Recently, Beijing played host to senior officials from Turkmenistan to discuss ways to enhance their energy cooperation. The Turkmen-Chinese Cooperation Committee (TCCC) – and its more significant subcommittee on energy – forms the backbone of China’s energy cooperation with the gas-rich Central Asian state. The talks were expected to focus on the exploitation of the Central Asia-China Pipeline that is slated to transport 65 billion cubic meters of natural gas from Turkmenistan to China annually.
Turkmenistan continues to be China’s principal supplier of natural gas as a result of the pipeline which traverses through Uzbekistan and Kazakhstan. For a host of geopolitical and security reasons, the pipeline continues to squeeze out Tajikistan and Kyrgyzstan as transit countries which is an overt diplomatic affront in an insecure region. This complicates Beijing’s ability to engage with both countries which – unlike Turkmenistan and Uzbekistan – share a border with China. However, symbolic of Central Asia’s constant geostrategic wrangling, Kyrgyzstan and Tajikistan have now indicated that they are looking to leverage a proposed natural gas pipeline from Iran that would transit through Afghanistan and eventually to China.
The Iran-to-China pipeline has the potential to accrue significant benefits for Tajikistan and Kyrgyzstan. First, it allows both countries to reduce their dependence on natural gas imports from Uzbekistan and Kazakhstan. Dushanbe and Bishkek are particularly keen to reduce their reliance on Uzbek gas given Uzbekistan’s often arbitrary restrictions on its energy exports. Relations between the three countries have been acutely strained in recent years over terrorism and drug trafficking concerns. Second, the pipeline would allow both Tajikistan and Kyrgyzstan to profit from hefty transit fees from what essentially would be an energy pact between Iran and China.
Despite this, the Iran pipeline is fraught political and security risks. First, the international climate – underpinned by a series of UNSC sanctions – makes doing business with Iran financially and legally challenging. Both countries will have to make a cold calculus to determine whether the benefits of the project outweigh the costs. Moreover, aside from the need to circumvent UN sanctions, Tajikistan and Kyrgyzstan risk alienating their relationship with the U.S. which both countries depend on as an economic and strategic counterweight to Russia.
While NATO has announced the International Security Assistance Force mission in Afghanistan will end in 2014, there should be no illusions that the U.S. intends to abandon its interests in the region. Actually, the end of the mission will no doubt coincide with increased U.S. pressure on Afghan’s neighbors to support a post-NATO Afghanistan. There is already significant evidence of this as the U.S. successfully lobbied in 2009 to renew its lease with Kyrgyzstan for the strategic air transit center in Manas despite domestic resistance and external interference from Moscow. Furthermore, U.S. Assistant Secretary of State Robert Blake recently announced Washington was holding preliminary discussions with Kyrgyzstan over continuing to have access to Manas after 2014. The U.S. is also pouring diplomatic and security assets into Tajikistan with hopes to bring it on side.
Aside from political ramifications, the Iran-to-China pipeline is currently overwhelmed by a lack of security guarantees in the region. The planned route would cover thousands of kilometers in Afghanistan which, at best, carries the heightened risk of attacks on its critical infrastructure by the Taliban and its proxies. The worst case scenario has the country slip back into civil war post-2014. The plan also faces significant geographic hurdles as it would traverse remote mountainous terrain and be at risk of earthquakes.
China seems to recognize the challenges of the Iran pipeline. While it has actively supported the proposal, it has thus far refrained from investing beyond political gestures. Before expending serious capital, Beijing likely would have to see an appreciable change in the international political environment with Iran as well as positive signs that Afghanistan can tend to its own house. It also remains possible that China is trying to hedge its support in order to secure leverage in its gas negotiations with Turkmenistan and potentially Russia.
These factors elevate the importance of the Central Asia-China pipeline from Turkmenistan. In June, Turkmenistan’s national gas company, Turkmengaz, inked a cooperative framework agreement with the China National Petroleum Company to increase the transport of natural gas to China. The current pipeline design only has a capacity for 30 billion cubic meters – less than half of the amount promised in the new agreement. This is a shrewd move by both sides. Turkmenistan benefits from doubling its energy supply to China and circumventing its biggest competitors – Iran and Russia. Beijing also wins as it is able to increase its position in energy negotiations with Russia and postpone plans with Iran until the political climate improves.