IPRI :: Islamabad Policy Research Institute

Central Asia, comprising Kazakhstan, Tajikistan, Turkmenistan, Kyrgyzstan, Uzbekistan, and the energy-rich lake called the Caspian Sea, owes its significance to its vast economic potential and its geo-strategic location In the era leading to the break-up of the Soviet Union, several energy-starved countries realized the indispensability of the region to their economic wellbeing. Its economic potential and strategically important location, combined with recent seismic political events, have brought the region centre-stage in the global political scenario. Its political and economic legacies collided with the emerging realities of the post-Cold War transitional period, resulting in conflicts, instability, political turmoil, and a host of multifaceted challenges. At the same time, the proven natural resource potential of the region means unprecedented opportunities, which it can exploit to its own benefit.

The enormous hydrocarbon reserves of the region have tempted both neighbouring and distant nations to plunge into the game of treasure hunt. Each player is endeavouring to outplay the other. Russia, the USA, Iran, Turkey, India, etc., are intent upon gaining a foothold in the region. On the one hand, the Central Asian states need to establish their identity, redefine their political standing in international relations, and chalk out their national strategies to tackle their problems through economic development; on the other hand, the world’s well-established nations are all set to exploit the compulsions of these fledgling states to their own political and economic advantage.

Pakistan is situated at the interface of Central Asia and South Asia and provides these landlocked states with the shortest route to the Arabian Sea. The CAS are in need of economically viable and cost-effective transit and pipeline routes. Policymakers in Pakistan are therefore seeking to make the best possible use of this opportunity by establishing strong links with the region.

The aim of this research project is to present a comprehensive analysis of the evolving dynamics of Central Asia, in an endeavour to understand the scope of the potential benefits it offers to Pakistan. Accordingly, it will incorporate recommendations that could help Pakistan to secure its interests in Central Asia to the maximum extent possible.

Evident in the history of the Central Asian states is the impact of pre-Islamic Iranian civilization, Islam, the Turks, the Mongols, and, finally, the Russian empire. All of them influenced the region greatly, adapting it to their respective requirements. The seventy years of Soviet Communist rule added yet another layer of influence, changing–but not obliterating–the legacies of the past.[1] Even today, Central Asia retains its place, on the boundary of different regions and cultures, combining, without amalgamating, influences from the civilizations that surround it.

The recorded history of the region reveals the prominent role Central Asia played in the past. Its antiquity is established by archaeological findings that date back 100,000 years. Now, once again, the area has become the focus of attention of the contemporary world.

This paper will briefly discuss the history of Central Asia before and after Islam. It also describes the historical relations of the region with the region now called Pakistan. Before recommending any suitable course of action for Pakistan and the Central Asian states for reviving and consolidating age-old ties, it seems appropriate to examine those relations in the historical context.

In 330 BC, Alexander the Great conquered Central Asia.[2] After his death in 323 BC, his empire disintegrated, but its different components continued to retain their political and economic connections with the parent country, and Greek colonists, merchants, and travellers continued to exert considerable influence in the spread of Greek civilization. In 159-139 BC, the Scythians conquered the major towns and strongholds of the Graeco-Bactrian kingdom. For the next one hundred years, the Scythians and the Parthians controlled most of Central Asia. In the first century AD, a union of nomadic tribes was formed under the rule of the Kushan tribe; they succeeded in defeating the Scythians and Parthians.

At the peak of their power, the Kushans ruled Bactria, eastern Turkestan, Afghanistan, and part of present-day Pakistan. The Kushans were not particularly interested in introducing civil skills, since they were nomads and warriors by nature. At the end of the second century AD, Kushan power began to decline. There were several other ethnic groups ready to fill the power vacuum. However, it took almost 250 years for Kushan rule to disappears completely. The prominent religions during that time were Buddhism, Zoroastrianism, Manichaeism, and Christianity. In the second century, Christian missionaries spread the message of Christ in Central Asia, then travelling along the trade routes to the Chinese coastline.[3]

Finally, in the mid-fifth century BC, another nomad tribe, the Ephtalites, whose origins lay in the White Huns, subjugated Bactria and sealed the fate of Kushan rule in Central Asia. The White Huns, although basically warriors, are credited with the introduction of civil skills and intellectual pursuits. An early decline in their power saw the loss of their territories to the attacks of Turkic tribes and their empire began to fall to pieces during the sixth decade of the seventh century.

Just a few years after the passing away of the Prophet Muhammad (pbuh) Muslim armies rolled through Persia (Iran) in AD 642 to establish a military base at Merv. In the seventh and eighth centuries the Arabs invaded Central Asia. In the following centuries, there were large-scale conversions to Islam under the influence of the Muslim mystics who wandered across Asia.[4]

In the beginning, the Muslim Arabs were interested only in conquering the fertile valleys of the Amu Darya. They also conquered the towns of Bukhara and Ferghana, and in AD 714, they seized Samarkand. The middle of the eighth century witnessed complete Muslim control established over Central Asia, with Khwarezm and Bukhara becoming important centres of power for the Caliphate. This development also saw the migration of thousands of Arabs to the fertile lands of Turkestan; however, most of the migrants were traders, officials, soldiers, and some farmers. The Caliphate preferred to let the native people rule the land.[5]

In the Central Asian region, Islam appealed first to the elite; later, the masses also converted, and in ever-increasing numbers. As the Muslims who settled in Central Asia were mainly traders, trade among Arabs and Central Asians flourished under the former’s rule. The arrival and departure of trade caravans became a common sight in the big towns of the region. Agriculture also benefited through the regular inflow of expertise from China and the Indus valley–the area now comprising Pakistan.[6]

Sultan Mahmud Ghaznavi came to power in Central Asia and Afghanistan in AD 1997; he invaded the subcontinent seventeen times. After him, various Turkish rulers invaded India including Shahabuddin Ghauri, Timur, and Zaheeruddin Babar. All these invaders left indelible marks on the social and cultural traditions of South Asia. The synthesis of cultures established strong ties among the peoples of both regions. The earlier Central Asian invaders were the Aryans. They invaded Moenjodaro and Harappa, ancient centres of civilizations in what is now Pakistan. Their elites later established the caste system in the subcontinent and called themselves Brahmins, meaning ‘son of god’. Maharaja Chandragupta Maurya, Maharaja Ashoka, and Prithvi Raj were some of the famous non-Muslim Aryans who ruled the subcontinent before the arrival of Muslim Aryans from Central Asia (called Turkestan at that time). Great Muslim sufis such as Hazrat Data Gunj Bakhsh, Hazrat Yaqub Zanjani, Hazrat Shahbaz Qalandar, Hazrat Mian Meer, Hazrat Nizamuddin Auliya, Hazrat Bahauddin Zakriya, and Hazrat Barri Imam, all came from Central Asia to preach Islam in the subcontinent.[7] A very brief overview of these historical relations is given below.

In the thirteenth century, various Central Asian states, and China, came closer to each other due to Mongol rule. The Gakkars of Punjab and the Sammas of Sindh established friendly relations with Central Asia. Caravans moved freely between Samarkand, Multan, and Lahore. It was not just merchandise that crossed borders but also men of learning and those imbued with spiritual missions, breaking geographical barriers, mixing with the people to teach them lessons of love, brotherhood, and fellow-feeling.

The successor states of the Shaibanids in Bukhara, the Safavids in Iran, the Mughals in India, and the Mings in China were the end-products of this systematic process. Commercial enterprise took new shape: silk, carpets, rugs, brocades, jade stet and other precious stones, books, manuscripts, painted designs, scrolls, silver and copper wares, gold, porcelain and leather goods, and several other items of trade passed from Central Asia to the area that today forms Pakistan. Roads and caravan inns (caravanserais) were built, as were stepped wells, mosques, and kos minars (kos being a measure of distance, so milestones); shady trees were planted along the roads. The Khyber Pass was opened during the Mughal period, and a road was built through it. Thatta, Multan, Lahore, and Peshawar became the industrial and commercial centres of the region. Peshawar was an important centre of economic activity for the transit of goods and men, including missionaries, flowing in both directions between Central Asia and today’s Pakistan. Many serais were built in this city. In fact, Peshawar became a great emporium of Central Asian trade and its Hindko language became the lingua franca for this international commerce.

As a result, Turkish culture influenced the area, to which many buildings that still stand today bear testimony. Various kinds of agricultural products were exchanged between the two regions. Lift irrigation system became popular; water was carried to houses through copper conduits; the Turkish system of bathrooms was introduced. But most importantly, calligraphers, printers, builders, and men of learning travelled freely through these countries. These contacts and exchanges knit these regions into one civilizational unit, where not only did a common market provide business facilities but common cultural goals also prevailed.[8] Even the eating habits of Pakistanis have been influenced by Central Asians; for instance, pulao and spices came from Central Asia. This process of cultural enrichment was abruptly curtailed with the end of the Mughal empire and the establishment of British rule in South Asia and Tzarist Russian and Soviet rule in Central Asia. However, the linkages were so deep and strong that the feeling of affinity between the peoples of the two regions could not be extinguished despite the passage of time and the suppressive efforts of the colonial powers.[9]

Now, having gained independence, both regions can build their relations on the basis of the historical, cultural, and economic links, rooted in the ancient and medieval past.

Central Asia is rich in natural resources, such as oil, gas, and minerals. It also possesses a considerable reservoir of fairly literate and skilled manpower. The region is expected to play a key role in Asian and global geopolitics and geo-economics in the decades to come.

Since independence, all the five Central Asian states have been striving to find their rightful place in the region’s political and economic configuration. Their efforts are mostly directed towards shaping statehood under new circumstances, and becoming active members of the world community.[10] The following discussion attempts an understanding of the potential of the CAS in various fields.

Central Asia mainly has a two-fold economic significance:[11] The region’s population is 55 million, which represents a sizeable consumer market. It also has oil and gas reserves, estimated at 23 billion tons of oil and 3,000 billion cubic metres of gas.

The area comprising the Central Asian states, along with its historical regional partners, can emerge as one of the most powerful economic centres in the world. The tapping of other natural resources such as fertile land, abundant water for irrigation, and rich mineral reserves will benefit all mankind. Vast deposits of gold, silver, chromium, uranium, and the hydel power potential need to be explored, with a well-defined development strategy that will boost the economic rehabilitation of the CAS, while benefiting co-operating nations.

The region is at the crossroads between Asia, Europe, the Persian Gulf, the Middle East, and the Far East, and will undoubtedly gain considerable importance in European and Asian economies.

During the Soviet era, the Central Asian republics were treated principally as a source for raw materials for the capital and consumer goods industries of those republics of the USSR located in Western Russia and the Urals. However, despite the ruthless exploitation during the Soviet era, the region’s resources appear, for the present, inexhaustible.[12]

The Central Asian states and the Soviet Union had strong economic ties, with the former mainly dependent on the latter for their economic stability, as they used to receive subsidies to the extent of 40 per cent from the former USSR to support their budgets.[13] Now they are dependent on Russia, the successor to the Soviet Union, for trade and the flow of oil and gas.

Economic transition in Central Asia has brought in its wake dislocation and chaos. The CAS are attempting to pursue a ‘strategy of transition to mixed economy’. They are welcoming foreign investment and are opening up their economies.[14] In the present-day scenario, to improve the economies of the regional states, there should be a well-knit system of mutual exchange and exploitation of resources.[15]

Tajikistan, Kyrgyzstan, and Turkmenistan have an abundance of hydrocarbon energy reserves which they can export to neighbouring nations. For example, Pakistan can import up to 10,000 MW of hydel power from Tajikistan and Krygyzstan, thus doubling the existing power supply in the country.

Pakistan also can play a role in boosting the Central Asian economies by providing cost-effective land routes; in the process, its own economy will benefit greatly. It can serve as a strategic bridge, linking the CAS with the Southeast Asian ‘tigers’ and Japan. At the same time, as the Central Asian countries seek economic diversification, a unique opportunity has emerged for Pakistan to export goods, establish new industries, and thereby play a strategic role in bringing about structural change in the Central Asian economies.

The Central Asian states have a combined land area of nearly four million square kilometres (1,544,400 sq. miles). This vast area is centrally situated between the eastern and the western, as well as the northern and the southern parts of the Eurasian landmass.[16] The region also derives its strategic significance from the fact that it borders two of the five permanent members of the United Nations Security Council – China and Russia. Through China, Iran, and Pakistan, it has access to the Pacific coast, the Persian Gulf, and the Indian Ocean, respectively. The CAS are developing their basic infrastructure and establishing road and rail links with neighbouring states. With the completion of communication systems, i.e., roads, railways, airports, and seaports, the geo-strategic and economic significance of Central Asia will be further enhanced.[17]

The economic significance of the region has added to its geo-strategic importance. The Central Asian republics have joined several regional and international organizations, such as the Shanghai Co-operation Organization, Conference of Interaction and Confidence-Building in Asia, Economic Co-operation Organization, Commonwealth of Independent States (CIS), Conference on Collective Security, etc., to improve their defences and economies and to utilize their resources to the maximum. Once intra-regional communication links have been established in the region, it will be able to play a more effective role in strategic terms. It has the potential to become the energy nerve centre of the world. In this context, too, stability and peace in the region will be in the interest of all world powers.

Krygyzstan,[20] Turkmenistan,[21] and Tajikistan[22]–are undergoing a process of fundamental change and transition. Recent military-strategic developments are an integral part of this overall transition. It is clear that the future of the national armed forces and the shape of military-strategic relations in Central Asia will be fashioned primarily by general political developments in this region. Security links with Russia as well as Russian strategy toward the region will also remain at the heart of the regional military-strategic agenda for many years to come.[23]

At present, the Central Asian states are just beginning the process of raising their own armies and developing their own strategies and military doctrines, keeping in view their threat perceptions. At this stage, it is important not to restrict a regional military-strategic analysis to a purely military framework (military balance, troop deployment, etc.), but also to link it to the emerging trends in the domestic and regional politics of the Central Asian states.

The Collective Security Treaty was signed at the fourth CIS summit in Tashkent in May 1992. It provides an important multilateral umbrella for military co-operation between the signatory states and legitimizes Russia’s military-strategic commitment to each of the participants. In fact, it serves as a general cover for a genuine co-coordinating mechanism that could function on a bilateral level and secure Russia’s role as a security guarantor for the other signatory countries. Moreover, the agreement provides Russia with an important mechanism, allowing it to wield significant influence over the military development and activities of the Central Asian states, while helping to preserve old links and channels for the supply of weapons, military hardware, and spare parts to these republics.[24]

The overall picture of military co-operation among the Central Asian states is complicated by a lack of clarity regarding the interrelation and interaction of different forms and structures of such co-operation, bilateral agreements, Commonwealth (CIS) agreements, the Tashkent Treaty, and similar agreements signed by only a few CIS members. The concept of CIS military security was originally designed as a ‘collective defence’ for all eleven CIS members. Consequently, the emerging command and control structures of the CIS Joint Armed Forces (JAF)–High Command, Council of Defence Ministers, and others–were to incorporate all eleven CIS members, not all of which sought close multilateral military co-operation. Similarly, Central Asian armies need some time to train their own officers, to create their own military colleges and centres, to sort out questions of military supplies, to develop national symbols and loyalty, and to cultivate their own culture of military-civilian relations.[25]

A declaration by member-states of the Collective Security Agreement was adopted in February 1995 at a CIS summit. This concept, which of course was not meant to apply to the Central Asian region only (and Turkmenistan has not signed the original collective security agreement), defines major sources of military threats and factors which might contribute to military dangers, evolving into a direct military threat,[26] as the build-up of military capabilities in neighbouring CIS states can disturb the existing balance of forces.

However, a significant handicap for the Central Asian member states of the CIS is the fact that their armed forces are still in the initial formation stage. They are the fragmented, collapsed armed forces of the former Soviet Union and therefore do not yet have a single internal system which includes command, control, and communications (C 3), a comprehensive supply system, mobilization readiness, the training of personnel, and defence production. Despite this, since independence, the Central Asian states have determined the general structure of their armed forces. Command and control bodies, military doctrines and military policies as a whole are being worked out.[27] Their military capabilities are limited. As witnessed in the case of the civil war in Tajikistan, even for internal security Central Asian states have had to depend upon the Russian military.29

Since independence, the Central Asian states have enjoyed considerable development and have become a significant force in international politics. Moreover, Central Asia, situated at the centre of the Eurasian continent, is the linking point of East and West. Besides, with its oil and gas wealth, it is likely to become one of the most important energy export bases of the world in this century. This advantage in the geo-polinomical[28] field will surely attract more and more countries to compete for investment and development in this region.

The oil and gas reserves of the Caucasus and Central Asia are vital for world’s geo-strategic and economic interests. They have the potential to usher in prosperity and economic growth, especially due to the low oil prices. In addition, these resources are the key to ensuring revenues, and with them, the sovereignty of the countries in the region. Besides, the wealth brought in by oil may fuel not only economic but also democratic development.

Recent history tells us that ‘oil is a commodity as well as politics’.[29] Energy resources play an extremely important role as strategic drivers for the rest of the world. The Caspian region contains approximately 90 billion to 200 billion barrels of oil, and about 46 per cent of the world gas resources. The oil reserves might prove to be the third largest in the world, after western Siberia and the Persian Gulf; with prospecting and development within the next 15 to 20 years, they might turn out to be large enough to replace the Gulf for second place. Apart from the Caspian, the five former Soviet Central Asian republics hold nearly four per cent of the world’s natural gas reserves, and both Uzbekistan and Turkmenistan are already major natural gas producers. There are two types of oil and gas resources:

The presence of these resources has been verified by different groups and multinational companies. This term has been defined in the oil business as the quantity of oil, which can be produced profitably, given current prices and technology. These resources are available in the northern part of the Caspian Sea.

These reserves are only on estimated list of state and oil companies. The presence of these resources has not been verified yet, but they are estimated at about 200 billion barrels.[30]

In the year 2000, Uzbekistan produced 1.99 trillion cubic feet (tcf) of natural gas, followed closely by Turkmenistan, with 1.64 trillion tcf. Although it produced only 314.3 billion cubic feet (bcf) of natural gas in 2000, Kazakhstan has considerable proven reserves, and the possible reserves in its Caspian Sea sector could make Kazakhstan a major producer of natural gas in the coming years. Turkmenistan’s Karakum Desert holds three trillion cubic metres of gas and six billion barrels of estimated oil reserves. Current estimates indicate that, in addition to huge gas deposits, the Caspian basin possibly possesses as much as 200 billion barrels of oil, 33 times the estimated holdings of Alaska’s North Slope, with a current value of US$4 trillion.[31] Proven resources at the Caspian shelf do not exceed 12 billion tons, i.e., approximately 3 per cent of global reserves. Out of this, 7 billion tons comes in the form of crude; the rest is represented by 5 trillion cubic metres of gas.[32]

Turkmenistan has 546 million barrels in proven oil reserves. The country’s oil production, which steadily declined after independence, from 110,000 barrels per day (bbl/d) in 1992 to 81,000 bbl/d in 1995, has increased dramatically in the past six years, reaching 156,400 bbl/d in 1999, before levelling off in the past two years. In 2001, Turkmenistan produced 159,000 bbl/d of oil, while consuming 52,000 bbl/d. Turkmenneft, the state oil company, produced approximately 90 per cent of this total, with the remainder coming from the state natural gas company, Turkmengaz, and several foreign oil companies operating under PSAs in Turkmenistan.

Under a ten-year programme formulated by President Saparmurat Niyazov, Turkmenistan aims to raise its oil production to nearly one million bbl/d by 2010. It had planned to increase its oil output to 200,000 bbl/d last year (2002), with additional production coming from newly developed wells in the western part of the country. In an effort to create a better business climate to attract foreign investment, in June 1998 Turkmenistan restructured its oil and gas industries to form several state-owned companies.[33]

Turkmenistan has some of the world’s largest deposits of natural gas, with proven reserves of approximately 101 tcf. Almost half of the reserves are located in the giant Dauletabad-Donmez field. Large deposits, estimated at 27 tcf, are found in the Murgab basin. During the last ten years Turkmenistan has discovered 17 new natural gas fields. Its production began to climb steadily, jumping to 1.64 tcf in 2001, against the consumption of just 0.26 tcf. Turkmengaz produced 80 per cent of this total, with Turkmenneft accounting for the remaining 15 per cent. During the first two months of 2002, Turkmenistan had produced 413 billion cubic feet (bcf) of natural gas.[34] Turkmenistan’s possible oil and gas reserves are up to 1.7 billion barrels. These reserves are situated mainly in the western part of the country and in undeveloped offshore areas in the Caspian Sea.[35]

Kazakhstan ranks second–after Azerbaijan–among the oil-producing republics of the former Soviet Union. It exports oil mainly to the Russian Federation, due to the fact that it is geographically landlocked and the transit routes and oil pipelines pass through Russia. Oil represents 15 per cent of its total exports. It has proven reserves of 5.4 billion barrels.[36]

Kazakhstan’s oil production has doubled in the past six years. Since 1998, its output has been increasing by approximately 15 per cent per year. It was expected to produce over 900,000 bb1/d in 2002. From January 2002 through May 2002 its production of oil and gas condensate totalled 18.52 million tons (892,600 bbl/d), a 12.4 per cent increase over the same time period in 2001. Kazakh oil production is expected to reach 1.2 million bbl/d in 2005, 2 million bbl/d by 2010, and as much as 2.5 million bbl/d by 2015.[37]

Kazakhstan’s possible hydrocarbon reserves, both offshore and onshore, dwarf its proven reserves, with estimates ranging between 30-50 billion barrels. They are mostly in the Kazakh sector of the Caspian Sea.

Kyrgyzstan imports oil to meet its domestic needs. Its estimated oil reserves are only 40 million barrels. In 2000, Kyrgyzstan produced an estimated 2,100 barrels per day. Oil reserves in the Ferghana valley are estimated at 733 million barrels. Under a programme to develop the country’s oil sector, Kyrgyzstan plans to produce 3,000 b1/d by 2005. The country’s natural gas sector is small, with proven reserves of 200 bcf.[38] In the Ferghana valley there are possible oil reserves of 200-300 million tons (1.47-2.12 billion barrels).

In Central Asia, only Tajikistan is poor in oil and gas deposits. It has proven oil reserves of only 12 million barrels. Its proven natural gas reserves are 200 bcf.[39]

Uzbekistan is estimated to have 594 million barrels of proven oil reserves. It has 171 discovered oil and natural gas fields in the country. Its proven natural gas reserves are 66.2 tcf, which makes it one of the top 10 natural gas producing countries in the world.[40]

Since becoming independent, Uzbekistan has increased its natural gas production by over 30 per cent from 1.51 tcf in 1992 to 1.99 cf in 2000. According to preliminary data, Uzbek natural gas production increased to 2.03 tcf for the year 2002.[41]

Water is another source of potential conflict in Central Asia. It is not evenly distributed in the region. The two states, Tajikistan and Kyrgyzstan, which are not endowed with great hydrocarbon resources, have water wealth instead. The headwaters of Central Asia’s great rivers, the Amu Darya and Syr Darya, originate in the Tien-Shan and Pamir mountain ranges. The source of the Amu Darya lies in Tajikistan, where it is known as the Pyani, but it flows through Uzbekistan and Turkmenistan before reaching the Aral Sea. The Syr Darya rises in Kyrgyzstan, where it is fed by two smaller rivers, the Navyn and the Kara Darya. It then flows through eastern Uzbekistan, Tajikistan, and Kazakhstan before draining into the Aral Sea. The excessive drainage of water on the way to the sea is a source of tremendous environmental hazard because of depleting supply.[42]

Access to reliable and clean sources of water for consumption and irrigation is one of the most vexing problems in Central Asia. The dramatic shrinkage of the Aral Sea is perhaps the best-known water-related disaster. And a major drought in 2000 in several states highlighted the region’s inadequate and unstable allocation of water resources. The large amount of water needed for cotton, a major crop in the region, has resulted in gradual decline in the level of the Aral Sea. This desiccation is the most dramatic example of water mismanagement in the former Soviet Union. They used water for irrigation of cotton crop and disposed of industrial waste in the Aral Sea. This policy resulted in water pollution, which caused shortage of drinking water. There are no permanent flows and groundwater resources within the plains and territories of Central Asia. Some experts estimate that the deficit of fresh water is increasing. At least 5,000 million gallons of fresh water is needed for individual consumption within Central Asia. There is a significant amount of polluted water from industrial, municipal, and agriculture drainage wastes.[43]

The Uzbek and Turkmen governments prefer to deal with water issues on a bilateral basis and have rejected various proposals for a regional water management programme put forward by the UN, the World Bank, the Organization for Security and Co-operation in Europe (OSCE), as well as other aid organizations. Regional co-operation on water is thus highly problematic, but not impossible. USAID did manage in 1998 to pressurize those states through which the water of the Syr Darya flows to sign an agreement concerning allocation of the river’s flow.

For the Central Asian states, it is time they developed their own mechanism to regulate water movements, given its critical importance in an acutely water-scarce environment. Such a regional arrangement is also necessary to ensure the maintenance and upgrading of the water supply infrastructure. This is a problem which can only be solved by an enlightened combination of collective and local national interests.[44]

Water is the biggest source of power production in Central Asia. Kyrgyzstan’s abundant water resources provide it significant hydroelectric potential. The energy potential of its mountain rivers is estimated at 163 billion kilowatt-hours (bkwh) per year, of which only about 10 per cent is currently exploited. Hydroelectric energy meets approximately 20 per cent of Kyrgyzstan’s primary energy requirements and accounts for nearly 20 per cent of its total exports. With rapidly growing energy demand in neighbouring countries, Kyrgyzstan’s hydroelectric power potential is becoming more attractive to foreign investors. The long-delayed 450-megawatt Tash Kumyr hydroelectric plant was put into full operation in 2001, and Kyrgyzstan is working to secure financial resources to construct two power-generating units at the Kambar-Ata hydroelectric plant.[45]

Tajikistan had a total installed electricity-generating capacity of 4.4 gigawatts (GW) in 2000. Most of the country’s electric power comes from seven large hydroelectric plants, which have a combined capacity of 4.05 GW. The Nureksk hydroelectric plant, which has nine units of 300 megawatts each, accounts for nearly 70 per cent of this power. Other hydroelectric plants include Golovnaya, Baipazan, Namadgud, Lenin, Pamir-1, and Qayroqqum. Tajikistan also has several thermal power plants, with a combined capacity of approximately 350 MW. In 2000, Tajikistan generated 14.2 Bkwh of electricity and consumed 12.5 Bkwh. Barq-i-Tojik is the state company that controls electricity generation, transmission, and distribution in Tajikistan. Tajikistan is hoping to modernize its power infrastructure by attracting foreign investment in the sector.[46]

Much of Uzbekistan’s electric power is generated from natural gas-powered plants, with smaller amounts generated from coal-fired and hydroelectric facilities. Water is not an important source for producing electricity in Uzbekistan.

With 3.9 gigawatts (GW) of installed capacity, 99 per cent of which is thermal, Turkmenistan has sufficient electricity-generating potential to power its own cities, unlike much of Central Asia. Most of the electricity that Turkmenistan exports is to southwestern Kazakhstan and northeastern Afghanistan; Armenia and Iran have also discussed greater co-operation in the energy sector with Turkmenistan. A power transmission line, connecting Turkmenistan to northern Iran, would allow Turkmen electricity exports to Iran and to Armenia, since the electricity grids of Armenia and Iran are connected.[47] By utilizing water to produce electricity, Turkmenistan can earn significant foreign exchange.

Kazakhstan has 71 power plants, including five hydroelectric power stations, providing the country with an overall installed generating capacity of 17.3 gigawatts. Approximately 70 per cent of Kazakhstan’s power plants use coal, 15 per cent natural gas, and the remaining 15 per cent hydroelectric power. Much of the country’s electricity is generated by coal-fired plants that burn a highly polluting, high-ash coal; moreover, most of its electric-generating equipment is old, inefficient, and lacking in modern pollution controls. Water is not utilized to its maximum capacity for generating hydroelectricity.[48]

International trade today is a highly developed phenomenon which requires hard currencies, proper banking systems, suitable marine and liability insurance covers, liability regimes for transporters, contractors and third parties, proper information and communication network efficient customs facilities, and trained manpower. Direct sea routes and well-equipped seaports with adequate cargo-handling equipment are also essential requirements for meaningful international trade. The Central Asian region is facing a dilemma: it can choose the economically more promising trade flows moving in the east-west direction through the Caucasus to western Europe and the Mediterranean; or it can rely on Iran and Russia for furthering trade in the north-south direction.[49]

Pakistan is centrally located in the continent of Asia. Along the Northern Areas of Pakistan, adjacent to Hunza, is China’s autonomous region of Xinjiang. A narrow strip of Afghanistan, the Wakhan corridor separates this region from Central Asia. Towards the west and northwest are Iran and Afghanistan and on the east and south, it borders on India. The coastline of Pakistan runs along the Arabian Sea between the borders with Iran and India. As the Central Asian states have no access to the sea–the basic requirement for major international trade and commerce–their trade has to be routed through another country with developed seaports. Karachi and, in due course of time, Gwadar, will provide the nearest approach to the warm waters of the Arabian Sea and offer the main outlet for trade expansion to the Central Asian states. Trade routes through Pakistan provide a classic case for the use of multimodal transport.

Another factor which needs to be kept in mind is the traditional and historical caravan routes which existed between the Indian subcontinent and the Central Asian states of today. Their early revival and reactivation to suit the modern requirements of an open-market economy can be of great help in the economic development of the region.[50]

Pakistani economists have discovered a number of complementarities in the economies of the two regions. The Central Asian republics can supply oil, gas, electricity, and such minerals as copper, iron, chromium, and lead to Pakistan, while in return Pakistan can supply textiles, cement, medicines, shoes, machinery, and telecommunication equipment.[51]

Central Asia is a region with fertile plains. Both banks of its two major rivers, Syr Darya and Amu Darya, are fertile. Their major crops are cotton, grains, and sugarcane. Due to various political and technical reasons, the Central Asian states can only meet their own needs with their agricultural production. Polluted water is causing agricultural degradation, which is a major source of concern for these states.[52]

As far as agriculture is concerned, one major assumption has been that collective farmers in the region derived higher incomes from this source and, with guaranteed employment, they had no desire to migrate to cities, without assurances of higher income and employment security.[53]

Central Asian agriculture is in the process of transition. Keeping in view the existing realities, its agricultural potential cannot be considered as a factor capable of driving the policies of the Central Asian states themselves, far from interesting neighbouring countries. These republics lack the basic communication infrastructure, a flaw responsible for insufficient agro-production.

After assessing the potential of Central Asia, it is evident that the region is rich in valuable natural resources which are in great demand in the world market. These resources remain untapped for a number of reasons, the principal one being their inaccessibility to markets. International capital is keen to enter the Central Asian countries and exploit their natural resources, in particular oil and gas. But in order to make them accessible to the world markets, the region must establish a good communication infrastructure. However, because Central Asia is a landlocked region, there are technical, political, and strategic difficulties in laying such an infrastructure. The economic prospects of exploiting Central Asia’s natural resources involve several attendant political and strategic issues.

In international relations, ‘national interest’ is an effort to describe the underlying rationale for the behaviour of a state which preserves and protects its values and institutions, besides its territorial integrity against attacks. National interests can be defined as ‘the general and continuing ends for which a nation acts’.[54] Needs and desires of any state act as its strategic drivers. At the global level, clashes of interests result in conflicts over economic power and welfare, manifested in disputes over trade, investment, and other issues. [55]

During the nineteenth century, Britain and Russia vied with each other to enhance their influence in Central Asia, Afghanistan, and Persia (now Iran). This competition was termed the Great Game.[56] In the present-day scenario, the Russian Federation is trying to maintain its monopoly on Central Asia’s resources, to secure its vital strategic interests. On the other hand, these Russian efforts are perceived by the United States as threatening its vital interests. To protect these interests, US policy-makers have adopted strategies to undermine Russian influence in the region. An expert on Central Asia once stated that, ‘There is a “Great Game” of a sort. The stakes of the players are high, the rules do not appear to be fixed and there is a competition and also cooperation between players. The end is not in sight but the game has certainly commenced.’ [57]

The states in the new great game have adopted one of the basic principles of realistic analysis in international relations: competition rather than co-operation, with the USA and Turkey versus Russia and Iran being the competing forces, and oil companies playing a very important role.

A brief account of the interests of various powers involved in the ‘New-Great Game’ is given below.

The United States is exploring opportunities for developing close ties with the countries of the region. It says it is interested in the emergence of western-style democratic institutions, free-market economy, political stability, human rights, and environmental issues. Washington wants an opportunity to participate in the economic development of the CAS through multinational corporations.[59] It would like to have friends who are geographically close to Iran and Russia, so that neither of these countries gains control over the energy supplies from the Central Asian region. The USA is therefore supportive of oil projects in the Caspian region and has invested a great deal in developing them.

Washington has three main policy goals in the region: first, to ensure the ‘sovereignty’ and ‘independence’ of the countries of the region; second, to exploit their oil and gas reserves. The USA wishes to have its own commercial involvement in the region’s oil production and export, on the basis that the involvement of its own companies can help further economic reform in the region and facilitate its integration into the world economy. Such commercial involvement could also enhance the US presence in the Caucasus and Central Asia and help develop highly valuable resources, with private US companies bringing the required capital, management, and technology.

Such involvement in lucrative oil deals will naturally bring economic benefits to the USA. Its policies are to support the diversification of the sources of world oil supplies to reduce future dependence on oil from the Persian Gulf, [60] over which it consolidated its control in the 1991 Gulf War. At that time, the USA launched ‘Operation Desert Storm’ in the Gulf region, and now it has deployed its forces in Central Asia under a military move codenamed ‘Operation Enduring Freedom’. It is determined to see that any major new oilfields being opened to the world market will be controlled by the USA.

Third, its goal is to concentrate on neutralizing Russian influence in the region. Its policy-makers are trying to contain Chinese influence in the region as well. Several US multinational oil and gas companies are operating in Central Asian countries and deriving economic benefits by exploiting their reserves.

· Most of that is exportable, since the energy needs of the producing countries are relatively limited and are expected to remain that way.

· Due to the region’s lack of capital and technology for developing these oilfields independently, American companies, such as Chevron, have considerable investment opportunities.[61]

· The stability of the Central Asian states is important to the other former Soviet republics and their ideological direction may greatly affect all Asian countries and the Muslim world as a whole. American security concerns relate not to nuclear weapons alone but also include nuclear research and power reactors in Central Asia. This fact leads them to seek to ensure nuclear non-proliferation in the region.[62]

· The USA intends to help the former Soviet republics to develop their oil and gas industry, guaranteeing their economic growth, while hoping to keep them out of the Russian sphere of influence.

· The US government is actively supporting American companies in Central Asia involved in oil development as well as in the construction of pipelines that could channel the oil to the West. The USA is interested in channelling the oil coming from those countries into international markets, in order to diversify its own sources of supply and keep oil prices low.[63]

· The USA wants to see economic growth in the region to promote regional stability and resolution of local disputes, so that its own interests are not affected.

· The US government is interested in bolstering Turkish influence in the region. To achieve this objective, it is pushing for the proposed pipeline route that will transport oil from Baku to the Turkish port of Ceyhan while bypassing Russia and Iran. At the same time, it is pursuing its policy of containment and isolation of Iran and China.

The US policy towards the region is reflected in the following statement made in the US Congress:

‘The overarching and the long-term goal of US policy in Central Asia is to see these states develop into stable, free market democracies, which can serve as a bulwark against the spread of potential instability and conflict in the region. This broader goal serves three core interests of the United States; regional security, political and economic reform and energy development.’ [64]

The Russian Federation has the most visible presence in Central Asia. Its control on Central Asia over the past one and a half century makes it the most potent influence in the region. Its behaviour towards the CAS continues to be guided by this historical legacy. The Russian policy-makers term Central Asia their ‘Near Abroad’.[65] Russia neighbours Kazakhstan and the Caspian Sea. The economic and social demands of the CAS require close relations with the Russian Federation. The Federation provided 68 per cent of Kazakhstan’s imports, 58 per cent of Uzbekistan’s imports, 51 per cent of Kyrgyzstan’s imports, and 38 per cent of Tajikistan and Turkmenistan’s imports in 1992. On the other hand, it received 61 per cent of Uzbekistan’s exports, 54 per cent of Turkmenistan’s, 53 per cent of Kazakhstan’s, and 39 per cent of Kyrgyzstan’s exports.[66]

Driven by its vital strategic interests, Russian policy-makers formed a union of the CAS within the framework of the CIS (Commonwealth of Independent States) under Russian leadership.[67] The Russian Federation is interested in the region’s oil and gas reserves and seeks to direct the export routes and pipelines through its territory, not merely for the financial benefits and economic advantages it will bring to the Federation but also to maintain its hegemonic role in the region. Otherwise, the ‘Russian Federation has large reserves of oil and its oil exports are on the rise’.[68] President Vladimir Putin is trying to improve Russia’s relations with the Central Asian states on a bilateral basis, and looking for a greater Russian role in the region’s oil and gas politics.

Russian interests in the region include: preservation of traditional influence in the region; safeguarding economic investment, and participation in future economic growth; protection of the interests of the large Russian communities living in the region; averting possible security threats from resurgence of ‘Islamic fundamentalism’; [69] stopping the arms and drugs flow coming to Russia from its south; [70] preservation of its control over the external borders of the CIS in Central Asia; and the permeability of Central Asian borders for imports from and exports to Russia.[71]

According to a declaration of the Russian National Security Council in April 1993, ‘Russia cannot leave the Central Asian republics without putting all of its southern “underbelly” in jeopardy’.

Russia’s geo-strategic interest in the region is to remain strong in the area and wield power within, and control over the CIS, thereby ensuring the security of its southern flank. Geopolitically, Russia wants to retain its influence within the space of the former Soviet Union. This aspect directly determines the future of Russian statehood. The economic interest of Russia is to maintain the status quo regarding pipeline routes and transit corridors.

The independence and freedom of the Central Asian countries will stand in the way of potential Russian imperial expansion. The ‘new great game’ in the region is about much more than cheap oil. It is about Russia’s future and about its character in international relations. It is about the chance for millions of people of the former Soviet Union to live in peace, relative wealth, and freedom.

The geographical location of China, which shares a common border with three out of the five CAS, and also shares a long border with Russia, obliges it to play a major role with regard to the maintenance of peace and security in the Central Asian region. Although China immediately established diplomatic relations with the newly independent states, its foreign policy towards the region evolved slowly. Despite some territorial disputes, China has cultivated good relations with these countries since their independence.[72]

· Good-neighbourly relations with Central Asia, in the interest of peace and stability on its periphery.

· Prevention of Central Asian interference in its internal affairs, especially in the Xinjiang (Muslim) and Tibet regions.

· Good relations with Russia on international issues and improvement in trade relations.

· Development of diversified transportation corridors from the region to facilitate the flow of trade, and energy and mineral resources.

· Promotion of internal stability in Central Asia and limiting the role of extra-regional powers in the region.

In crafting its policy towards Central Asia, Chinese officials have sought to determine how a fine balance can be secured between long-range strategic interests on the one hand, and satisfying their more immediate domestic, political, and economic interests on the other. Reduction of Russian influence in Central Asia is important for China in the long term. However, China’s current policy towards Central Asia is focused on the Xinjiang region. Chinese policy is driven mainly by the modernization imperative and is shaped by a generally stable and productive relationship with Russia as well as by the persistent Russian involvement and influence in Central Asia.[73] According to a Chinese scholar, ‘confrontation with any state involved in the “new-great game” in Central Asia is not in Chinese interest’.[74] While following a policy of non-confrontation, China seeks to strengthen its economic and political ties with the Central Asian republics. In this context the Chinese leadership has lately played a leading role in the formation of the Shanghai Co-operation Organization (SCO), meant not just to counter American influence but also to derive economic benefits from the CAS.

Geographical proximity as well as its emerging status as an economic giant require China to assume a special role; it would also like to ensure that ethnic and religious links between the Muslim population of Central Asia and its own Muslim population do not assume a negative character from its point of view.[75]

In the future, China’s role probably will be more pronounced in the economic realm. It is interested in trade with the CAS and the region is a large potential market for Chinese goods; it is also a source of raw materials. Moreover, goods produced in the CAS can be marketed in China. For a couple of decades, China’s interaction with the region has been ever-increasing. If they continue to grow, China may adopt an open-door policy, though its relations will be characterized by caution and pragmatism.

The Central Asian states are looking to the West for financial, technical, and political assistance to reduce their dependency on the Russian Federation. The European Union is in a position to meet their requirements. In particular, EU involvement is manifesting itself in the provision of generous financial aid through ad hoc programmes, aimed at consolidating the uncertain steps towards market economy and democracy in the Central Asian states. The rising western presence in this region will always be a counterfoil to Russian claims in its sphere of influence.[76]

The European Union interest in Central Asia emerged when the region’s energy resources captured the attention of the world, leading to increasing engagement in the exploitation of oil and gas deposits. The EU has a soft corner for the Central Asian states and aims to ensure a politically and economically stable Central Asia to safeguard its strategic interests.[77]

· To give technical assistance to the Commonwealth of Newly Independent States. [78]

· To play a significant role in institution-building in Central Asia, along with the OSCE. [79]

· To be a trading partner of the CIS, while exploiting the region’s energy resources.

Furthermore, the European Union has an important political stake in Central Asian policies in that it has an interest in stabilizing the region against rising terrorist activities and the smuggling of drugs produced in Afghanistan, which appear to enter Europe through Central Asia. The EU supports the plan to build a new ‘silk route’, bypassing Russia, across the Ukraine, Georgia, Azerbaijan, Turkmenistan, Uzbekistan, and Turkey.

The European Union is also keenly interested in the exploitation of Central Asia’s natural resources. The USA does not feel threatened by this approach of the EU; in fact, it is apparently encouraging such developments and appreciates the positive effect of the EU’s political engagement in Central Asia.

With the collapse of the Soviet Union, the geopolitical depth of the region has undergone a change. Iran has emerged as a bridge linking the Persian Gulf region to the new republics of Central Asia. If security and prosperity are maintained in these two regions, Iran’s security and development will be enhanced. Apart from their historical relations, a bond exists between the Iranians and the Central Asian nations. According to an observer, ‘from the political perspective Iran wishes stability and economic progress [to] emerge and enhance in these republics’.[80]

Iran does seek closer economic ties with the south Caucasus and has made special efforts to trade with Central Asia, especially Turkmenistan. Despite hard times at home, Iran has made significant investments in developing a railway system in Turkmenistan which will connect all the five Central Asian states and Russia to the Iranian network and onward to the Gulf. Iran has encouraged the transport of goods by road from the Gulf states to Central Asia, along with the use of its own ports and those of Turkey. Iranian and Turkish trucks are a common sight on the highways of Central Asia and Iranian goods are found in the markets of these republics.

Given its geographical proximity, Iran is also interested in obtaining a substantial share of the Caspian oil and gas resources, even though it has huge onshore reserves of both commodities. Accordingly, Iran has strongly supported the stance of the Soviet-Iranian Treaty of Moscow, that the Caspian Sea and its deposits should be the common resources for all littoral states. However, Azerbaijan and Kazakhstan stand to gain more from a Caspian division into national sectors.

Iran’s interest, based initially on its ties to the Persian-speaking Tajiks, can also be explained by its desire to break out of international isolation. Tehran plainly seeks to establish a sphere of influence in a region of great importance to its neighbours and competitors.[81]

The final area of Iranian interest involves cultural, ethnic, and religious ties that have kept Iran historically inseparable from the Caucasus and Central Asia. Persian was spoken and written all along the Silk Road and is related to the modern Tajik language. Moreover, their ethnic ties remain in addition to Iran’s large Azeri population and about a million Turkmen living in Iran.[82]

The West and the USA in particular are opposed to Iranian influence in the region. However, Iran, which also hosts the headquarters of ECO (Economic Co-operation Organization) in Tehran and plays a major role with regard to the security situation in Afghanistan, will remain an important player in the future evolution of Central Asia.

Turkey has strong historical, cultural, and economic ties with the CAS. Four of the Central Asian states were originally established by the Turks and their peoples speak Turkish. These ties, however, were considerably weakened during the Soviet period.

The dissolution of the USSR gave Turkey the opportunity to renew its historical association with these ethnic groups and to increase its influence in the region. This has been made a priority in Turkish foreign policy. Its traditional relations with Central Asia have often been nurtured at the expense of Turkey’s historical rivals, Russia and Iran. It has presented itself as a development model for the newly independent states, and has generally been seen as a more attractive example to emulate than Iran, which is equally keen to play a leading role in the area. In this regard, Turkey has concluded a number of political, military, and economic agreements with the Central Asian states, and commercial ties have deepened, particularly since 1991.

Turkey’s major interest in the region is commercial. This involves its stake in Central Asian energy production and transportation as a participant and as a buyer, and its role as a provider of retail markets for the CAS. Its main interest in Central Asia’s natural gas is as a consumer and the Turkish gas market is very large.

Turkey is also interested in a major pipeline project, starting from Turkmenistan and running through Turkish territory to an outlet on the Mediterranean sea. In October 1992, Turkmenistan and Turkey initiated an accord for the construction of such a pipeline.[83]

Turkey’s political interests in the region are quite distinct on either side of the Caspian. Conflict on its borders can inflict harm on Turkish economic and political interests in the region, while destabilizing Turkey’s relations with Iran and the Russian Federation.

Turkey’s high expectations of being a major player in the region have not been fulfilled, partly on account of the lack of direct communications, and partly due to the limitations imposed by its economy, politics, and geography. However, there is mutuality of interests in close relations in the cultural and economic fields for Turkey and the CAS, and the ethnic and linguistic links will continue to figure strongly in their interaction, especially under the auspices of regional groupings.[84]

· Ensuring secure transportation of oil and gas supplies from new sources to Western markets via Turkey.

India is seeking avenues to derive economic benefits from Central Asia, while bypassing Pakistan–a major concern. India’s announcement of a plan to construct a railway line connecting Central and South Asia is an instance of this strategy. This project could not materialize for obvious geographical reasons, as India does not share any borders with the region.[85]

India presented another proposal, seeking the construction of an energy pipeline from Russia across Central Asia and China. This proposal is a reflection of the Indian desire to avoid using Pakistani territory for routing fuel lines through Pakistan, despite India’s mounting energy needs. Although Russia and China had welcomed further discussion, the feasibility of this pipeline project is highly doubtful for economic, technical, environmental, and security reasons.

India’s main interest in Central Asia is to counter Pakistan; hence its policy is Pakistan-centred. This policy could be termed ‘interest-based confused policy’.[86] For instance, soon after the agreement was signed between Turkmenistan, Afghanistan, and Pakistan for the construction of a gas pipeline from Turkmenistan to Pakistan via Afghanistan, India’s ONGC (Oil and Natural Gas Corporation-Overseas) announced a counter-proposal–the ‘Energy Highway’–to construct a Russia-China-India (RCI) pipeline. Though undoubtedly of interest for both India and the energy-producing states to the north, the feasibility of the project is compromised by its anti-Silk-Route design. The new proposal, if feasible, would appear to undermine the most convenient Afghanistan-Pakistan oil and gas transit route. The RCI is supposed to stretch from Russia through Turkmenistan, Uzbekistan, Kazakhstan, to Kashgar in the Chinese region of Xinjiang. It will enter Indian-occupied Kashmir via Ladakh, crossing the Siachen glacier and the Indo-China Line of Control–or alternatively through Himachal Pradesh–to supply gas to Northern India. The proposed pipeline would extend over an extremely long stretch of immensely varied and difficult terrain and may cost anywhere up to $15 billion to build, or slightly less if connected through already operating pipelines. The Central Asian republics are interested in any proposal that promises an oil- and gas-exporting outlet. Russia and China, on the other hand, are likely to consider the broader geopolitical and security aspects before they agree to the construction of any pipeline. The possible environmental damage resulting from it, security problems, the high economic cost of its construction and structural maintenance–from every aspect it seems an unrealistic project. This is especially true in the face of other cost-effective and more convenient short-cut alternatives that are readily available.[87]

Politically, the very long distance design of the RCI pipeline, crossing over the Indo-China Line of Control and the glaciers that spread around Pakistan’s Karakoram range, are likely to raise serious military security concerns both in China and Pakistan. The shortest and economically most viable routes for oil and gas export from Central Asia are through Iran, Afghanistan, and Pakistan, more or less along the historic Silk Routes and their connections. In spite of India’s pressing energy needs for its industrial infrastructure, domestic politics in India are complicating the picture. The ruling Bharatiya Janata Party (BJP) government is adamantly opposed to the more cost-effective Pakistani route due to hardline perceptions of influential sections of the party elite that seem unwilling to accept the existence of the Pakistani state. Over the last five years, Pakistan has approved Iranian, Afghani and Turkmenistani proposals for gas supplies to India via Pakistan, hoping that economic interdependence might help reduce bilateral tensions between the nuclear-armed neighbours. However, India rejected an Iranian offer to supply gas through Pakistan. Incidentally, if India uses the Pak-Afghan-Turkmen pipeline, it will pay $600 million annually to Pakistan in pipeline transit fees.

It is highly unlikely that the Chinese government would grant India a pipeline corridor across the line of control on the China-India border for security reasons. Ever since 1992, China has consistently denied Indian requests for a corridor to construct an India-Central Asia railway line through western China, chiefly for these security reasons. Therefore, Indian requests for the construction of the RCI pipeline through Xinjiang are likely to be rejected.[88]

Environmentally, besides the normal damage that pipeline construction entails, the RCI’s construction through the glaciers near the Pakistan-China border could cause serious environmental damage. The consequences of an alteration in the Siachen glacier could cause environmental water problems beyond floods and storms all over South Asia and parts of Central Asia. Like other Indian suggestions aimed at bypassing Pakistan in accessing Central Asia, these suggestions are difficult to implement.

Central Asia has strategic and economic importance for India. Since these states gained independence, Indian officials have made conscious efforts to strengthen and diversify relations with them. India’s interests generally converged with those of Iran and Russia. Indian policy-makers refer to Central Asia as their ‘extended strategic neighbourhood.’

There is mutual recognition that the national security concerns of Central Asia and India are closely interlinked. These interests involve the containment of cross-border terrorism, Muslim extremism, and drug trafficking. In the economic sphere, the abundant natural resources of Central Asia and India’s technological and scientific capabilities provide the rationale for collaboration.

Apart from its Pakistan-centred negative approach, India’s strategic interest in the region has been that of positive engagement with the region, considering the vast opportunities for India. The economic dimension of mutual relationship has been seen as the most significant to India’s long-term strategic interest. India is developing stronger trade ties with the Central Asian states in a bid to link up with the emerging east-west economic corridor to secure its strategic and economic objectives.

The CAS, despite being superbly endowed with natural resources, suffer from geographical isolation and are remote from international waterways. The lack of co-operation in economic affairs has exacerbated the ‘tyranny of distance’ which all the republics suffer from. They are increasingly dependent upon the outside world and especially their neighbouring countries for trade and transportation of their natural resources.[89]

Currently, at least ten different proposed routes out of the region are under consideration by the countries and oil companies involved in the Caspian projects. Undoubtedly, many more proposals will be considered as more oil from new projects comes on line. All the options are complicated, and none is trouble-free, because no matter what the route, they either pass through politically risky areas or offend the strategic sensibilities of one or another of the regional powers. The choice of routes will be subject to myriad combinations of local and regional interests and technical and infrastructural practicalities.

Russia, Iran, Turkey, and the United States compete over exploration, drilling rights, and the routes and directions of pipelines in Central Asia and the Caucasus. These states understand the importance of controlling both the development and the transport of the region’s resources. Their companies, however, face competition from the oil and gas companies of China, Japan, India, and Korea. The competition is certain to increase as the scope of the resources available becomes clearer. Currently, the existing pipelines run northward to Russia, and give Moscow exclusive and strategic control over related exports and a vast amount of revenue that it fails to share with the host countries that own the oil. Russia’s pipeline system is overflowing with oil, but its reliability, security, transparency, tariff structure, and access do not satisfy either the needs of Western companies or those of the newly independent states (NIS). For example, Russia delayed access to the route used for the transport of Kazakh oil for Azerbaijani oil, through Chechnya, to its oil terminal in the port of Novorossiysk on the Black Sea, notwithstanding contracts signed with the AIOC. Western companies therefore will need to overcome formidable challenges in order to transport the oil to markets in the West. The oil terminal in the Black Sea port of Supsa, Georgia, which will be important in transporting early shipments of Central Asian oil, is still unfinished.[90]

Several pipelines in a north-south direction are feasible. Ultimately pipelines may be built from Turkmenistan and Uzbekistan to Pakistan. Unocal (US) and the Delta Oil Corporation (Saudi Arabia) were named as consortium leaders for a gas pipeline proposed by the government of Turkmenistan in October 1996. Russia’s natural gas and oil giant monopoly (Gazprom) and a Turkmen-Russian government oil company (Turkmen Ros Gaz) also are part of the consortium.[91]

A natural gas pipeline running from the Daulatabad field in southern Turkmenistan to central Pakistan was proposed by the Turkmen government. An oil pipeline running the same route was also suggested. These pipelines would benefit the people of Afghanistan, bringing jobs and infrastructure development, such as roads, to that long-suffering country.

Central Asia is landlocked and geographically distant from global industrial centres. This oil must be transported out of the region by a system of pipelines. Whoever controls the pipelines ultimately controls the oil. Russia proposed building a new northern pipeline, parallel to the old one from Baku to Novorossiysk, and to expand companion pipelines from Tengiz to Novorossiysk. Iran proposed a southern pipeline across its territory from Baku in Azerbaijan to the Iranian oil terminal on the Kharg Island. This route would turn the Caspian Sea into a hinterland of the Persian Gulf countries, the centre of the world oil economy. Some oil companies have supported this Iranian plan as this route was estimated to be the cheapest available.[92]

The USA was determined to oppose any north-south pipelines. The White House adopted a plan drawn up by the long-time ruling class strategist, Zbigniew Brezezinski, to create an ‘east-west’ pipeline, which would bypass both Russia and Iran. The USA intends to strip Russia of control over the energy resources in the region. Instead, it wants the Central Asian oilfields to be independent of the Persian Gulf, thus reducing the importance of the Gulf states in the global oil economy. The US-proposed pipeline would start from Baku, and travel west through Azerbaijan. It would deliberately take a detour around Armenia, which is allied with Russia. It would then circle into Georgia, before travelling southwest across Turkey. The greater part of the pipeline would pass through the Kurdish areas of Turkey, where there has been an ongoing armed struggle against Turkish oppression of the Kurds. The pipeline would end at a Turkish port near Ceyhan on the eastern Mediterranean. The US planners propose a second pipeline for gas as well, traversing over 1,000 miles from Turkmenistan to the Turkish city of Erzurum.

Two recent developments hold implications for all interested parties. First, Russia has covered its equity share in the Caspian Pipeline Consortium (CPC) by paying its contribution to the 200 kilometre section of pipeline, linking Atyrau and Komsomolsk and forming part of the proposed Tengiz-Novorossiysk line. The CPC is a Russia-Oman-Kazakhstan partnership established for the purpose of building an export pipeline to connect the Tengiz oilfield in Kazakhstan with the port of Novorossiysk. The value of this section of the pipeline, placed at $300 million, was derived through an audit carried out by several Western companies. Second, the CPC has taken the first step in providing for an outlet for Tengiz crude oil to world markets by agreeing to build a 250 kilometre pipeline from Kropotkin, south of Tikhoretsk, to a new terminal to be built north of Novorossiysk. Initially, this first segment will carry mostly Russian oil and reportedly will be financially viable once it reaches the capacity of handling 180,000 barrels per day. [93]

One export route under consideration will pass initially through Russia or the Caucasus and then through the Black Sea and Turkey to the Mediterranean the CPC route from Tengiz through Tikhoresk to the port at Novorossiysk.[95] The northern route is favoured by Russia. According to this option, Kazakhstan will expand its existing pipelines to link them with the Russian network, and Azerbaijan will build a pipeline from Baku to Novorossiysk. The shortcomings of this option have to do with fears of Russia establishing excessive control over the pipeline and also the issue of security, since the pipeline would go through Chechnya.[96]

The Baku-Novorossiysk pipeline, also referred to as the northern pipeline, traverses Russian territory to Novorossiysk via Chechnya; it is unsafe because of the instability and restlessness in the north and south Caucasus. This pipeline has been in operation since October 1997, and the first Azerbaijani oil is flowing north.

The issue of the Turkish straits affects the routes that traverse the Black Sea. Principally for environmental and safety reasons, Turkey has been reviewing limits on tanker traffic through the Bosphorus straits, where more than one-third of the oil from the former Soviet Union now passes. Russia had hoped to increase oil exports from the Caspian region through its Black Sea ports and then through the Straits, but any likely restrictions by Turkey may make it difficult to increase exports above current levels. Although Turkey has cited genuine environmental dangers to explain its position on the use of the Straits, political and economic considerations may also play a role in Turkish thinking, given the attractive option of a pipeline route through Turkey itself.

The United States and Turkey favour the western route for transportation of oil, through Georgia and Turkey to the port of Ceyhan on the Mediterranean.[97] This pipeline route will bring oil to the Georgian port of Supsa and then ship it through the Black Sea and the Bosphorus Straits to Europe. Turkey insists that the Straits cannot cope with increased tanker traffic and has proposed, instead, constructing a pipeline from Baku to the port of Ceyhan on the Turkish Mediterranean coast. However, excessive costs (around US$2.9 billion) and serious security concerns–this route would pass through unstable Kurdish territory–make this option difficult to implement. Instead, the Bosphorus could be bypassed by a pipeline linking the Bulgarian port of Burgas with the Greek port of Alexandroupolis.[98]

The Azerbaijani government, however, would prefer to export Caspian oil via Georgia to the Turkish port of Ceyhan, which is the main oil pipeline route supported by the US government. The United States has pushed oil companies to conclude a deal to build a pipeline from the Caspian Sea to the Turkish port of Ceyhan. Azerbaijan has been trying to persuade its Central Asian neighbours, Kazakhstan and Turkmenistan, to commit themselves to a cross-Caspian pipeline that will join the Baku-Ceyhan pipeline, thus making it more economically beneficial and efficient. If this proposal materializes, Azerbaijan’s geopolitical and geo-strategic importance will increase even further.

Turkey has been put centre-stage by this US plan in three ways: First, Caspian oil would be passing through Turkish territory.

Second, in the manoeuvring to develop the Ceyhan pipeline, Turkey’s government and military has been assigned the task of infiltrating and politically influencing Azerbaijan and Kazakhstan.

Thirdly, the USA wants to reinforce the role of Turkey in the Central Asian states, to contain both Iranian and Chinese influence on economic and strategic interests in the region.[99]

Since the onset of the oilfield development project, economic factors have suggested that Azeri and Kazakh oil should be directed to world markets through Turkey. The projected oil terminal at Ceyhan is ideally located for export to European markets, at a cost estimated to be one-half of that estimated for exports out of the Russian Black Sea port of Novorossiysk. The Azeri government signed an agreement in Ankara in 1993 to export its oil through Ceyhan. The Kazakh government has also shown considerable interest in the Turkish route, though officially it has not declared its preference because of its involvement in the tortuous negotiations within the Caspian Pipeline Consortium (CPC). The Turkish government is hopeful that the two Turkic states, along with the oil companies involved, will opt for the Turkish route.

Right from the start, the major oil monopolies of the world had deep misgivings about the White House plan for a Baku-Ceyhan pipeline, which, on paper at least, they were expected to finance. Oil companies were concerned that the Baku-Ceyhan route was the most expensive of the routes proposed, possibly exceeding US$4 billion, almost twice the estimated cost of the Baku to Kharg route proposed by Iran. The oil companies were also concerned that the volume of oil passing through the Baku-Ceyhan route might not be enough to make it profitable, especially if oil prices stay low and other pipelines are also built in the Caspian region. In November 1998, Russia, Kazakhstan, and Chevron (the US oil company), agreed to build a $2 billion pipeline from Tengiz to the Russian port of Novorossiysk.[100] However, the US department of state has been a staunch advocate of Baku-Ceyhan oil pipeline.[101]

The Baku-Supsa pipeline is small and cannot carry the massive output expected by 2004, but it will handle much of the production until the Ceyhan pipeline is in place.[102] This new Supsa pipeline is especially useful in providing for the oil needs of the Ukraine and helping the USA pry the Ukraine further away from Russia. Finally, the Turkish government announced that they had discovered major environmental problems with letting huge oil tankers pass through the Bosphorus Straits, the mouth of the Black Sea, which they control. In other words, Turkey is threatening to stop oil tankers from Novorossiysk, which quickly made investors wary of building a pipeline that ends at Novorossiysk.

After all these developments, the only pipeline that seemed practical was the US-backed Baku-Ceyhan route. The oil companies and the Caspian oil-producing countries had been presented with ‘an offer they could not refuse.’ Because of the various roadblocks, a major pipeline for the Caspian Sea oil has not been constructed. Kazakhstan and Azerbaijan are using such intermediate solutions as transportation by barges: hardly a solution when the oil transported will require the construction of up to four high-capacity (1 million barrels per day) pipelines from the Caspian Sea region via Turkey to the Mediterranean Sea.

Turkey is desperate to diversify its sources of natural gas away from Russia, which currently supplies 85 per cent of its fast-growing needs, and would like to import 10 billion cubic metres of natural gas per year over 23 years from Iran. No pipeline for this purpose is yet being constructed or financed. However, as a part of its multi-route strategy, the United States supports Turkey in providing its territory with a pipeline that would terminate at the existing oil port of Ceyhan. Turkmenistan could have been an alternative for Iranian gas. In general, the difficulties in building a pipeline under the Caspian Sea are considerable, in part because of the ongoing conflicts over the legal status of that body of water.[103]

In November 1999, many government representatives gathered in Istanbul for a conference of the Organization for Security and Co-operation in Europe (OSCE); by then, the US government had simply forced the key regional governments to give the oil companies the guarantees and finances they wanted. A new agreement was finally possible: The governments of Turkey, Azerbaijan, Georgia and Kazakhstan agreed to officially back the Baku-Ceyhan route.

Turkey’s government promised to pay all construction costs over $1.4 billion for the Turkish pipe segment. This meant that the Ceyhan route was suddenly as inexpensive for the oil companies as the Iranian route would have been.

Kazakhstan promised that it would send 20 million tons of oil a year through a new, proposed, underwater pipe to Baku, and from there on to Ceyhan.

In short, the western oil companies were guaranteed protection from cost over-runs, and were guaranteed that the Ceyhan pipeline would, presumably, materialize from the wealth of these regions. The plan is to have this new pipeline ready by 2004, when huge new oil installations now being built in the Caspian region are expected to start sending one million barrels a day to Ceyhan. The Istanbul agreements opened the door for the multi-billion-dollar fundraising for the Baku-Ceyhan pipeline.[104]

Iran provides a unique land bridge, connecting two very important regions–the Caspian-Central Asian region and the Persian Gulf region. This geopolitical position has had an immense influence on Iran’s global and regional policies as well as on the policies of other powers toward these two regions. Iranian policy-makers, however, do not appear to have formulated, as yet, a clearly defined strategy for maximizing the influence of Iran’s unique geographical position, between two of the most important energy-rich areas on earth. Iran’s evolving strategies, still somewhat vague, have not yet brought home to the international community the fact that Iran’s territory is geographically and economically the most logical and most sensible route to oil and gas pipelines from the region.

Iran’s existing gas pipeline networks are already connected to Azerbaijan and are within a short distance of Turkmenistan. A pipeline connecting Kazakhstan and Turkmenistan to this network would be at least four times shorter in length and much less expensive than any of the proposed lines to other outlets such as the Black Sea and the Mediterranean.[105] The alternative networks would, moreover, have to pass through mountainous areas, where various ethnic groups are involved in political struggles against one another as well as against national governments in the region. Considering this fact, the security situation of the trans-Caucasus line seems the safest.

Iran signed an agreement with Turkmenistan on 30 January 1995, whereby Turkmen oil would first be transported to Iran overland and then piped to the Iranian refineries close by. It would then be exported to distant destinations through Iran’s Persian Gulf ports. In fact, the first consignment of 3,200 tons of Turkmen oil was reported to have been shipped on 1 February 1995 to the northern Iranian port of Bandar Noshahr for onward transit for export. Other companies operating in Central Asia are also reported to be attempting to transport crude through Iran to the Persian Gulf.[106]

Iran’s hopes with regard to the geopolitics of oil pipelines are being hampered by the enforcement a rigid US policy of containment against Iran’s expanded involvement in the region. This American stance does not seem to be based on the merit of economic developments in the region: Uzbekistan was the only state in the region which subscribed to the US declaration of economic sanctions against Iran. Although some Uzbek officials contradicted others by denying reports that the republic endorsed US sanctions against Iran, the Uzbek republic would welcome constructive Iranian policies in Central Asia.

This pipeline route was proposed in 1995 when Turkmenistan, Afghanistan, and Pakistan signed a memorandum of understanding to pave the way for its construction. Later, the instability in Afghanistan created hurdles in its execution, causing construction to be shelved.

After the fall of the Taliban, the leaders of Afghanistan, Pakistan and Turkmenistan, Hamid Karzai, General Pervez Musharraf, and Saparmurat Niyazov signed a memorandum of understanding to proceed with the feasibility study for the construction and financing of a gas pipeline from Daulatabad in Turkmenistan via Afghanistan to Pakistan. The cost of this pipeline is estimated between US$2 billion to $3.5 billion. The gas pipeline, 1500 kilometres long, will have a capacity of 15 to 30 billion cubic metres a year.[107] 740 kilometres will be in Afghanistan, 200 in Turkmenistan, and 600 in Pakistan.[108] The Turkmen President Niyazov also invited Ukrainian President Kuchma to attend the talks on the construction of the proposed pipeline, but the Ukrainian president declined.[109]

Turkmenistan’s President Niyazov is very enthusiastic about the construction of the Pak-Afghan-Turkmenistan (TAP) gas pipeline. He sent a letter to the UN leaders, advocating the construction of a pipeline carrying Turkmen gas to Pakistan’s Arabian seaports, through Afghan territory. Seeking UN support for the project, Niyazov contended that this pipeline ‘will help rebuild this country [Afghanistan], normalise peaceful life and work of the Afghan people, and also accelerate socio-economic development of the entire adjacent region’.[110]

The country most likely to suffer from the possible construction of pipelines in Afghanistan is Russia, currently a leading member of the anti-terrorism coalition, and a long-time sponsor of the Northern Alliance. Moscow has long been wary about the development of new Central Asian oil and gas export routes that bypass its territory.

If the trans-Afghan gas pipeline project is realized, experts in Moscow say the Russian economy will face two unpleasant consequences. Firstly, the Russian energy sector will lose the Turkmen gas that is now being delivered to Russia and, in the long-term perspective, also Uzbek gas. That could amount to 25 billion cubic metres annually. Secondly, if Central Asian gas exports are directed south, across Afghanistan to the Indian Ocean, Russia will lose substantial transit revenues.[111]

President Saparmurat Niyazov is trying to reduce the opposition to this proposed route, and make it acceptable to all the parties vying for energy domination. The parties involved in the energy politics of the Central Asian region may oppose this pipeline project as it directly hurts their economic interests. It provides the CAS an alternative, cost-effective pipeline option. While working in this direction, the Turkmen President has invited Russian companies to participate in the construction of the proposed pipeline, to reduce the opposition to the project.[112] He also invited Ukraine to supply equipment for, or participate in, the construction of the planned pipeline.

The fundamental question facing the planners of the pipeline is the identification of serious clients to make the venture commercially viable. Pakistan, India, and Japan may be among the potential clients. Assuming that a 48-inch diameter pipe is used for the main artery, the capacity of the pipeline can be raised to as much as 40 bcm under optimum conditions. For the time being, the planners will be content to muster enough clients for 15 bcm. Pakistan has a mature gas market and, according to figures released by the ministry of petroleum and natural resources, annual consumption is approximately 20 bcm. More than 800,000 new users are likely to come on line by 2004. Even then, the Pakistan market may absorb only 1-2 bcm at best from the trans-Afghan pipeline. This leaves the planners with 13-14 bcm to dispose of elsewhere to make the pipeline commercially viable.

India can be another major client. Zawya, an Arab energy group based in London, reports that, at present, India is using only about 26 bcm of gas annually. Expansion of the gas market in India is not constrained because of a lack of buyers; there simply is not enough gas available in India. If progress on the project continues at the present pace, the practical phase of TAP will begin in July 2003 and, by the end of 2005 or by mid-2006, the pipeline should be in place. By that time, India will need 11-14 bcm of additional gas to meet its growing requirements. This demand can be met by connecting to the trans-Afghan pipeline. Pakistan has offered unconditional use of its territory to extend a branch of TAP to India. India has still has some reservations about this offer, but if India buys about 11-14 bcm and Pakistan 1-2 bcm, the pipeline becomes commercially more feasible.[113]

Japan has recently given a very strong signal that it is willing to buy gas from the trans-Afghan pipeline. A Japanese delegation, led by their vice foreign minister, visited Ashgabat and said in no uncertain terms that Japan was willing to enter into negotiations for the trans-Afghan pipeline. A delegation of Japanese experts will visit Ashgabat in March 2003 to sign a document for purchasing gas from the Turkmen-Afghan-Pakistan pipeline. If Japan buys three million tons of condensed gas per annum, the pipeline can take a healthy start at 20 bcm right away, assuming that India and Pakistan together can buy about 15 bcm.[114]

Keeping in view all these developments, it appears that economic imperatives and the will of the people of the region have finally coalesced to establish the pipeline firmly and irrevocably on the South and Central Asian landscape.

Central Asia has always enjoyed an important position in Asian politics and in world history. It has been mentioned in many historical documents that the Silk Road passing through Central Asia was the traditional trading route between Central Asia and the Indo-Pakistan subcontinent since ancient times. Most of the foreign rulers in the South Asian region came along this route.

Strategically, Pakistan and Central Asia are important to each other, as only Pakistan can provide the CAS with a comparatively cheaper and shorter outlet for its natural energy resources and its trade to the outside world through the ports at Karachi, Port Qasim, and Gwadar. Pakistan, in return, stands to benefit in many ways, ranging from economic gains to strategic advantages from the region. Pakistan’s economic co-operation with the countries of this region will create for it an image of a progressive and responsible partner in the Islamic world. That image will support its due political role in promoting peace and stability in the region, by turning Pakistan into a major energy export route in fully functioning condition. It would lift its international status and help it solve its domestic economic and social problems. As an export route, Pakistan’s importance for the international energy market could cause the world to manifest deeper interest in its stability and security. Pakistan’s interests in the Central Asian region can be categorized thus:

Since independence, there has been a perceived threat to Pakistan from Indian’s hostile designs. These security concerns have compelled Pakistan to look for some kind of strategic depth on its northern and western borders. For this purpose, in the Cold War era, Pakistan developed friendly relations with Iran and China. After the disintegration of the USSR, Pakistan found an opportunity to establish good relations with the CAS as a counterweight to the Indian threat.

Pakistan’s most serious concern is the ever-present threat to its territorial integrity from across its eastern border. Since the country lacks strategic depth, most of its population centres and industrial establishments are within striking distance of enemy weapon systems. The main rail and road networks lie very close to the international border. With only one fully functional port available to Pakistan for the supply of essential wartime needs, the country is extremely vulnerable to a naval blockade by the India. An alternative source for the supply of essential goods by land routes in areas safe from Indian attack would go a long way towards improving the strategic position of Pakistan.

India’s coercive and hostile policy towards Pakistan makes it imperative for Pakistan to seek some kind of a strategic arrangement with its Muslim neighbours to the west. While the CAS should not be expected to come to Pakistan’s assistance in the event of a conflict with India, friendly ties with them would impose some kind of caution on the Indian leadership, as they are equally interested in forging friendly ties with those countries.

Another area of strategic interest is the arms trade. Pakistan wants to diversify its sources of weapon supply. Some of the Central Asian states have large amounts of Soviet-era military equipment, which they are contemplating disposing of, to earn much-needed foreign exchange. The Pakistani procurement agencies could look towards this possibility as well.

The Central Asian republics are in the process of forming their own national armies. Though they will most probably maintain Soviet-style military organization and doctrine, many of them would like to benefit from western systems as well. Offering to sponsor candidates from the CAS for courses in Pakistan’s military institutions would help in building a closer relationship with the armies of these countries. For closer co-operation, special arrangements may have to be made, as language could prove to be a problem. Pakistan has acquired a fair amount of experience in the production of defence equipment, albeit it is so far in light weaponry only. Defence experts can discuss the possibilities of co-operation in this field.

Over time, as regional co-operation develops, this could alter the strategic configuration in favour of Pakistan, making up for its vulnerabilities.[115] Pakistan has certain expectations that the new states of Central Asia are able to ensure: strategic depth in the area of defence. Besides, through bilateral ties and multilateral regional formations like the ECO (Economic Co-operation Organization) Pakistan could render technical and economic assistance to the Central Asian countries to enhance intra-regional stability.[116]

In terms of geography, history, and economic potential, the area extending from Turkey eastwards to Pakistan, and southwards from Central Asia to the Arabian Sea constitutes a region where co-operation and integrated development appear natural. The Economic Co-operation Organization, which originally comprised three countries–Turkey, Iran and Pakistan–has been expanded to include Afghanistan and the six Muslim republics of the former Soviet Union. It is now the second biggest regional organization after the European Community (EC), with the potential for making a significant contribution to the development and prosperity of member countries. As a founding member of the ECO, Pakistan attaches great importance to the role the grouping could play in promoting stability and progress in a sensitive part of Asia, and it expects the Central Asian republics to give new meaning and direction to its goals and activities.

The newly independent republics share a feeling of affinity and kinship with Pakistan, since they retained Islamic links as the badge of their distinctive cultural identity throughout the years of Soviet rule. They have emerged as a group of countries with which Pakistan can develop significant co-operation in many areas. They are geographical neighbours of Pakistan, and once stability comes to Afghanistan, Pakistan will expect to provide the most convenient outlet to the sea to these landlocked countries.

· Not to promote the narrow interests of any regional state over those of others; i.e., Pakistan will seek not to create regional or local surrogates.

· To ensure, through political means as well as financial, the construction of a pipeline from Turkmenistan to Gwadar.

· To extend its influence in the region by way of new economic and political alliances.

· Engagement of China, Europe, Turkey, the USA, and Central Asia in an area of mutual interests of the region.

· Pakistan’s short-term interest is to maintain dependable access to the region, without being drawn into regional conflicts. Pakistan’s access to the Central Asian region requires first and foremost a stable geopolitical order.

· Promotion of internal stability of the Central Asian states, with the assurance that the region will not be divided into spheres of influence by other regional powers; it is essential to ensure the the rivalry of regional powers is minimized.

The independence of these states threw open the whole region for the world to explore opportunities and secure their political and economic interests. Due to its historical, cultural, and religious connections, Pakistan also welcomed the independence of these states. With the advantage of historical ties, circumstances seemed more favourable for Pakistan to promote economic, scientific, cultural, political, and other links. Besides, Pakistan has acquired unique status in providing transit trade facilities to these landlocked states. In this regard, Pakistan demonstrated a great degree of enthusiasm and willingness to establish avenues of co-operation. ‘However, different factors particularly instability in Afghanistan have hindered the efforts made by Pakistan and these states turning the region into a greater economic zone’. [117]

For Pakistan, access to wheat, cotton, and natural gas and oil constitute strategic priorities. Though presently self-sufficient in wheat, Pakistan does at times need to import the grain to meet its domestic requirements. Wheat, as well as a variety of minerals, can be obtained from Kazakhstan. When its cotton crop is below expectations, Pakistan can import this commodity from neighbouring Central Asia. In 1994-6, the Cotton Export Corporation imported 31,000 tons of cotton from Turkmenistan at favourable rates. Pakistan should certainly import cotton from Tajikistan and Uzbekistan. Even when its own crop is good, it can purchase higher quality cotton from this region for value-added exports and to stabilize the market.[118]

Pakistan has assigned high priority to economic co-operation in its relations with the Central Asian states. In this regard, Pakistan has taken many steps, including the development of bilateral trade in raw materials and manufactured goods and the opening up of communication links and contracting for regular power supplies.

Pakistan perceived substantial benefits for industrial growth in obtaining regular suppliers of surplus power through gas and electricity grid schemes or through future oil supplies from Tajikistan, Turkmenistan, Kazakhstan, and Uzbekistan. Efforts have also been made to set up banking and insurance companies as well as stock markets, joint-venture capital, and import-export ventures.[119]

The Indus river, via Afghanistan, has provided a warm-water sea outlet to adjacent parts of Central Asia during various historical epochs under the Indian, Persian, Turkic, Mughal, and British empires. The Indus Basin corridor, as a north-south land-sea transportation route facilitator, enhances the significance of Pakistan in the expansion of future gas/oil pipeline routes toward South Asia and remains vital for Central Asia and China. The term ‘corridor’ was conceptualized during the 1992 Quetta conference of ECO foreign ministers, in an attempt to partly change the status of the landlocked state of Central Asian republics. In March 1995, China, Pakistan, Kazakhstan, and Kyrgyzstan signed an agreement for the construction of the Almaty-Karachi roads, connecting Central Asia with the Arabian Sea. In addition to the north-south route via Iran, a new road link via the Chinese region of Xinjiang and the Pakistani Karakoram Highway was proposed. A rail and road network, connecting Almaty, Bishkek, and Kashgar to Islamabad and the Pakistani seaports of Karachi and Gwadar offered a relatively viable alternative to other routes. Economic and political concerns about the politics of regional passage, road construction, renovation of the Karakoram Highway, and the problem of individual country traffic permits delayed the project; but these issues have since been resolved. Agreement on traffic permits has been reached: China will operate with 1,000 vehicles, Kazakhstan initially with 100, and Kyrgyzstan with 300 permits. A trial trade convoy from Pakistan sent last winter reached Almaty in time and returned safely.

Pakistan has made an offer to Tajikistan to join this quadruple arrangement through the Kulma-Murghab link, but the Tajik government has yet to respond. In time, with peace prevailing in Afghanistan and Tajikistan, the Almaty-Karachi road/railway networks are likely to be extended and linked through other Afghanistan-Pakistan routes surrounding the Bolan, the Gomal, and the Khyber passes, and Pakistan’s Northern Areas. This would allow Turkmenistan, Uzbekistan, and Tajikistan to trade through the Arabian Sea, the entrance to South and Southwest Asia and the Middle East, with distances reduced by approximately 1,200-1,400 kilometres. Diplomatic circles and government officials in participating countries value the importance of the Almaty-Karachi road and related link roads as economically cost-effective, and relatively safe and uncontested, compared to other currently turbulent routes.[120]

Moreover, the possible normalization of India-Pakistan relations in the near future could convert the Indus Basin into a commercial corridor between Central Asia and the South Asian subcontinent.

Given the continuing disturbances in Afghanistan, alternative corridors have an important role to play in relieving transition problems and allowing Central Asia new opportunities to develop trade in various directions. The Almaty-Karachi road is likely to open up new commercial vistas for regional participants as well as other countries. The then finance minister of Pakistan, Mr Shaukat Aziz, announced on 17 June 2002, that the project for building a rail link from Dalbandin via Panjgur to the Gwadar deep-sea port with Chinese co-operation, had renewed the prospects for an alternative land-sea trade outlet for Central Asia through Pakistan via the Indus Basin corridor. The entire project would be completed in two phases and cost would approximately $142 million. It could stretch approximately 3,200-3,400 kilometres from Almaty and Bishkek to Kashgar, from where it is already linked to Islamabad through the Karakoram Highway; it will then be linked to the Karachi and Gwadar seaports through already established as well as some newly planned road and railway networks.[121]

The leaders of Afghanistan, Pakistan, and Turkmenistan have agreed to revive interest in the construction of a 890-mile long, $2 billion gas pipeline, once initiated by Unocal, proposed as the ‘Centgas’ pipeline. This pipeline would connect the gas fields of eastern Turkmenistan through Afghanistan to Pakistan’s Arabian Sea coast.

· Development and diversification transportation corridors to and from the region to facilitate trade on a secure basis, especially in energy and minerals.

· An ‘open-door policy’ is in Pakistan’s interests in terms of strong economic and political relations.

Pakistan has, from the beginning, emphasized the economic dimension of its relationship with the Central Asian states. It is ready to offer them its seaport facilities, access to Pakistani markets on a reciprocal basis, and training in moving to a free-market economy. Pakistani officials have stated that they want to build an economic bloc with Central Asia. That is the reason why Pakistan, along with Iran and Turkey, offered the CAS membership of the Economic Co-operation Organization (ECO).[122]

According to statistics available on imports and exports between Central Asia and Pakistan, the trade ratio is not high; in fact, it is quite low by international standards. Though both can enhance import and export, without political will and planning, this is not possible. Trade with Uzbekistan, Kazakhstan, Turkmenistan, and Tajikistan is, however, increasing gradually. Pakistan and Central Asia can start barter trade to save their foreign exchange. A glance at the statistics on imports from Central Asia shows that Pakistan is not importing a single commodity to Kyrgyzstan.

An eminent economist has said that Central Asia can provide Pakistan with educated human capital. On the other hand, Pakistan can provide the CAS help in infrastructure and technological development. To boost bilateral trade, Pakistan needs to conclude trade agreements, including provisions for tax exemptions, on a reciprocal basis.[124]

It is said that nations have no friends but interests. The Central Asian republics are the El Dorado of Asia, because of their proven and potential energy resources. Like other regional countries and world powers, Pakistan must make concerted efforts to obtain maximum economic benefits from this region. There is no avoiding the fact that Russia has influence on the CAS in the political and economic spheres. In addition, Iran and Turkey have historical and cultural ties with these states. Moreover, the US military presence in the region disturbs the balance of power in Central Asia. Furthermore, political and economic instability at within the Central Asian Republics are also hurdles in establishing good relations.

An analysis of the potential of Central Asia and the prospects for Pakistan reveal some hard realities. Conflict over the sharing of the Caspian Sea oil and gas reserves, pipeline-route politics, and the political turmoil in Afghanistan compel Pakistan to adopt Fabian tactics.

To turn constraints into opportunities, Pakistan’s leadership needs to have a comprehensive perspective on the Central Asian countries and work out a multi-phased strategy.

In the first phase, Pakistan should develop good diplomatic ties with these states and create an amicable atmosphere in the whole region. In the second phase, transit trade and pipeline routes, as well as other related facilities, should be provided to these landlocked countries. This can only be done if Pakistan improves its own infrastructure and makes the required political moves in the region. In the third phase, Pakistan can initiate lasting ties in Central Asia, by undertaking both individual and joint ventures in all economic fields. These could include establishing business and trade houses, banks, insurance groups, professional services, and helping towards the development of an infrastructure of roads. Pakistan can assist by extending expertise in the field of free-market economy, management, and financial institutions. At the same time, war-ravaged Afghanistan should not be overlooked. Maintenance of peace in Afghanistan is of utmost important for maximizing the beneficial economic prospects for both Pakistan and the CAS.

Under the present circumstances, Pakistan can persuade the USA and the European Union to donate a portion of their abundant resources towards resolving the Afghan problems on a permanent basis. Both these economic powers can support the war-torn country by:

· Assigning the powerful warlords a subordinate role in the reconstruction of Afghanistan;

· Expanding the role of the international peacekeeping force to the entire country;

The majority of the ruling elite in Central Asia comprise former leaders and members of the Communist Party. Historically, Pakistan did not have very cordial relations with the Soviet Union, and this factor can play a role in creating mistrust and misunderstanding between the governments of Central Asia and Pakistan.

Ethnic Russians are a major part of the ethnic composition of Central Asia. They are influential in decision-making bodies, and owing to historical legacy of Indian-Soviet relations, their approach towards regional policies is pro-Indian. They also consider Pakistan responsible for the disintegration of the Soviet Union, as Pakistan was the major player in the war against the Soviets in Afghanistan. Ethnic Uzbeks, Tajiks, Kazakhs, Kyrgyz, and Turkmen were an important component of the Soviet army in Afghanistan.

As the Central Asian states are successors to the Soviet Union and the Soviets had cordial and friendly relations with India, most of their governments feel more comfortable dealing with India. On the issue of the Taliban and Muslim terrorism, they were allies helping each other in dealing with the situation during the Taliban era. India is active in Central Asia, with a special interest in trying to undermine Pakistan’s interests. Pakistan needs to be vigilant where Indian activities in the region are concerned, and to work out strategies to counter them effectively.

On the issue of the Taliban, Pakistan-CAS ties were strained. The latter considered the Taliban as a threat to their governments, while Pakistan was regarded as the godfather of Taliban. This legacy distorted relations.[125]

Now, after the ouster of the Taliban, Pakistan needs to re-establish relations with the CAS. This requires calculated spadework. According to an American scholar, Tajiks will take time mending fences with Pakistan as they believe that Pakistan was responsible for funding the ‘United Tajik Opposition’, which sparked and fuelled the civil war in their country from 1990-2000.[126] The Tajiks accused the Taliban of providing training, arms, and logistical support to the UTO. On the other hand, Tajiks are culturally and historically very close to Pakistan. According to a famous historian, many Pakistanis are descendants of people who migrated from Tajikistan several hundred years ago. Concerted efforts by Pakistan can wipe out mistrust and lead to the development of strong ties with them. [127]

During an interview, an American expert on Central Asia said that a few years ago in Bukhara, Uzbekistan, Pakistanis were called ‘foes’. This attitude had been fostered by Pakistan’s support for the Taliban, who were promoting the ‘Islamic Movement of Uzbekistan’ (IMU).[128] Now the situation has changed and, with a little effort, ties with the Uzbeks can be improved, bringing great economic and political benefits.

Kazakhs and Krygyz will accept Pakistan easily as they were not direct victim of Taliban activities. Pakistan can start improving its relations with these two countries (see the next chapter).

Being a neutral country Turkmenistan has always had normal, good relations with Pakistan. The Turkmen government is very keen on constructing a gas pipeline through Pakistan. They have developed bilateral relations with Pakistan. Some Turkmen military personnel are receiving training in the military institutions of Pakistan. Pakistan can extend this facility to other Central Asian states as well.

As seen above, Pakistan’s support for Taliban put its interests in Central Asia at stake. Pakistan is tied with the region in close cultural bonds. Now it needs to promote these relations. Exclusive reliance on the use of the ‘Islamic card’ or slogans like Islamic brotherhood will damage these relations further.

Pakistan should not be involved in any conflict with any actor in the region. Without disturbing other’s interests it needs to secure its own interests. Central Asian states only mean and need business. By offering them cost-effective, secure and reliable alternatives, transit trade routes and oil and gas pipeline routes, we can achieve our interests. CAS want the world to recognize them on an individual basis not as a single entity.

At the moment the prospects of economic cooperation are quite bleak. Pakistan has adopted a two-fold policy for improving its economic relations with Central Asia: economic co-operation by improving bilateral relations with each state on individual basis; economic co-operation through the common platform of various organizations, such as ECO, OIC, CICA, etc.

The first policy, of improving bilateral relations first and then establishing economic co-operation, will be effective, if implemented strictly. There are a few examples of bilateral agreements, such as the recent Turkmenistan-Pakistan-Afghanistan agreement on the pipeline route. Pakistan can pursue this strategy to enhance is prospects.

The second strategy, that of economic co-operation, is not feasible, as at present, the economic organizations of the CAS are not working effectively and some of them are not dealing with economic co-operation at all.

Pakistan can get more through its trade with CAS than merely letting itself be used as a gateway to the region. Even to become a dependable and adequate gateway, it has much to do in the way of developing its road and railway systems and its seaports. Safe land routes are essential and law and order has to be improved immensely, so that there is no diversion of the imported goods or cargo by criminals. However, a great deal of investment capital is required for the implementation of these suggestions.

One analyst has suggested that the region has a potential annual market of US$ 80 billion; even if Pakistan secures only 5 per cent of that market, it could earn up to US$4 billion per year–about equal to Pakistan’s current total annual exports.[129] The opening of the Almaty-Karachi road, as well as of roads connecting Quetta, Bishkek, Mirpurkhas, Osh, Faisalabad, and Shikarpur are likely to reduce the current cost of imports (via Iran) greatly; white almost certainly boosting the volume of trade.

If Central Asia has so much potential, then Pakistan has bright prospects though it lost many opportunities in Central Asia due to the Afghan civil war. Pakistan also has to keep in mind that it lacks the technology and the capital required for the exploitation of energy resources, i.e., to be a major player in the Great Game. The greatest competition Pakistan faces is from Turkey. Both are competing for the same goal of CAS transit routes; both have invested in infrastructure development and mended their fences with Central Asia and presented themselves as the best option available.

The greatest obstacle to Pakistan’s Central Asian ambitions is lack of direct access to the region. The shortest route is the Karakoram Highway from Rawalpindi through the Chinese region of Xinjiang to Almaty. There are three railheads on the Pakistan side: one each near Peshawar and Quetta facing Afghanistan, and one terminating inside Iranian Baluchistan at Zahidan.[130] The Wakhan strip can be used as the Pak-Central Asian border, but insurgency and warlordism in Tajikistan are big hurdles. Air routes between Pakistan and Central Asia, dating from May 1992, are insufficient and expensive for trade.

There is vast scope for economic co-operation between Central Asia and Pakistan: Kazakhstan is rich in petroleum, iron ore, and other minerals; Uzbekistan has large gold deposits and it is a major cotton producer; Tajikistan has large aluminum deposits; Turkmenistan has large reserves of natural gas. Pakistan can import all this and, in return, can offer assistance in the area of textiles, hotel industry, banking, insurance, drugs and pharmaceuticals, non-conventional sources of energy, and agriculture. Pakistan can also offer education and training facilities to Central Asian students, journalists, and diplomats. What it needs is a long-term strategy to play an influential role in the region.

Undoubtedly, Central Asia abounds in natural resources and there is a great opportunity for Pakistan to profit from these landlocked states by providing them transit and port facilities for trade with the outside world. But that does not mean that it will be an easy task, as all the five states still have strong economic and political links with Russia. Russian influence in the region is so pervasive that it is indeed an uphill task for any country to get a foothold in the region. Furthermore, the ongoing instability in Afghanistan has greatly undermined Pakistan’s prospects.

A balanced system of relationships with the USA, Western Europe, Russia, China, Turkey, Iran, and other Muslim countries is vital for the internal stability of the Central Asian region. According to the leaders of the CAS, Afghanistan is the real source of instability as, until recently, it had been actively supporting Central Asia’s Muslim fundamentalists in their conflicts with their respective governments.

Another phenomenon influencing the situation is the rivalry between Russia, the USA, Iran, and Turkey–a two-tier rivalry. All the four countries are endeavouring to undermine each other’s influence, while seeking to increase their own. The relationship between Pakistan and Turkey may open up new opportunities for both countries in securing the future stability of Afghanistan, the independence of the CAS, and the improvement of trade links with the CAS. An extraordinary opportunity beckons Turkey.

However, Iran and Turkey have an edge over Pakistan in their competition to establish their influence in the region. While the former has geographical contiguity with the region, the latter has strong historical and ethnic links with the Central Asian states. Moreover, Turkey is spending heavily to outplay the other contenders. Pakistan, on the other hand, lacks sufficient resources. Another disadvantage for Pakistan is its strained relations with Russia. As Pakistan was actively involved in supporting the Afghan resistance against the Soviet army in the 1980s, a sizeable chunk of the ethnic Russian population of the Central Asian states is not favourably disposed towards Pakistan.

For Pakistan’s policy-makers, the recommended course is to develop relations individually with each of these states. Pakistan must endeavour to convince the leaders of these states that it provides them the best possible outlet towards the Arabian Sea. At the same time, Pakistan should emphasize the traditional and historical links with the region. Its declared policy should be the cultivation of durable relations with Central Asia on the basis of joint ventures, including the establishing of business and trading houses, banks, insurance groups, and professional services. It is essential that the rail and road infrastructure between Pakistan and Central Asia be developed rapidly for any economic progress to be possible. The region’s states are badly in need of foreign investment and there is an opportunity for Pakistan to gain influence in the region by making substantial investment.

Below are some recommendations, which could serve to further improve Pakistan’s economic, political, and social relations with the CAS.

· Pakistan can establish bilateral relations with each Central Asian state on individual basis. All of them are following independent foreign policies and want the world to recognize them on the basis of their individuality. The geography, economy, populations, ethnic composition, and resources of all of these states are different from each other.

· Pakistan does not have to wait for peace and stability to return to Afghanistan, before providing transit and pipeline routes to the CAS, and can make a start by improving bilateral trade with the CAS.

· Pakistan should look for multidimensional options to get maximum benefits from Central Asia.

· Pakistan should not get involved in any conflict, or side with any party involved in the conflict. It should not act as a mediator to solve ethnic conflicts.

· For Central Asia, Pakistan should evolve a neutral and non-aligned foreign policy, based on non-interference and non-intervention. Such a policy will serve its interests better.

· Pakistan’s policy should be based on ‘friendship with all, enmity with none’.

· Pakistan’s relations with regional states should be based on common international perceptions and economic and political interests.

· The Economic Co-operation Organization (ECO) should be made more effective by ensuring its active involvement in the economic development of Central Asia.

· Initially Pakistan can offer the CAS trade routes with minimum transit tariff rates. This cost-effectiveness will strengthen Pakistan’s position in any trade-route competition.

· PIA can start direct flights to all Central Asian states on a regular basis. It needs to develop air transport facilities that meet international standards.

· In order to promote foreign investment in each state, chambers of commerce, stock exchanges, and banks should be established to provide professional guidance needed by the business communities; Pakistan should then work in collaboration with the institutions of these countries.

· Pakistan can promote barter trade with each country in the region on a bilateral basis. It can make a list of goods available in Central Asian states at cheaper rates. The CAS would probably be willing to co-operate in this kind of trade as they desperately want to reduce their dependency on the Russian Federation in every sense.

· Under the banner of various regional organizations, such as the ECO and CICA, Central Asian states and Pakistan can establish various research centres, which will facilitate economic progress and will help in conflict prevention as well. There should be frequent exchange of visits of scholars, cultural representatives, and government officials to develop better mutual understanding. Such an exchange can be established on a regular basis, under sponsorship from the respective governments or by NGOs.

· Pakistan can establish cultural centres in the cities of the CAS, to promote cultural ties and commonalities between Central Asia and Pakistan.

· Pakistan can offer scholarships to Central Asian students in various fields. This will be helpful in building strong ties at non-governmental level. People-to-people interaction is helpful in strengthening bilateral relations. On return to their countries, these students will be ambassadors of goodwill for Pakistan.[132]

· Pakistan and the CAS can co-operate with each other to promote their tourist industries. The exchange of tourists will improve people-to-people relations.

· Pakistani NGOs can start various human development projects in collaboration with Central Asian governments or NGOs for the improvement of human conditions in Central Asia.

· Pakistan’s research institutes can co-operate with their counterparts in Central Asia. It will create mutual understanding between policy-making institutes.

· Completion of various plans for the improvement of transport infrastructure is of utmost important so that Pakistan can put itself forward as the best available option for any transit route for Central Asia.

· Expansion and improvement of the existing railway network is essential for better transportation of goods at cheaper rates. Though it will cost more, it should be accorded greater priority, as it will mean a quantum increase in rail traffic and goods.

Source: The Military Balance, 2002-2003, The International Institute for Strategic Studies, p. 131,132.

Annex B

The Armed Forces of Uzbekistan in 2002: Statistical Data

Source: The Military Balance, 2002-2003, The International Institute for Strategic Studies, p. 137

Annex C

The Armed Forces of Kyrgyzstan in 2002: Statistical Data

Annex D

Source: The Military Balance, 2002-2003, The International Institute for Strategic Studies, p. 136

Annex E

The Armed Forces of Tajikistan in 2002: Statistical Data

Source: The Military Balance, 2002-2003, The International Institute for Strategic Studies, p. 136

Source: Central Asia, Turkmenistan Energy Center, Energy
Information Administration, May 2002, acquired from

Source: Central Asia:

Turkmenistan

Energy Sector, Energy
Information Administration, May 2002.acquired from
http://www.eia.doe.gov/emeu/cabs/turkmen.html

Kazakhstan Oil and Gas Production and Consumption
1992-2001

Source: Kazakhstan, Country Analysis Brief, Energy Information
Administration, Acquired from
<http://www.eia.doe.gov/emeu/cabs/kazak.html> on 21 August 2002.

Annex H

Uzbekistan’s Natural Gas Production and Consumption
1992-2001

SOURCE: Central Asia: Uzbekistan Energy Sector, Energy Information
Administration, acquired from <http://www.eia.doe.gov/emeu/cabs/uzbek.html>
on 21 August 2002.

[1] Beatrice F. Manz (ed.), Central Asia in Historical Perspective (Lahore: Vanguard Books, 1996) p. 47.

[2] Bradley Mayhew, Richard Plunket and Simon Richmond, Central Asia (London: Lonely Planet, April 2000) p. 15.

[3] Fasahat H. Syed and Nadeem Siddiqi, ‘Central Asia: A Historical Perspective’, National Development and Security (vol II, no.1, August 1993) p. 42.

[4] Bradley Mayhew, et al., op. cit., p. 69.

[5] Fasahat H. Syed and Nadeem Siddiqi, op. cit., p. 45.

[6] Ibid.

[7] Ahmed Hassan Dani, New Light On Central Asia, (Lahore: Sang-e-Meel Publications, 1997) p. 12.

[8] Ibid., pp. 12-13.

[9] Author’s unrecorded interview with Dr Ahmed Hassan Dani, on 24 August 2002, in Islamabad.

[10] Statement by Nurmurad Durdayev in International Seminar on Central Asia, Area Study Centre, Peshawar University, Peshawar, 7-9 October 1997.

[11] Mohammad Javad Omidvarnia, ‘Security in Central Asia and the Caucasus in the 21st century’, Amu Darya (Vol. 6, No. 10, Fall/ 2001) p. 395-396.

[12] M. Yahya Effendi, ‘Pakistan’s Prospects for Trade with the Central Asian Republics,’ Central Asia, no 37 (Winter 1995) p. 47.

[13] Bushra Hamid, ‘Pakistan’s Trade and Economic Relations with Central Asian

Republics: A Strategic Perspective’, Central Asia, No 48, (Summer 2001) p. 141.

[14] Ibid., pp. 141- 145.

[15] Fasahat H. Syed and Nadeem Siddiqui, ‘Prospects of Future ECO Relations Between Pakistan and Central Asian Republics’, National Development and Security (vol.III, no.1, August 1994) p. 85.

[16] ‘Major Factors Involved in Central Asian Republics’ Security and Prosperity’, paper presented at ‘International Seminar on Central Asia’ at the Area Study Centre, Peshawar: 24-26 March 1996.

[17] For further details, see Hafeez Malik (ed.), Central Asia, Its Strategic Importance and Future
Prospects (New York: St.Martin’s Press, 1994).

[18] For details of Kazakhstan army, men, and material, see Annex A.

[19] For details of Uzbekistan army, men, and material, see Annex B.

[20] For details of Kyrgyzstan army, men, and material, see Annex C.

[21] For details of Turkmenistan army, men, and material, see Annex D.

[22] For details of Tajikistan army, men, and material, see Annex E.

[23] Jed C. Snyder, After Empire, The Emerging Geo-politics of Central Asia (Washington. D.C:
National Defence University Press, 1995) p. 65.

[24] Ibid., p. 91

[25] Ibid., p. 103

[26] Dr Azmat Hayat Khan, ‘Central Asia: Geo-Strategic Survey,’ Central Asia Journal, No 48
(Summer 2001), p. 48.

[27] For further details see, Moonis Ahmar (ed.) Contemporary Central Asia (Karachi: Dept of International Relations, Karachi University), 1995.

[28] This term is used by Dr Aftab Kazi, of the Johns Hopkins University, in one of his articles. He combined ‘geo-political’ and ‘geo-economic’, coining the new word.

* For the details of production and consumption of oil in Central Asia, please see, Annex S, F, G, and H.

[29] Author’s unrecorded interview with Dr S. M. Rehman on 24 July 2002, in Rawalpindi.

[30] Laurent Ruseckes, ‘Energy & Politics in Central Asia And The Caucasus’, Access Asia Review,
Vol.1, p. 4.

[31] Sitaram Yechury, ‘America, Oil and Afghanistan,’ The Hindu, 13 October, 2001.

[32] Andrei Shoumikhin, ‘Economics stet Politics Of Development of Caspian Oil Resources,’ Perspectives on Central Asia, (Vol. 1 no. 8, No. 8, November 1996). Retrieved on 12 August 2002, from <http://www.cpss.org/casianw/novpers.html>

* For technical details of proven and possible oil and gas reserves in Central Asia, please see
Annex I, J and K.

[33] ‘Central Asia: Turkmenistan Energy Sector, Energy Information Administration,’ Retrieved
on May 24, 2002, from <http://www.eia.doe.gov/emeu/cabs/turkmen.html>

[34] Ibid.

[35] Ibid.

[36] Constantine Arvanitopoulos, ‘The Geopolitics of Oil in Central Asia,’ retrieved on 20 August 2002, from

<http://www.hri.org/MFA/thesis/winter98/geopolitics.html>

[37] ‘Kazakhstan’, Country Analysis Brief, Energy Information Administration, retrieved on
10 August 2002, from < http://www.eia.doe.gov/emeu/cabs/kazak.html>

[38] ‘Central Asia: Kyrgyzstan Energy Sector’, Energy Information Administration, retrieved on
10 August 2002, from http://www.eia.doe.gov/emeu/cabs/kyrgyz.html>

[39] ‘Central Asia: Tajikistan Energy Sector’, Energy Information Administration, retrieved on
10 August 2002, from <http://www.eia.doe.gov/emeu/cabs/Tajik.html>

[40] ‘Central Asia: Uzbekistan Energy Sector,’ Energy Information Administration, retrieved on
10 August 2002, from <http://www.eia.doe.gov/emeu/cabs/uzbek.html>.

[41] Ibid

[42] Dr. S. M. Rehman (ed.), op. cit., p.98.

[43] NIS-Environmental Problem in NIS/CEEC, UN Economic Commission for Europe, Central Asia: Environmental Assessment, Fourth Ministerial Conference, Arhus, Denmark, 23-25 June 1998.

[44] Ibid.

[45] ‘Central Asia: Kyrgyzstan Energy Sector,’ Energy Information Administration, retrieved on 10 August 2002,
from <http://www.eia.doe.gov/emeu/cabs/kyrgyz.html >

[46] ‘Central Asia: Tajikistan Energy Sector,’ Energy Information Administration, retrieved on 10 August 2002, from, <http://www.eia.doe.gov/emeu/cabs/tajik.html>

[47] ‘Central Asia: Turkmenistan Energy Sector,’ Energy Information Administration, retrieved on 10 August 2002, from

< http://www.eia.doe.gov/emeu/cabs/turkmen.html >

[48] ‘Central Asia: Kazakhstan Energy Sector,’ Energy Information Administration, retrieved on
10 August 2002, from

< http://www.eia.doe.gov/emeu/cabs/kazakh.html >

[49] Ariel Cohen, U.S. Interests In Central Asia, United States House of Representatives,
Washington, D.C: 17 March 1999. Retrieved on 17 August 2002, from <www.heritage.org/library/testimony/test031799.html>

[50] Dr. S. M. Haider, Pakistan and Central Asian Region (Lahore: Progressive Publishers, 1994), p. 286.

[51] Ali Banuazizi and Myron Weiner, New Geopolitics of Central Asia and its Borderlands (London: I.B Tauris Ltd, 1994), p. 220.

[52] It was mentioned by various eminent scholars at the ‘International Seminar on Comparative
Security in South, West and Central Asia’, 29 August 2002, in Islamabad.

[53] Ajay Patnaik, Central Asia Between Modernity and Tradition, (New Delhi: Konark Publishers
(Pvt) Ltd, 1996), p. 40.

[54] Dr Sultan Khan, A Study of International Relations (Lahore: Famous Books Ltd, 1999), p. 101.

[55] Samuel P. Huntington, The Clash of Civilizations and the Remaking of World Order (New York: Touchstone Books 1997), p. 208.

[56] For further details please see, Peter Hopkirk, The Great Game (London: John Murray Publishers, 1990).

[57] Gareth M. Winrow, Pipeline Politics and Turkey, A New Great Game in Eurasia? (Istanbul:
Istanbul Bilgr University, 1997), p. 26.

[58] Laurent Ruseckes, ‘Energy and Politics in Central Asia and the Caucasus,’ Access Asia Review,
vol.1, no. p.4.

[59] K. M. Asaf and Abul Barakat (eds.), Central Asia, Internal and External Dynamics (Islamabad:
Institute of Regional Studies, 1997), p. 29.

[60] Prof Marvin Weinbaum, ‘US Interests and Policies in Central Asia’, a paper presented at the International Seminar on ‘Comprehensive Security and Economic Prospects in South-West and
Central Asian Region’, on 28 August 2002, in Islamabad.

[61] William H. Curtney, ‘US policy on Caspian Energy’, Central Asia Note, 4 February 1998, p.1.

[62] Ihsen Clock, ‘American Asian Relations,’ Eurasian Studies, vol. 3, no. 3 (Fall 1996), p. 68.

[63] Anoushiravan Ehteshami ve Emma C. Murphy, ‘The Non-Arab Middle East States and the Caucassian/Central Asian states: Iran and Israel’, International Relations, vol. 12, no.1 (April 1994), p. 103.

[64] US Policy in Central Asia, Hearing Before the Subcommittee on the Middle East and South Asia of
the Committee on International Relations, House of Representatives of the107th Congress, 6 June 2001, serial no.107-201. Retrieved on 23 August 2002, from http://commdocs.house.gov/committees/intlrel/hfa72975.000/hfa72975_0.HTM#2

[65] The Russian Federation adopted this policy in 1993 It means an area which is abroad but due to historical, security, strategic and political ties it is near to Russia and important for the security of the Russian federation.

[66] Dinshaw Mistry, ‘India, Pakistan and Central Asia,’ ACDIS, University of Illinois,18 August 1998.

Retrieved on 28 August 2002, from <www.ipcs.org/issues/articles/133-ifp-dinshaw.htm>

[67] Amin Saikal, (ed.) Russia and Central Asia in Search of its Future, (Cambridge:

Cambridge University Press, 1995), p. 142.

[68] ‘Russian oil exports to rise’, retrieved 2 September 2002,

< http://www.atimes.com/c-asia/oil.html >

[69] A paper presented by a Russian scholar, Arten Rudnitsky, at an International Seminar on ‘Comprehensive Security and Economic Prospects in South-West and Central Asian Region’, 29 August 2002, at Islamabad.

[70] Eugene Novikov, ‘Russia’s Long-term Interests in Central Asia: Concerns Over the Rights of Russian-Speaking Populations in Central Asia,’ Central Asia Journal, no 45, pp. 184-186.

[71] Mousa Al-Reza Vahidi, ‘GUUAM and the CIS: The Challenges and Opportunities of the Russian Foreign Policy,’ Amu Darya, vol. 6, no. 9 (Summer 2001), p. 228.

[72] For further details please see, D. S. Adel, China and Her Neighbours, (New Delhi: Deep and Deep Publishers, 1995).

[73] John Calebrese, ‘China’s Policy Towards Central Asia: Renewal and Accommodation,’ Eurasian Studies, (no. 16, 1999), p. 83.

[74] A meeting with Zhai Dequan, deputy secretary general, China Arms Control and Disarmament Association, on 27 August 2002, in Islamabad.

[75] Ibid.

[76] Naveed Ahmed Tahir, (ed.) European Union-Asian Relations in the 21^st Century: Problems,
Prospects and Strategies (Karachi: B.C.C.T Press, 2001), p. 315.

[77] Dr S. M. Rehman, (ed.) Central Asia: Regional Cooperation for Peace and Development
(Rawalpindi: FRIENDS, 1998), p.127.

[78] Naveed Ahmed Tahir, op. cit.

[79] ‘The Organization for Security and Co-operation in Europe’ (OSCE) is the new nomenclature of the Conference on Security and Co-operation in Europe (CSCE). With 54 member-states, the OSCE is
involved in conflict-resolution in Europe and the Caucasian region.

[80] Dr S. M. Rehman, Sohrab Shahabi (eds.) Pakistan, Central Asia and the Region: Prospects for
Future, (Rawalpindi: Progressive Publishers, 1994), p.21.

[81] Ali Banuazizi and Myron Weiner, op. cit., p. 69.

[82] Dr. S.M Rehman (ed.), op. cit., p.87.

[83] Ibid.

[84] Ibid.

[85] Dr. Aftab Kazi, ‘Transit-Routes Politics And Central Asia’s Indus Basin Corridor,
’ Central Asia-Caucasus Analyst, the Johns Hopkins University, 4 July 2001, retrieved
on 30 August 2002, from
<http://www.cacianalyst.org/July_4_2001/July_4_2001_TRANSIT_ROUTE_POLITICS.htm>

[86] Asma Shakir, ‘Indo-Pak Competition in Central Asia,’ Pakistan Observer, Islamabad: 29 August 2002.

[87] Asma Shakir, ‘Indo-Russian and Iranian Collaboration in Central Asia’, Pakistan Observer, Islamabad:
8 August 2002.

[88] Dr. Aftab Kazi, ‘Is The Proposed Russia-China-India Pipeline Feasible’, the Johns Hopkins University, Central Asia-Caucasus Analyst, 3 July 2002, retrieved on 30 August 2002, from <http://www.cacianalyst.org/2002-07-3/20020703_RUSSIA_CHINA_INDIA.htm>

[89] Spotlight on Regional Affairs, vol. XIX, no. 10, October 2000, (Islamabad: Institute of Regional Studies), p. 2.

[90] Azmat Hayat Khan, ‘Pipeline Diplomacy in Central Asian Region: Costs and Benefits’, at an International Seminar on Confidence-Building Measures Between Pakistan, Russia and Central Asia, Peshawar: 8-9 November 2000, p.17.

[91] Ibid., p. 18.

Annex B

The Armed Forces of Uzbekistan in 2002: Statistical Data

Total Armed Forces

Equipment

Helicopters

Paramilitary

Source: The Military Balance, 2002-2003, The International Institute for Strategic Studies, p. 137

Annex C

The Armed Forces of Kyrgyzstan in 2002: Statistical Data

Equipment

Main battle tanks (MBT)

Reconnaissance (RECCE)

Armoured Infantry Fighting Vehicles (AIFV)

Armoured Personnel Carrier (APC)

TOWED ARTY

Self propelled artillery

Combined Gun/MOR

Multiple rocket Launchers (MRL)

Mortar (MOR)

Anti-talk guided weapons (ATGW)

ATK guns

AD guns

Paramilitary

Annex D

Equipment

The Armed Forces of Tajikistan in 2002: Statistical Data

Gross Domestic Product (GDP)

Defence Budget:

Equipment

Opposition forces

Foreign Armed Forces

Equipment

Source: The Military Balance, 2002-2003, The International Institute for Strategic Studies, p. 136

Kazakhstan Oil and Gas Production and Consumption
1992-2001

Annex H

Uzbekistan’s Natural Gas Production and Consumption
1992-2001

Annex B

The Armed Forces of Uzbekistan in 2002: Statistical Data

Total Armed Forces

Equipment

Helicopters

Paramilitary

Source: The Military Balance, 2002-2003, The International Institute for Strategic Studies, p. 137

Annex C

The Armed Forces of Kyrgyzstan in 2002: Statistical Data

Equipment

Main battle tanks (MBT)

Reconnaissance (RECCE)

Armoured Infantry Fighting Vehicles (AIFV)

Armoured Personnel Carrier (APC)

TOWED ARTY

Self propelled artillery

Combined Gun/MOR

Multiple rocket Launchers (MRL)

Mortar (MOR)

Anti-talk guided weapons (ATGW)

ATK guns

AD guns

Paramilitary

Annex D

Equipment

The Armed Forces of Tajikistan in 2002: Statistical Data

Gross Domestic Product (GDP)

Defence Budget:

Equipment

Opposition forces

Foreign Armed Forces

Equipment

Source: The Military Balance, 2002-2003, The International Institute for Strategic Studies, p. 136

Kazakhstan Oil and Gas Production and Consumption 1992-2001

Annex H

Uzbekistan’s Natural Gas Production and Consumption 1992-2001

Kazakhstan Oil and Gas Production and Consumption
1992-2001

Uzbekistan’s Natural Gas Production and Consumption
1992-2001