Islamabad should convey Ashgabat to execute the TAPI Project
Due to the recent Ukraine crisis, Turkmenistan may redirect its gas supply to Europe, bringing the TAPI pipeline project to an end.
Ibn-e-Ameer
Pakistan and Turkmenistan have struggled for a long time to execute the Turkmenistan-Afghanistan-Pakistan-India (TAPI) pipeline project.
The project has been termed a peace pipeline to connect arch-rivals Pakistan and India through an energy corridor. It will also connect Central and South Asia, paving the way for other essential projects like fibre optic cables and railway lines.
However, the recent Ukraine crisis may hit this project, and Turkmenistan could redirect its gas supply to Europe, bringing the TAPI pipeline project to an end.
As a result, now is the time for Islamabad to send a message to Ashgabat stating that Pakistan is committed to the project and wants it completed as soon as possible.
The Afghan Taliban’s government currently requires a shift to stabilization to bring peace to the region.
As a result, this project will connect the Afghan Taliban government with other project participants, such as Turkmenistan and India, and bring prosperity to the war-torn country.
Significance of TAPI Project for Pakistan
This project also has significance for Pakistan.
Pakistan’s indigenous gas reserves are depleting fast. Since 2015, the country has been subjected to LNG imports. Qatar is a crucial supplier of LNG to Pakistan.
However, LNG imports are not a permanent solution for the country.
Different countries use it as a stop-gap measure by various countries to meet demand. The share of LNG supply in other countries has been almost 6 per cent.
In Pakistan, however, LNG imports have increased to 24% of the total energy mix.
Pakistan has recently learned that LNG imports are not a long-term solution after two LNG suppliers, Gunvor and ENI, failed to deliver despite having contracts with the state-owned Pakistan LNG Limited (PLL).
Furthermore, LNG prices have been extremely high, prompting widespread criticism of the PTI government. Due to high costs, PLL has not been able to arrange the required LNG cargoes during the recent winter season.
The TAPI gas pipeline costs about $7 per MMBtu, whereas the average LNG price is around $12 per MMBtu.
In this scenario, the TAPI pipeline project will provide Pakistan with significant energy security by supplying gas at lower prices.
Pakistan, Turkmenistan to make headway on TAPI Gas Prices Review
Moreover, due to tension in the region, LNG supply may face disruption, whereas Turkmen gas will be a constant supply source.
Source of tapping markets for textiles
Traditionally, Pakistan has depended on the Middle East, the United States (US) and EU countries for its exports.
There has not been any significant increase in Pakistan’s exports for the last several decades due to its dependence on traditional markets for exporting traditional products.
Pakistan’s traditional exports are in the textile sector.
Due to this project, Pakistan will be able to tap into untapped markets in Central Asia and even Russia.
Why Should Pakistan execute TAPI pipeline Project?
It will also allow it to diversify its exports by tapping into previously untapped Central Asian and Russian markets.
Gwadar Port Access to the Central Asian States
Pakistan has also struggled to make Gwadar Port fully operational, and handing it over to China was also part of this plan.
Central Asian countries have also expressed a strong desire to use Gwadar Port. The link between the two regions will aid in the speeding up of activities at Gwadar Port.
In light of this scenario, Islamabad should make every effort to complete the TAPI pipeline project as soon as possible to ensure its energy security.
Pakistan is to sign a host agreement on the TAPI pipeline project with Turkmenistan. The new government in Islamabad can expedite work on inking this agreement to kick off construction work.
