DUSHANBE, February 22, Asia-Plus – On Thursday February 22, the Government of Tajikistan and the Asian Development Bank (ADB) signed a loan agreement for a project to tap Tajikistan”s power surplus to meet shortfalls in neighboring Afghanistan.
Finance Minister Safarali Najmuddinov, signed the agreement for the Government, while Neeraj Jain, ADB’s Country Director in Tajikistan signed on behalf of ADB.
Following the agreement-signing ceremony, Najmuddinov told journalists that the project will construct a 220 kV double circuit transmission line that will link the hydropower stations on Tajikistan”s Vakhsh River to the border town of Sherkan Bandar, then to Kunduz, Baghlan, Pul-e Khumri and, ultimately, Kabul in Afghanistan.
The minister added that a total project cost is $109 million. “Of this amount, $54 million will be spent in Tajikistan,” the minister said, adding that Tajikistan is supposed to enlist services of other financial institutions for this project as well.
The ADB’s Country Director Neeraj Jain, for his part, noted that ADB”s loan of US$21.5 million comes from its concessional Asian Development Fund and carries a 32 year term, including a grace period of 8 years. Interest is charged at 1% per annum during the grace period and 1.5% during the rest of the term.
Other financiers of the project are the OPEC Fund for International Development ($8.5 million), Islamic Development Bank ($10.0 million), and Tajik power holding Barqi Tojik ($14 million).
Barqi Tojik is the executing agency for the project, which is due for completion in June 2010.
The project also includes new investments and upgrading in Tajikistan that will help reduce the winter power deficit by boosting the available level of generation and decreasing technical losses in the south of the country resulting in an additional 320 gigawatt-hours annually, according to the head of the ADB Resident Mission in Tajikistan.
Tajikistan”s annual generated capacity is 4,405 MW, most of which comes from hydropower. An annual surplus of about 1,500 gigawatt-hours is available for export, but only for about half a year during the spring-summer period. Part of the surplus is already exported through Uzbekistan via its southern grid while the rest is not utilized.
Afghanistan, on the other hand, faces serious power supply shortages, which are expected to become more acute as demand grows. Its power generation, transmission and distribution systems have been severely damaged by years of conflict. All around the country, including the capital Kabul, power is available for just a few hours a day.
According to Najmuddinov, at present a number of energy investment project for total amount of $470 million are being implemented in Tajikistan. “Besides, 14 joint projects of Tajikistan and ADB for a total amount of $234 million are currently under consideration,” the minister said.
