By Dr. Athar Zafar*
July 9, 2015
Prime Minister Narendra Modi has embarked on a visit to five Central Asian countries of Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan. For the Central Asian countries the visit was long awaited as it is for the first time that an Indian prime minister is visiting all the five republics in a single trip to the region. The visit has already generated much enthusiasm and expectations in the Central Asian countries because the experts and analysts from the region have long been demanding from India to increase its political, economic and cultural presence in the region.The new government in India has been placing greater emphasis on connecting with the countries in the neighbourhood. Prime Minister Modi is seen as a decisive leader and his foreign visits are focused, goal-oriented and executed well. He conducts diplomacy with extra vigour, leading to increased hope for concrete outcomes. Recently, India expressed its willingness to play a greater role in the regional Shanghai Cooperation Organization (SCO) grouping. SCO is evolving as an important forum to discuss and address the challenges faced by the region. During the visit the prime minister is scheduled to attend the BRICS Summit of Brazil, Russia, India, China and South Africa countries hosted by Russia and also expected to participate in the SCO meeting. It is also expected that India will get full membership of SCO at the Ufa summit
The Central Asian republics became independent in 1990s and since have made significant economic development. They are endowed with huge hydrocarbon resources, large amount of mineral deposits, extensive hydel power potential and vast stretches of arable land. Kazakhstan, the largest in size among the five republics and with the biggest regional economy of US$212 billion (WB, 2014), is the largest producer of uranium in the world, besides it has substantial oil and gas reserves. Tajikistan has huge hydropower potential and oil deposits. Uzbekistan also has oil and gas, and has significant gold deposits in the region along with Kyrgyzstan. Turkmenistan is among the countries with the world’s largest gas deposits. The total population of the region is more than 65 million and the combined GDP stands at more than US$ 335 billion.
Though the Central Asian countries are landlocked they have emerged as a bridge connecting different regions of Asia and linking Asia to Europe. Realizing their economic potential and geographical advantage, the regional countries are reforming their economies and integrating with the global economy. Kyrgyzstan and Tajikistan have joined the World Trade Organisation and after talks lasting for years Kazakhstan is now joining the global trade regime. The republics, especially those dependent on hydrocarbon, such as Kazakhstan, are diversifying their economies and looking for partners. India, which has been emerging as an economic power in recent years, with its US$2 trillion economy, is willing to play a greater and critical role and share its experiences with the Central Asian countries.
Over the years, India has established itself as a major player in Information Technology and IT enabled services and the services sector. The progress made in pharmaceuticals sector is also known across the globe. Similar is the field of agriculture and animal husbandry. The fast paced Indian economy is deficient in energy, which is available in nearby Central Asia in abundance. Despite the reciprocities, trade and economic engagement between India and Central Asia have been hampered by the lack of direct land access and dependence on a third country. However, this is expected to change soon.
Recently, Iran, Turkmenistan and Kazakhstan inaugurated a railway line connecting the three countries and the Caspian Sea to the Indian Ocean. India is also making investments in the Iranian port of Chabahar. Using this connectivity, which has already boosted regional trade, goods from India can reach Central Asia as well as Afghanistan through this alternative route. Absence of Indian banking facilities in many countries of Central Asia has also been affecting the trade between the two countries.
To meet its energy requirements, India’s OVL has a stake in the Satpayev oil block in Kazakhstan. The drilling from this block was launched during the visit of Prime Minister Modi to Kazakhstan. Another significant energy project is the Turkmenistan-Afghanistan-Pakistan-India (TAPI) natural gas pipeline from Central Asia to South Asia. It has been proposed for a long time but in recent times some positive developments have been observed; and during the prime minister’s visit to Turkmenistan, the project is expected to get a boost. The Eurasian Economic Union is emerging as a significant regional economic initiative. Kazakhstan and Kyrgyzstan are members of the group. India is interested in an agreement with group to further facilitate India’s trade with the region and the wider market.
The situation developing in Afghanistan, a common neighbour of South Asia and Central Asia, is a cause of concern for both India and Central Asia. The rise of Islamic State in Syria and Iraq and reports of many youths from Central Asia joining the group is another cause of concern as these developments can destabilize Central Asia. Hence, challenges posed by terrorism will be a major issue of discussion during the visit. It may be noted, however, that the societies in Central Asian countries are secular and unemployment is a major factor driving the youth to join terror groups unlike other regions where ideology is the driving force.
Focus on cultural connectivity has been an important part of Prime Minister Modi’s visits abroad. India and Central Asia have long historical and cultural ties, especially during the medieval period. Besides economic and political engagements, the visit of Prime Minister Modi to the region is expected to reinforce the cultural and people to people relations between India and Central Asia.
*Dr. Athar Zafar is a Research Fellow at the Indian Council of World Affairs. He can be reached at editor@spsindia.in
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