CASA project and energy dynamics across Central, South Asia

Having similar objectives as the CPEC and the TAPI, the CASA-1000 happens to be the third most significant, groundbreaking project of the decade for this geopolitical region.

Officially declared a project in 2015, the progress of the Central Asia South Asia Electricity Transmission and Trade Project (CASA-1000) has been at a snail’s pace until only recently.

Launched in 2016, it involves four countries, namely, Tajikistan, Kyrgyzstan, Afghanistan and Pakistan and most of the funding is arranged from the World Bank, while the Islamic Development Bank (IDB) and the European Bank for Reconstruction and Development (EBRD) are also funding it partially.

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In the broader perspective, this ambitious scheme intertwines two separate geopolitical regions with one single project. Connecting the energy-rich Central Asian states with the massive consumer market of South Asia, both US-backed projects of CASA 1,000 and the Turkmenistan-Afghanistan-Pakistan-India pipeline (TAPI) promote regional integration as well as facilitate economic connections and multi-lateral co-operation.

With an initial budget of $1.17 billion, the CASA-1000 also happens to be the third most significant, ground-breaking project of the decade in this geopolitical region, after the two bigger projects that are the China-Pakistan Economic Corridor and the Turkmenistan-Afghanistan-Pakistan-India pipeline.

Hydropower dams running on water cascading from mountain ranges, such an electricity transmission line connecting Central Asia to Afghanistan, Pakistan and maybe even India can uplift the entire region

Sabena Siddiqui

Under-rated

Unfortunately, CASA-1000 has been quite under-rated and is not as well-known as the other two projects due to perpetual delays which create confusions whether the project is still on. Nevertheless, since TAPI was inaugurated in March this year, there is new hope that the CASA 1000 could also move ahead as it is in the same region.

Announcing plans to start building the required infrastructure, the Tajikistan Ministry of Energy and Water Resources has said that, “The implementation of the physical part of the CASA-1000 Project will begin in all countries participating in the Project during this year.”

Assessing the overall impact of this project the following main factors emerge; Firstly, it helps utilize the excess from hydropower plants in Central Asia in summers. Harnessing the surplus of clean energy produced by the republics of Tajikistan and Kyrgyzstan, it makes economic sense for these states to utilize their abundant water resources for generating electricity that can be exported.

Hydropower dams running on water cascading from the mountain ranges, such an electricity transmission line connecting Central Asia to Afghanistan, Pakistan and maybe even onwards to India can uplift the entire region.

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Secondly, it helps establish Afghanistan’s viability as a stable and dependable transit route for supplies. In the construction phase, this large-scale power project is to be stretched 550km across the length of Afghanistan from the Sher Khan Bandar at the Afghan-Tajikistan border to the Torkham border check-point at the Afghan-Pakistan border.

Projected to be completed in 2020 now, most of this construction is to happen in early 2019 and it should reach the commercial operation phase in late summer 2021, according to the World Bank.

Thirdly, it helps to reduce Pakistan’s energy crisis, which virtually knocks off 3% percent of its economic growth every year. Providing Pakistan financing of around $120 million, the World Bank is facilitating Pakistan in laying the power transmission lines for its part of the project while the US played a prominent role in striking the power supply deal between Pakistan and Tajikistan.

Conducting the feasibility research, Canadian company SNC Lavalin has endorsed the viability of the CASA-1000 project. Finalizing modalities, the construction tender was won by two Indian companies in March 2018, and work is to begin with the installation of transmission lines.

Project agreements

To be executed in three phases, all the main project agreements and procurement detail for infrastructure packages have also been settled between the four participants.

Once completed successfully, it can be a virtual stepping-stone for the establishment of the CASA Regional Energy Market initiative (CASAREM) which aims to enhance the growth prospects of both Central Asia and South Asia with clean power export revenues and alleviating an energy deficit.

Beginning with two Central Asian countries as exporters and two South Asian ones as importers, Afghanistan receives 300 megawatts of power according to its domestic demand, while the remaining 1000 megawatts would be transited to Pakistan via Afghan land routes.

Standing to benefit $50 million annually just in transit duty, this is a litmus test for Afghanistan. If it proves to be a successful model there is great potential for more South Asian countries to join in and access reliable energy supply lines from Central Asia.

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Defining the long-term vision of the project, Lilia Burunciuc, World Bank Regional Director for South Asia has said that, “CASA 1000 is a key part of the broader effort to develop a regional electricity market linking Central Asia with the broader region and is also promoting energy security and economic development in the four countries part of the project.”

Connecting states and regions, the idea for this 1200 km, 1300MW link is originally on the pattern of the North American grid that covers a 340,000 km area or even the European power network which spans across 230,000 km of territory.

Enabling inter-regional electricity trade, the CASA-1000 can economically uplift some of the poorest regions as well as bring in more infrastructure investment. Not only that, the development plan enhances the energy security of South Asia and upgrades regional stability. 
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Sabena Siddiqui is a foreign affairs journalist and geopolitical analyst with special focus on the Belt and Road Initiative, CPEC and South Asia. She tweets @sabena_siddiqi.

Last Update: Thursday, 8 November 2018 KSA 20:38 - GMT 17:38

Disclaimer: Views expressed by writers in this section are their own an