Pakistani Stream: Russia Goes South – Just Beginning

Sergey Savchuk

The foreign press reports that Russia continues to work to build up its strategic presence in key points on the world map. In this case, we are not talking about the army and the navy. It is about energy and specifically about the “Pakistani Stream”.The other day in Islamabad, a bilateral meeting ended, at which groups of technical specialists from both countries confirmed their readiness to implement the project, for which the development and coordination of technical issues and documentation will continue. The main difference from the memorandums of previous meetings is that geological exploration will begin along the route of the potential gas pipeline. That is, the future pipe makes its first step from paper to the ground.

Initially, the idea of ​​the project arose at a difficult time. In 2015, an intergovernmental agreement was signed on the development and construction of the North-South gas pipeline. With a length of almost 1,100 kilometers and a cost of about $ 2 billion. The implication was that Russian contractors would build a transit line from the port of Karachi to the city of Lahore. The peculiarity of the technical idea was that it was necessary to additionally build a regasification terminal in the port. There LNG would be delivered using sea LNG carriers. After being transferred back to a volatile state, it would go strictly north to the Punjab province.

For the next two years, the project moved very slowly. The parties could not agree on the size of tariffs for pumping gas. It is noteworthy that Russia demanded an increase in cost, otherwise the project was economically unprofitable. Then the next US sanctions were imposed on the Rostec corporation, the key executor on the part of Russia. That further impeded the implementation. 

Renaming the project – Pakistani Stream

Last fall, the parties revised the terms of the agreement again. This time exclusively at the request of Islamabad. The share of Pakistan’s participation in the project has grown from 51 to 74 percent. The condition of attracting and using only Russian materials, components and equipment is strictly stipulated. It was decided that Russia’s investment will not exceed 25 percent. Pakistan will cover all other costs. In the spring of this year, the project was renamed “Pakistani Stream”. The energy ministers of both countries announced their readiness to start construction in the very near future.

Pakistan is a country with a population of over 220 million. If you mark on tracing paper the location of all Pakistan’s power plants, and then superimpose this tracing paper on a physical map of the country, a critical imbalance will be visible to the naked eye. 20 stations operating on oil products. 22 thermal power plants operating on natural gas. Nine coal and three nuclear power plants. Pakistan needs light in the homes of its citizens and reliable sources of energy.

The implementation of the “Pakistani Stream” with a capacity of 12.4 billion cubic meters of gas per year will provide fuel for new power plants. That, in turn, will feed industrial enterprises concentrated in Punjab, on the border with India. If the project turns out to be successful, nothing prevents the gas pipeline from being extended to the capital. The transport shoulder from the city of Multan to Islamabad is just over four hundred kilometers.

Possible avalanche of global transformation

There is not the slightest doubt that the revitalization of the region is connected both with the political changes in Afghanistan and with the completion of the construction of Nord Stream 2. Russia has clearly shown that it is capable of completing any projects, even under the pressure of massive sanctions. India is striving to become the main metallurgical power in the world It simultaneously needs the iron ore of Afghanistan, coking coal and blue fuel from Russia. Pakistan wants to reach a new level of industrial development. This again requires natural gas, and all neighboring countries themselves are experiencing a deficit in it and clearly do not intend to share it with Islamabad. 

Afghanistan, in principle, is ready to absorb any amount of resources, since the electrification of the country, thanks to the incessant war, is at a medieval level.The American withdrawal from Afghanistan was the stone that moved an avalanche of global transformation. If the Taliban manage to keep the country from another all-out war of all against all, then in the very near future we will witness a battle for new energy, trade and industrial markets.

Russia & Pakistan agree to build gas pipeline from Karachi to Lahore

Russia has signed a deal with Pakistan to build a major gas pipeline linking the nation’s southern port of Karachi to industrial hubs in the north. The deal is set to be the biggest between Moscow and Islamabad since the 1970s.

Russia’s Energy Minister Nikolay Shulginov and the Pakistani Ambassador, Shafqat Ali Khan, signed a revised agreement on the project in Moscow on Friday, opening the way for the start of construction in the near future.

Spanning more than 1,100 kilometers, the pipeline dubbed the ‘Pakistan Stream’ is expected to have a discharge capacity of up to 12.3 billion cubic meters of natural gas per year, according to the Energy Ministry’s statement.

The pipeline would connect liquefied natural gas terminals in Karachi and another port city, Gwadar, with power plants and industrial hubs in Pakistan’s northern region of Punjab, which includes the city of Lahore.

Both nations “put a major effort” in preparing the amendments to the deal. The signing of the agreement would allow them to begin construction “as soon as possible.” The deal would “help Pakistan strengthen its energy security and increase its reliance on natural gas as an eco-friendly energy source.” 

Last year, a Pakistan official told Bloomberg that the construction could start as early as June. However, officials in Russia have not confirmed this information yet. The project, which has an estimated cost of $2.25 billion according to the Pakistani media, would involve the establishment of a Special Purpose Vehicle (SPV) company operated jointly by Pakistan’s Inter State Gas Systems and several Russian firms, including the TMK – a company that is one of the world’s leading steel pipe suppliers for the oil and gas industry, doing business in Russia, the US and Canada, among other nations.

Under the agreement, Pakistan would reportedly own 74% of the stakes in the pipeline operator while Russia would have the remaining 26%. The initial agreement on the pipeline construction was signed back in 2015 but it was then reviewed.

The project is set to become the biggest infrastructure deal between Pakistan and Russia since at least the early 1970s, when the Soviet Union built the Pakistan Steel Mills industrial complex at Port Qasim, near Karachi.

“The Pakistan Stream remains a flagship project in bilateral cooperation between Russia and Pakistan and both nations give priority to this issue,” Shulginov said.

Oil tankers park in a terminal at a port in the Pakistani city of Karachi

Karzai warns Afghans and neighbors to resist ‘US agenda’

Karzai is confident that Afghans and regional stakeholders support his crusade against the “American agenda” in Afghanistan, which he describes as an attempt to create disharmony among nations

 

Three years since he left office, the presence of former president Hamid Karzai still lingers in the corridors of Afghan politics. The fact that he continues to live on the same street as the presidential palace also ensures that he remains keenly involved in matters of a nation at war.

It is at this humble but traditional home in Kabul that Karzai extends the courtesy of his hospitality to scores of Afghan leaders, ministers, tribal elders and international diplomats, on a daily basis. He meets with hundreds of local and international stakeholders, making peace and relationships that can influence the turn of regional events in Afghanistan’s favor, a country that he helped put back together with the help of US allies after the fall of the extremist Taliban regime in 2001.

However, today, Karzai is among the few prominent Afghan voices against the occupying US forces. He has strongly condemned the new Afghan strategy put forth by US President Donald Trump in late August. “The neighborhood is no longer an ally of the US in their war against terror,” he told us on a warm September afternoon at his residence in the capital.

Karzai is confident that not only Afghans but also regional stakeholders support his crusade against the “American agenda” in Afghanistan, which he describes as an attempt to create disharmony among nations in the region, such as India, Pakistan, Iran and China.

“If they genuinely want to fight extremism and terrorism, they cannot do it by creating rivalry here in this region. They cannot take one ally and create rivalries — that’s adding to the conflicts in Afghanistan,” he said, referring to Trump’s statement calling out Pakistan for harboring insurgents, while encouraging India to play a bigger role in Afghanistan.

However, this is not to say that Karzai doesn’t value international powers trying to foster peace in his country. On September 4, leaders of the five BRICS nations — Brazil, Russia, India, China and South Africa — called on Pakistan to end terrorism in Afghanistan and the region following Trump’s statement. 

Move to name terror groups was ‘important’

“BRICS was an important development,” Karzai said, hailing the statement by BRICS nations on terrorism emanating from Pakistan as a “significant development.”

“Naming terrorist organizations at BRICS was important for the countries that are really affected, like India, China and Russia. This is what we need — cooperating in this region against extremism and terrorism. Not the imaginations of the US played out in our region.”

Karzai dismissed Pakistan’s defensive reaction to the BRICS statement, saying that Islamabad lays some of the blame on Kabul. “Nobody believes Pakistan’s [excuse] blaming Afghanistan for providing terrorist sanctuaries,” he said.

“They know Afghanistan is not involved in that or has the capacity to do things like that. They must deal with this and not us,” he added, urging Pakistan to give up extremism. “We want Pakistan to recognize that playing with extremism is never going to help them.”

While Karzai remains critical of Pakistan’s role in regional security, he is also suspicious of Washington’s intention in condemning Pakistan. “President Trump’s strategy makes it look like [there are proxy wars in Afghanistan] and we don’t want that. We don’t want Afghanistan to become a battleground for rivalries, or a place where proxies fight,” he explained.

As the conversation moved more towards regional politics, Karzai expressed appreciation of India’s role in the development of Afghanistan. Karzai’s relationship with India goes a long way back – to his days as a student in Himachal Pradesh, evidence of which can be seen in his library, which boasts of a copy of the Indian constitution, which he has read and referred to several times during his years as leader of a new nation.

Karzai urged India to not be swayed by Trump’s policies. “My advice to India is that it should have its independent policy towards Afghanistan and not be influenced by Americans,” he said. “India should not ally itself with America’s objectives in Afghanistan because those objectives are not good for this region. They are surely not going to be good for India eventually.”

Having presided over the new Afghanistan for more than a decade, Karzai is no stranger to the consequences of proxy wars. “These rivalries will be played out in Afghanistan. Why should we be the ground where larger powers with their own interests create a war in which we die?” he said, noting the drastic increase in civilian casualties over the last two years.

‘India never interfered in our ties with Pakistan’

The former leader also dismissed talk of an India-Pakistan proxy war being played out in his homeland.

“During my government, India never interfered with our relationship with Pakistan,” he revealed, adding that Indian leaders Manmohan Singh and Narendra Modi had both been considerate about Afghanistan’s sensitive position in the region.

“We spoke about these issues with India and at one point they even refrained from helping Afghanistan militarily because they said Pakistan may get irritated,” he recalled. “They were trying to avoid too much irritation for Pakistan; that’s what Prime Minister Manmohan Singh told me.”

Despite this, Pakistan still appears to be concerned about Afghanistan’s growing affinity to India. “Pakistan, of course, constantly kept talking about India, [and it] especially has issues with the number of Indian consulates in Afghanistan,” he revealed.

As Karzai bid us farewell, he repeated his warning. “Tell India to not fall for the strategic games that the US is playing in this region. We want an Afghanistan-India relationship that is not impacted by the strategic interests of another power [that is well] away from us.”

Source: http://www.atimes.com/article/karzai-warns-afghans-neighbors-resist-us-agenda/?utm_source=The+Daily+Brief&utm_campaign=da61e3311e-EMAIL_CAMPAIGN_2017_10_12&utm_medium=email&utm_term=0_1f8bca137f-da61e3311e-21552319