TAPI gas pipeline may become game changer in South Asian geopolitics
Once completed, TAPI can become a game changer in regional geopolitics and regional economic integration. Due to significant transit revenues, it also has the potential to smoothen the ‘Decade of Transformation’ (1915-2014) for Afghanistan.analysis Updated: Dec 20, 2015 23:35 IST
Despite uncertainties about Afghanistan’s future, India-Pakistan ties, Afghanistan-Pakistan tensions and a slowdown in global energy markets, the TAPI (Turkmenistan-Afghanistan-Pakistan-India) gas pipeline finally took off as leaders from the four countries participated in groundbreaking ceremony in Mary, Turkmenistan. The event defied sceptics who have always considered TAPI’s relevance as limited only to academic and diplomatic conferences. Afghan President Ashraf Ghani called the event historic as the region was ‘renewing ties’ and ‘overcoming the history of doubt and scepticism’.
Although the 1,735-km pipeline has been under discussion since 1995, India was formally admitted as a member only in 2008. In the last 10 years, TAPI has been one of the main agenda items at every major conference on Afghanistan and also an integral part of the American ‘New Silk Road Strategy’. It is expected that the pipeline could now be operational in the next four years. TAPI is designed to transport 33 billion cubic metres of gas annually to South Asia for a period of 30 years.
Starting with Bridas, Unocal and Delta during the Taliban regime in the 1990s, many energy giants such as Chevron, Exxon and BP showed interest in the project. More recently, Total and Dragon Oil were in discussion with the Turkmenistan government. None of them, however, committed to the project either due to security and financial considerations or due to the reluctance of the Turkmenistan government to sign production-sharing rights for onshore blocks with foreign companies. As a result, countries agreed to a consortium of national oil companies of all four participating countries, with Turkmengaz, the national oil company of Turkmenistan, as the consortium leader. Gas Authority of India Limited is the Indian partner.
Vice President Hamid Ansari, who represented India at the event in Mary rightly called it ‘more than a project’ and ‘first steps towards unification of the region’. Turkmenistan, Afghanistan and Pakistan also signed an MoU for a power transmission line. The line will be constructed parallel to the TAPI gas pipeline. There are also plans to connect the four countries by a parallel fibre optic cable. For this reason Ghani called it a “super highway of cooperation and coordination that will connect again South Asia and Central Asia together”.
The strategic significance of the project is huge. Once completed, TAPI can become a game changer in regional geopolitics and regional economic integration. Due to significant transit revenues, it also has the potential to smoothen the ‘Decade of Transformation’ (1915-2014) for Afghanistan. If the project is completed successfully, it could bring together India’s ‘Connect Central Asia’ policy and China-Pakistan Economic Corridor (CPEC) of the Chinese ‘One Belt One Road’ project.
Due to China’s slowdown and the cut down of Russian gas purchases, the market dynamics of the Central Asian gas market are changing significantly. Turkmenistan exports gas to China, Russia and Iran. Both Russia and Iran have reduced their imports as they want to increase their own output. This will make China the sole export market for Turkmen gas. These factors might have pushed Turkmenistan to develop alternatives. And South Asia could be a winner in this changing geo-economics.
(Gulshan Sachdeva is director, Energy Studies Programme at JNU. The views expressed are personal.)