World Bank’s reluctance: Kabul seeks ‘trusted’ partner to complete CASA-1000

ISLAMABAD: Afghanistan has sought a trusted partner to complete remaining part of CASA-1000, as the World Bank is still unwilling to finance the project due to regime change in Afghanistan, well-informed sources told Business Recorder.

The Central Asia-South Asia power electricity transmission and trade project, commonly known as CASA-1000, is a $1.16 billion project currently under construction that will allow for the export of surplus hydroelectricity from Kyrgyzstan and Tajikistan to Afghanistan and finally to Pakistan.

Afghanistan’s Commer-cial Secretary has forwarded the letter of Da Afghanistan Brseshna Sherkat (DABS), seeking trustworthy partners of investment in CASA-1000 project.

The CASA-1000 project aims to facilitate electricity trade between Central Asian hydropower surplus countries and electricity deficient countries in South Asia.

The project involves constructing transmission infrastructure and establishing commercial and institutional arrangements for sustainable electricity trade. The four countries participating in the project Afghanistan, Kyrgyz Republic, Pakistan and Tajikistan - are of considerable geostrategic importance by virtue of their location at the crossroads of China, India, Russia and the Middle East.

The project’s implementation includes the construction of HVDC and HVAC transmission lines and converter stations.

The World Bank had financed the project in Afghanistan but postponed it due to the country’s current political situation. The remaining works require an investment of $ 90 million and once completed in 2024, the project is expected to generate annual revenue of up to $ 65 million through transit fee and recovery of funds.

According to Commercial Attaché of Afghanistan, there is investment opportunity available for interested investors to complete the remaining parts of the project in Afghanistan.

To maintain reliable transmission of power (over 1000MW) over long distance, power facilities including 500kV HVAC and HVDC transmission lines and Converter stations are under construction in all four CASA-1000 member countries. Key components of this construction program include: (i) two HVDC Converter Stations located at Sangtuda, (Tajikistan) and Nowshera(PK) that act as the link between the HVAC and HVDC sections of the project;(ii) a 789 km of HVDC transmission lines that connect the two converter stations across southern Tajikistan (101 km), northwest Afghanistan (575 km) and northeast Pakistan ( 113 km); and (iii) a total of 598 km of HVAC transmission lines running across Tajikistan (142 km) to connect to the CASA-1000 HVAC transmission lines in Kyrgyzstan (456 km) at the Tajik - Kyrgyz border.

The construction of the HVDC transmission line inside Afghanistan (from Sherkahn Bandar to Torkham), is divided into three LOTS. DABS had contracted the construction of LOT-l (198KM) with KALPATARU Power Transmission Ltd, and with KEC International Ltd for LOT2&3. The LOT-1 has overall 65% completion rate and LOT-2 and LOT-3 has overall 52% and 60% completion rates respectively.

The sources said CASA- 1000 project in Afghanistan was funded by the World Bank under grant number H927-AF till August 15, 2021. However, because of the current political situation in Afghanistan, the WB has suspended its funding commitment for the project in Afghanistan. The total cost of the Afghanistan packages amounted up to $300million of which $90million is required to complete the remaining works.

As per the signed Master Agreement and Power Purchase Agreement between the four member countries, upon completion of the project, expected in 2024, the DABS will receive up to $65 million through transit fee and recovery funds each year.

The government of Afghanistan and DABS are seeking partners to complete the remaining the project. The investment partnership would be negotiated and agreed upon with the interested investors.

Copyright Business Recorder, 2023