Will TAPI Remain a Pipedream?

27 Aug, 2008    ·   2661

Raghav Sharma is skeptical about the prospects for the gas pipeline


On 25 April 2008, Turkmenistan, Afghanistan, Pakistan and India (TAPI) signed a Gas Pipeline Framework Agreement, committing to the construction of an ambitious 1,680km-long pipeline to transport 30 billion cubic meters of natural gas every year by 2015, at a cost of US$7.6 billion. Hailed as a step towards realizing much needed energy security, TAPI is vital to sustain India's growth momentum while the fragile and cash-strapped Afghan government hopes to earn US$160 million in annual transit fees and inject some life into its economy. Meanwhile, the US appeared to be inching closer to achieving its implicit goals of keeping Iran isolated by pushing the rival Iran-Pakistan-India (IPI) pipeline onto the backburner and encouraging a diversification of Central Asia's energy markets and thus also undermining the Russian hegemony over the region's energy sources.

Given the current dynamics, TAPI enthusiasm appears misplaced and will remain a pipedream for a long while yet. There are three fundamental challenges that need to be addressed for transforming the TAPI into a viable energy alternative for energy-hungry South Asia and a mechanism for cementing greater regional cooperation.

First, much of the gas that the Dauletabad field in Turkmenistan, tipped to be the main source of supply, holds is already canalized to meet Russia's surging energy needs. Moreover, a project review in October 2005 by the Asian Development Bank which is financially backing the project, states, "Turkmenistan could supply enough gas for the first few years but then production is predicted to decline???they will need to find gas from other fields to meet pipeline design targets." The problem is compounded by the lack of independent estimates of Turkmenistan's gas reserves which skeptics argue are grossly overstated. Further, given the past record of erratic behavior displayed by the fickle-minded and autocratic regime in Ashgabat that has scrapped contracts, demanded a sudden and dramatic revision of agreed sale prices (which in the case of TAPI has begun even before the project has been implemented) only add to the list of woes. It also reflects the lack of any institutional mechanisms to uphold the sanctity of contracts and large scale financial investments.

The second serious challenge emanates from the deteriorating security environment in Afghanistan and Pakistan. The proposed route of the pipeline, through the city of Kandahar in South Afghanistan slices through the very nerve center of a brutal Taliban insurgency whose human, military, economic and psychological costs are mounting by the day. This region is also lavishly peppered with landmines making the task of laying a pipeline a high-risk enterprise. Moreover, the writ of the American-backed Karzai government barely extends beyond the confines of Kabul international forces are stretched to the hilt owing to the war in Iraq and also face growing domestic pressure to withdraw troops as casualties mount. Together these factors render any drastic alteration in the ground situation favorable to a project of such a scale highly unlikely.

In Pakistan, the pipeline is proposed to pass through the city of Quetta, capital of its troubled Balochistan province. Problems of severe political paralysis, economic recession, a resurgent Taliban with a particularly strong presence in the border regions with Afghanistan and strong separatist undercurrents in Baluchistan mean that the pipeline will be extremely vulnerable to attacks. Such concerns are reiterated by instances of serious sabotage of the Sui gas pipeline that runs from the region and pipes a large chunk of the gas to the domestic market in Punjab province. In spite of the recent thaw in Indo-Pak relations and recognition on both sides of the benefits that accrue from energy security in South Asia, security concerns remain given the sensitive nature and mutual suspicion that characterizes Indo-Pak ties. A purely military approach will not resolve the security dilemma unless supplemented by political and institutional mechanisms.

Third, in terms of topography the pipeline will have to negotiate rugged mountainous terrain in much of South Afghanistan while in the region around Quetta it will have to take into account challenges posed by frequent seismic activity. Thus, there are considerable engineering challenges that the project will have to grapple with apart from the other major concerns outlined above.

Overcoming these, especially the first two sets of challenges, will by no means be an easy task. If TAPI is to take the shape of a sustainable pipeline and not merely continue to linger on as an idea in the pipeline, certain fundamental issues need to be addressed. There is an urgent need to actively encourage state and nation-building exercises that could usher in political stability and economic credibility in some of the countries involved. This alone can provide a sound basis for any form of sustainable and meaningful engagement in the region.

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