades. Second, take measures to bring Moscow out of the worrisome China-Pakistan-Russia triangle, more so after the start of Beijing’s imperialistic ‘One Belt, One Road (OBOR) project.
Much before the launch of China’s OBOR, India, Russia and Iran had signed an agreement to establish the INSTC in September 2000. It entered into force on May 16, 2002 following ratification by the three countries. Later, 11 other countries joined the project. They are: Armenia, Azerbaijan, Belarus, Bulgaria (observer status), Kazakhstan, Kyrgyzstan, Oman, Syria, Tajikistan, Turkey and Ukraine.
INSTC is a 7200-km-long proposed multi-modal (ship, rail and road) transportation system connecting Indian Ocean and Persian Gulf to the Caspian Sea via Iran to Russia and North Europe. If complete, the INSTC would allow faster movement of goods from India to these countries.
According to ‘Russia & India Report’, the INSTC project was first proposed at the start of 21st century, when the three countries– India, Iran and Russia — discussed the possibility of reviving the ancient transport route.
The report says that “the main ITC route begins in the ports on the west coast of India (particularly Mumbai), passes along the sea to the Iranian ports of Chabahar and Bandar Abbas, and from there by land to Iran’s Caspian Sea coast and beyond – or across the Caspian Sea to Astrakhan, or overland to Central Asia or the Caucasus to Russia and northern Europe.”
Here are some important features of INSTC:
INSTC will provide India speedy access to central Asia, Europe, and Eurasia.
The route of INSTC passes through Iran’s Bandar Abbas port, which can later be linked to Terhran’s Chabahar Port, where India has set up some major infrastructure projects.
INSTC will help connect India with five central Asian countries and also to the Eurasian nations, helping in improving India’s trade with countries like Kazakhstan, Turmenistan and Uzbekistan.
INSTC can aslo be aligned with Trans-Afghan rail line being developed by India, Iran, Afghanistan and Uzbekistan.
Seventeen years have passed since the start of the project but it is yet to be started. While the scale of China’s OBOR is bigger than INSTC, the latter, coupled with the proposed Asia-Africa sea corridor by India and Japan, would help New Delhi present an effective counter to China’s OBOR.
Reports say that India is also exploring the possibility of developing a 700-km rail line between Mazar-e-Sharif and Herat in Afghanistan. This will help link central Asia with Chabahar. It is believed that India aims to use Chabahar port in Iran in the same way as China wants to use Gwadar port in Pakistan, which is just 72 km east of the Iranian port. Considering the rapidly changing geopolitical dynamics in the world, India needs to take steps for the faster completion of the ambitious INSTC project.
20 June, 2017
The proposed 7,200 km long international corridor INSTC will support the growth of Indian exports by reducing transport cost by USD 2,500 per 15 tonnes of cargo, a study has claimed. International North–South Transport Corridor (INSTC) is a multi-mode network of sea, rail, and road route for moving freight between India, Russia, Iran, Europe and Central Asia. As per a study conducted by the Federation of Freight Forwarders’ Associations in India (FFFAI), moving cargo over the INSTC will be 30 per cent cheaper and 40 per cent shorter than the current traditional route. The traditional Suez Canal route takes 45-60 days whereas the INSTC would take 25-30 days. The INSTC is likely to increase trade connectivity between major cities of Mumbai, Moscow, Tehran, Baku, Bandar Abbas, Astrakhan, Bandar Anzali. According to Subhasis Ghosh, Director of Maritime World Services, the progress on cargo movement on INSTC would be discussed on September 16, 2017 on the final day of the three- day Maritime Nation India 2017 Tradeshow which commences in Mumbai on September 14, 2017.
The INSTC International Conference -2017 is being conducted by the Federation of Freight Forwarders’ Associations in India (FFFAI) and is supported by the Ministry of Commerce.
Ghosh said INSTC could be viewed as an alternative to the Suez Canal route, which takes longer and is more expensive for Indian cargo destined for trade with Eurasian countries. Ghosh said the INSTC, on its implementation, would also boost bilateral trade between Russia and India. The successful activation of the corridor will help connect India to Russia within 16-21 days at competitive freight rates leading to development of trade on the INSTC. At present, one has to either use Rotterdam port or land route via China to reach Russia and Central Asia. These are long, expensive and time-consuming.
The plan is to move goods from Jawaharlal Nehru and Kandla ports on India’s west coast to Bandar Abbas (Iran) by sea. From Bandar Abbas, the goods will be transported to Bandar-e-Anzali (Iranian port on Caspian Sea) by road and from there to Astrakhan (a Caspian port in Russia) by sea. The goods would then be transported into Russian Federation and Europe by Russian railways. India and Russia have fixed a target of USD30 billion trade volume to be achieved by 2025. Presently, bilateral trade between both nations is extremely low and it was just $9.51 billion.
If India partners with Eurasian Economic Union (EEU), it will further boost and expand its economic, trade and investment opportunities in more countries in this region.
30 July, 2017
As of next week, the Islamic Republic will no longer need to import natural gas from Turkmenistan, Iranian lawmaker Assadollah Qarehkhani said.
According to a Farsi report by ICANA, a new pipeline is to become operational in northern Iran in the coming days, which would obviate the need for imports of natural gas from Turkmenistan.
The 175-km pipeline, which measures up to environmental standards, will meet the need for natural gas in north of the country, said Qarehkhani, who sits on the Parliament’s Energy Commission.
With the pipeline coming on line, he said, there will be no drop in the pressure of the supplied natural gas anymore.
The MP then touched upon a lawsuit filed by Iran with the International Court of Justice against Turkmenistan for its breach of commitment, and said the country will demand damages from Ashgabat.
“Turkmenistan has pulled out of the agreement unilaterally without any justifiable excuse and has illogical demands from Iran,” he said.
In its lawsuit, he added, Iran has also called on the court to get Turkmenistan to reduce the price of its natural gas exports.
“Turkmenistan put Iran in a bind by increasing the price of natural gas in 2007 when Iran had no other alternative for the gas imports; hence, Turkmenistan should pay fines for its breach of obligations,” said the legislator.
“If Iran’s demands related to natural gas imports from Turkmenistan are met and the two countries reach a compromise on natural gas imports, we can import natural gas from Turkmenistan, and, instead, export Iran’s natural gas to western neighbours via swap deals,” said the lawmaker.
14 August, 2017
India and Turkmenistan on Monday discussed ways to establish a transport transit corridor between Iran, Oman and Turkmenistan.
Nitin Gadkari, Minister for Road Transport and Shipping, met Rashid Meredov, Deputy Prime Minister and Trade Minister of Turkmenistan, on Monday.
The two sides discussed India’s joining the Ashgabat Agreement that envisages establishment of International Transport and Transit Corridor between Iran, Oman and Turkmenistan, said an official source. They also discussed ways to expand and deepen bilateral cooperation.
In 2016, the Indian government decided to accede to the Ashgabat Agreement, a move that would enable the country to utilise this existing transport and transit corridor to facilitate trade and commercial interaction with the Eurasian region. India would become party to the agreement after consent from the founding members.
Further, this move would also be in synch with India’s efforts to implement the International North South Transport Corridor (INSTC) for enhanced connectivity. INSTC-Express Corridor is a transport link between India and Russia.
15 August, 2017
India will host the next steering committee meeting of the proposed 1,814 kilometre-long Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline.
“I strongly believe in this project, and this is the position of Turkmenistan,” Mr. Merodov said at a small interaction.
Officials told The Hindu that the pipeline, that had its ground-breaking ceremony in December 2015, has seen flagging interest since then for a number of reasons. India’s effort is to tap Turkmenistan’s Galkynysh gasfields, which are the fourth largest in the world.
The move is also an effort by the government to stave off any Chinese interest in the project, given that Turkmenistan is a close partner of China in its Belt and Road initiative across Central Asia, and Beijing is the largest buyer of its gas. Even the Galkynysh gas basin is being developed under a loan from the Chinese Development Bank (CDB).
Responding to Indian sovereignty concerns about the China-Pakistan Economic Corridor (CPEC), which passes through Pakistan-occupied Kashmir, Mr. Meredov said Turkmenistan was “open to all economic cooperation, which is how all such projects should be seen. India is and will be one of the most important countries for Turkmenistan.”
20 September, 2017
India and Turkmenistan will explore the possibility of expanding the International North-South Transport Corridor (INSTC) by linking it to the Kazakhstan-Turkmenistan-Iran rail link.
This was decided at the the 13 th meeting of the India-Kazakhstan Inter-Governmental Commission (IGC).
24 October, 2017
The Rasht-Astara line connecting Iran and Azerbaijan is almost complete and operations may commence early next year. The connection is the missing link on the International North–South Transport Corridor (INSTC), a 7,200 kilometer-long freight route connecting India, Iran, Azerbaijan and Russia via ship, rail and road.
The Astara-Astara line links the two cities of the same name via ten kilometer of rail, of which eight kilometers lie in Azerbaijan and two in Iran. The construction of the section in Azerbaijan is already complete, while the Iranian stretch nears completion, deputy director general for international affairs at the National Republic of Iran Railways (RAI) Mozhgan A. Kordbacheh recently said.
The railway, with a total cost of 51 million Euros includes the construction of a bridge over the Astarachay River and four terminals for the handling of containers, oil, grain and general cargo. It was expected to become operative in January this year, but due to several delays the current expected launch date is in February 2018.
The Astara-Rasht is the longest section on the line, with 164-kilometers of railway connecting the Iranian cities. Currently, 162 kilometer has already been completed, Kordbacheh said. RAI is actively negotiating with foreign partners about the financing scheme of the project, totalling a cost of 425 million Euros. In the coming weeks, talks in this regard are held in Azerbaijan’s capital Baku.
The Rasht-Qazvin section comprises of 163 kilometers of railway, of which 95 per cent has been completed. The remaining construction work is expected to be completed by the end of 2017, Kordbacheh revealed.
The Astara-Qazvin line forms an integral part of the International North–South Transport Corridor (INSTC), as it will reduce journey times between Mumbai and Moscou from forty to fourteen days. Test runs have already been carried out, while a dry run was conducted a few months ago. It is anticipated that in the future ten million tonnes of freight will be transported within the network.
Apart from constructing the missing link, parties involved aim to apply competitive tariffs in order to support growth on the corridor. Moreover, up-to-date transport services and simplified customs clearance of cargoes must be realised, the Iranian and Azerbaijani rail companies agreed at a recent meeting. The main objective of the INSTC is to provide an alternative to the traditional routes carried out by sea through the Suez Canal and the Mediterranean and the Baltic Sea. A south-west offshoot is also under consideration, connecting Iran, Azerbaijan, the Black Sea and Europe.