On Sept. 11, 2024, Hassan Akhund, Prime Minister of the Taliban-led Afghan government and Gurbanguly Berdimuhamedov, Chairman of the People’s Council of Turkmenistan inaugurated the construction of the Afghan section of Turkmenistan-Afghanistan-Pakistan-India (TAPI) natural gas pipeline which had been stalled for over a decade due to security crises in the region.
The TAPI pipeline project, once completed, will cover 1,1814 kilometers, beginning from the Galkynysh Gas field in Turkmenistan, which is the world’s second-largest natural gas field. From Turkmenistan, the pipeline will traverse through Herat and Kandahar in Afghanistan, moving to Quetta and Multan in Pakistan and finally culminating at Fazilka, in India. The project is designed to supply 33 billion cubic meters (bcm) of natural gas annually. Of this, India and Pakistan will receive 14 bcm each while the remaining 5 bcm will be received by Afghanistan. The project is envisaged to meet participating states energy requirements, create employment opportunities and earn revenues through transit fees.
The TAPI pipeline could greatly assist Afghanistan by meeting its energy requirements and creating considerable economic prospects. It is anticipated to generate around 120,000 jobs, offering essential employment for a nation confronting a significant job crisis. Furthermore, it is estimated to generate between USD 450 million to 1 billion annually in transit fees for Afghanistan. The Taliban-led government, which has not yet received official international recognition, might bolster its reputation and facilitate future investments through the successful execution of this project. Moreover, Afghanistan’s strategic location as a conduit between South Asia and Central Asia establishes it as a pivotal participant in regional connectivity endeavours. This initiative will not only enhance cross-border trade and integration but also guarantee enduring economic advantages for Afghanistan.
Despite these benefits, the project has stalled over the years. The idea of the project goes back to 1990s when oil companies were interested in exploiting the natural gas resources of Central Asian states. However, the instability in the region led to the shelving of plans. In 2002, a new deal on the pipeline was signed by Turkmenistan, Afghanistan and Pakistan and in 2005, Asian Development Bank submitted its feasibility report. In 2008, India, Pakistan and Afghanistan signed an agreement to buy natural gas from Turkmenistan and finally in 2010, an intergovernmental agreement was signed in Ashgabat, Turkmenistan. This period was reflective of the high hopes generated by the democratic wave in the region that could steer countries towards regional cooperation bringing prosperity and stability, and the TAPI pipeline project was evidence of this fact. However, the project has been stalled because of various factors like, persistent instability in Afghanistan, fractious relations between India and Pakistan, Failure to reach an agreement on transition fee for gas passing through Afghanistan and Pakistan, lack of adequate funding, economic viability and logistic constraints.
The earlier estimated cost of TAPI pipeline was about USD 7.6 billion which has been raised to about USD 10 billion by recent estimates. The project is being coordinated by the Asian Development Bank and implemented by TAPI Pipeline Company Limited (TPCL)- Pipeline Consortium, in which Turkmengaz — a state-owned gas company of Turkmenistan has 85 percent stakes and the remaining three countries have 5 percent each.
The construction of the Turkmenistan section began in 2015 and was completed in 2019. The construction of Afghanistan segment couldn’t take off immediately after the completion of Turkmenistan because of the political instability in Afghanistan. In 2022, after coming to power, the Taliban regime assured the security of the TAPI Pipeline and announced a contingent of 30000 security personnel to guard the pipeline in Afghanistan. Finally, the construction on the Afghan segment of the Pipeline began in September 2024, however, no details were provided on financing and completion of the project.
Unlike India which has a wait-and-watch policy, Pakistan has shown keen interest in the Project. On June 8, 2023, Pakistan and Turkmenistan signed a joint plan to accelerate the implementation of the TAPI gas pipeline project, focusing on feasibility studies, land acquisition, and finalizing agreements.
Pakistan’s dependence on gas is significant, as nearly one-third of its gas is utilised for electricity generation. The TAPI pipeline will ensure a consistent supply of natural gas to Pakistan, thereby replacing the more expensive LPG which is presently in use. With this project, Pakistan hopes to stabilize the energy sector and reduce electricity prices, which have risen in recent years and prompted widespread protests.
Concerns for India
India’s “wait and watch” strategy towards the TAPI pipeline is partly due to its fragile relations with Pakistan. The diplomatic and trade relations between these two South Asian neighbours, both significant destinations for TAPI gas, remain severely fragmented. New Delhi is apprehensive that Islamabad may exploit the pipeline, which traverses Pakistani territory before arriving in India, as strategic leverage to impede gas supply during future confrontations. This geopolitical risk continues to be a substantial impediment to India’s active involvement in the project.
India harbours concerns regarding the security of the pipeline infrastructure in Afghanistan and Pakistan. In Pakistan, the pipeline will traverse the Balochistan area, which has had a notable increase in terrorist assaults recently. Although Afghanistan has offered security guarantees for the project, the ongoing presence of extremist organisations in the area remains a significant danger to its safety and stability.
Due to the decline in energy prices in recent years in the global energy market and its cheaper domestic natural gas production, India has sought to renegotiate the Gas Sale and Purchase Agreement (GSPA) signed by the four member countries in 2015.
Prospects for India
India, the third-largest global energy consumer following the United States and China, is also the fourth-largest importer of liquefied natural gas (LNG). The International Energy Agency’s “India Energy Outlook 2021” forecasts that the nation’s gas demand would quadruple by 2040. Due to constrained indigenous gas supplies, India presently depends on imports for approximately 50% of its gas needs. India has implemented a proactive strategy to diversify its energy import sources and shift towards cleaner energy. The TAPI pipeline fulfills these aims by ensuring a stable supply of natural gas and India’s pledge of net-zero emissions by 2070. It also addresses India’s apprehensions about energy delivery through precarious maritime chokepoints, where security is frequently jeopardised, as evidenced by the recent Red Sea crises.
South Asia is one of the least integrated areas globally, largely due to the enduring tensions between its two principal powers, India and Pakistan. Both nations have exhibited reluctance to interact bilaterally but have shown a degree of openness to cooperate at the international level. A recent instance is the visit of India’s External Affairs Minister to Pakistan for the Shanghai Cooperation Organisation (SCO) meeting. India ought to perceive the TAPI project as a multinational endeavour, separate from its bilateral conflicts. The effective execution of TAPI might act as a vital catalyst for promoting regional integration and collaboration, facilitating improved economic and diplomatic relations in South Asia.
Despite the perception of Pakistan taking strategic leverage by cutting supplies during the conflict, India should note that the multilateral character of the project will deter Pakistan in taking such actions which could hamper its status and risk future investment opportunities in the country. On the contrary, stabilised energy prices will act as a catalyst for domestic growth in Pakistan, indirectly benefitting India. India should use this project to build trust with Pakistan, and in the future, this could act as a catalyst for cooperation. As a major power, India needs to take a leadership position in the execution of the TAPI project, ensuring its economic feasibility for all involved nations. India’s active engagement may draw interest and investment from significant world powers, hence expediting the project’s completion.
[Photo by Allan Mustard, via Wikimedia Commons]
The views and opinions expressed in this article are those of the author.
Umer John is a PhD student at MMAJ Academy of International Studies, Jamia Millia Islamia, New Delhi, Specializing in India’s Energy Security. His research focuses on the diversification of India’s crude oil import sources and the strategic implications of global energy dynamics.
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