THREE "IRAN-FREE" STEPS TO BRING TAJIKISTAN AND AFGHANISTAN

C O N F I D E N T I A L SECTION 01 OF 02 DUSHANBE 001469

SIPDIS

SIPDIS

STATE FOR SCA/CEN
EMBASSY MANILA: PLEASE PASS TO ADB AMBASSADOR SPELTZ

E.O. 12958: DECL: 8/2/2016
TAGS: PGOV PREL ECON ENRG TI AF IR
SUBJECT: THREE "IRAN-FREE" STEPS TO BRING TAJIKISTAN AND AFGHANISTAN
CLOSER

REF: A) Dushanbe 1434 B) Tashkent 1486

CLASSIFIED BY: Richard Hoagland, Ambassador, U.S. Embassy,
Dushanbe, State.
REASON: 1.4 (b),(d)




1. (C) The "Persian Language Summit" in Dushanbe July 26
highlighted the cultural and linguistic ties between
Afghanistan, Tajikistan and Iran, but also provided an
opportunity for the three presidents to declare publicly their
economic and energy ties (Reftel A). At the close of the press
conference, the Afghan and Iranian leaders expressed their moral
support for President Rahmonov's favorite mega-project,
Dhasti-Jhum, the proposed 4000 KW hydropower project on the
Pyanj River between Afghanistan and Tajikistan.


2. (C) While enthusiasm comes at no cost, the mere mention of
Dhasti-jhum in this tri-lateral context shows the Tajiks'
determination to find support for this project and others on the
Afghan-Tajik border. Whether Iran (or Russia) helps them
realize their hydropower plans will depend largely on whether
other countries step up to the plate first. The recent $600
million concessional credit agreement with China clearly
demonstrates that Tajikistan remains open to any and all
investors, particularly in the infrastructure and energy
sectors.


3. (C) Despite the Tajik political hype, outside experts
confirm Dhasti-Jhum has enormous potential for power and
irrigation: up to 4000 MW electricity for Tajikistan,
Afghanistan and South Asia; new agricultural areas with
increased irrigation; and better managed flood plains. But it
will take more than political will to make these benefits real.
Dhasti-Jhum, the largest of thirteen potential projects on the
Pyanj, can only be developed as a public-private partnership on
a cost recovery basis -- not through donations.


4. (C) We may have a real opportunity here to practice
transformational diplomacy. Just as the U.S.-funded
construction of the bridge at Nizhniy Pyanj between Afghanistan
and Tajikistan has become a concrete symbol for U.S. commitment
to promote South and Central Asian integration, so would
increased engagement in Pyanj River water and energy issues
demonstrate that Tajikistan and Afghanistan can further
strengthen their ties directly, without the involvement of Iran.


5. (C) The United States could play a leadership role, through
diplomacy and development, by supporting the following three
steps:

-- Formulating and funding a feasibility study of a hydropower
station at Dhasti-Jhum. The Tajiks have long shopped around the
idea of Dhasti-Jhum, but their plans are largely based on Soviet
studies. Recent U.S. experts visiting the site concluded the
project does indeed have merit and looked much more promising
than they had expected after reviewing the old Soviet papers.
Nothing would convince Tajikistan of our commitment to regional
stability and Tajik hydropower more than helping them flesh out
the details of this project. We cannot provide $600 million in
low interest loans -- but we could afford to help with the
initial studies on their flagship project.

-- Supporting a Bilateral Tajik-Afghan Committee for Energy
issues. The Afghans and Tajiks have already met on energy
issues in April, December 2005 and May 2006 (in Istanbul),and
signed various memoranda for joint cooperative agreement in the
energy sector. (By contrast, Ref B reports a bumpier energy

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relationship between Uzbekistan and Afghanistan.) We should
encourage Tajik and Afghan authorities to establish a
functioning working body that will discuss power issues and make
agreements that stick.

-- Activating the Bi-national Commission on the Joint
Development of Water Resources, as per the 1958 treaty between
Afghanistan and the Soviet Union. This bilateral commission
would be the first step in resolving water management issues.
A working level delegation from the Afghan Ministry of Water
will visit Dushanbe August 2-9, thanks to the coordinated
efforts of Embassies Dushanbe and Kabul. This visit should
start an ongoing Tajik-Afghan dialogue about water issues and
shared resources, and may lead to activation of the Commission.


6. (C) The United States has already been actively developing
regional energy networks, through the U.S. Trade and Development
Agency's June Istanbul conference "Energy Without Borders" and
USAID's Regional Energy Market Assistance Program. But more can
be done. The three steps above represent concrete and
confidence-building actions. Only by high-profile engagement on
issues important to the Tajik and Afghan governments can the
United States prove itself as an alternative-and less demanding
partner-than Iran.
HOAGLAND