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Economy 07/11/2007 Central Asia power project to link four countries
Four countries are expected to give the green light this month to a project that would lead to the first significant electricity transfer from central Asia and help resolve seasonal power shortages in Pakistan and Afghanistan, Financial Times reported.

If approved, the main beneficiary is set to be Pakistan, whose fast-growing economy is being reined in by a power generation deficit of about 1,500MW.

The four-country plan foresees the building of about 1,100 kilometres of new transmission lines from Kyrgyzstan and Tajikistan to Pakistan via Afghanistan.

Representatives from the four countries are due to meet in Kabul on November 16 to sign a preliminary agreement. The governments are expected to contribute some financing, but the bulk of the money will come from multilateral organisations.

Raghuveer Sharma, who leads the World Bank’s energy programme for central Asia, forecast that construction could start in "a year to 15 months", and be completed between 2010 and 2012. In an initial phase, adding the lines would cost about Dollars 500m and would serve to transfer about 1,000MW of additional electricity to Pakistan. But he said that eventually the flow could be quadrupled if as much as Dollars 5bn of mooted hydroelectric projects in central Asia are given the go-ahead.

Central Asia uses all its electricity in the winter but is left with a power surplus in the summer months, which could be exported as the timing coincides with peak demand in hotter regions further south.

Officials said the project should be seen as a big step towards greater economic integration in the region. The new transmission network would mark a significant departure from inefficient Soviet-era energy allocation arrangements in central Asia that have saddled the region with a power grid controlled out of Uzbekistan.

Sean O’Sullivan, a senior infrastructure official at the Asian Development Bank, said: "This is really a big opportunity to make much better use of everybody’s resources and move towards a new central and south Asian electricity market."

The main transmission route will serve Pakistan directly because of the high cost of building a connecting branch to Afghanistan, the transit country.

However, to avoid political tensions and help electricity-starved Afghanistan, the project foresees the construction of a smaller, independent set of transmission lines between Tajikistan and Afghanistan.

Separately, Afghanistan is also working on adding 300MW of power from a new transmission route from Uzbekistan.

Anwar-ul-Haq Ahady, the Afghan finance minister, said the transmission lines should be completed by next summer. However, he admitted that the two countries still needed to agree on the cost of the power transfer. "We have agreed on the principle but the price is yet to be determined," he said.

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