Uzbekistan to open airspace to US military; Kazakh-Turkmen-Iran railway to be in operation this year; Turkmenistan military to hold first Caspian naval drills; Uzbek and Kazakh leaders to discuss regional security; Lukoil discoveres a sizable gas reservoi
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    • According to reports, Uzbekistan’s upper house of parliament has adopted a bill that would open up air corridors over Uzbek territory for use by U.S. forces in Afghanistan. The agreement stipulates that Uzbekistan will designate special air corridors for U.S. airplanes carrying personnel and goods intended to ensure the security and reconstruction of Afghanistan. Aircraft will not be allowed to land except in the case of an emergency or due to other unavoidable reasons. 1

    In another development, reports noted that the railway project between Kazakhstan, its gas-rich southern neighbour Turkmenistan and Iran is set to be in operation by the end of this year. The railway covers 561 miles, with the bulk of the railway running through Turkmenistan (434 miles). Seventy-four miles of track will be located in Kazakhstan, while Iran will host 58 miles of the railway. 2

    Turkmenistan has announced plans to launch the country’s first ever tactical military exercises in the Caspian Sea in early September. The drills involving both military and law enforcement units will be called Khazar-2012 (‘Caspian-2012’). 3

    According to reports, security concerns in Central Asia and Afghanistan and economic issues are likely to top the agenda when Uzbek president Islam Karimov visits his Kazakh counterpart Nursultan Nazarbayev in the first week of September. The US withdrawal of troops from Afghanistan from 2014 onwards, recent violence in Tajikistan’s Badakhshan province, Islamic militant activity in Central Asia, natural gas pipeline to China and electricity grid issues are likely to be the key drivers for the talks. 4

    In other developments in the region, Russia’s second largest oil and gas firm Lukoil has said that it has discovered a sizeable reservoir of natural gas in the mountains of south Uzbekistan. Well testing at the gas and condensate field on its South-West Gissar block has resulted in flow rates of as much as 650,000 cubic meters of gas and more than 77 tons of gas condensate per day. 5

    Reports noted that energy, transport, and communications topped the agenda of the visit to Tajikistan by Germany’s Federal Minister for Economic Cooperation and Development Dirk Niebel. The two sides also discussed the political and social affairs in Afghanistan and their impacts on Central Asia and beyond. 6

    Kyrgyzstan’s acting premier Omurbek Babanov has said that he expects the Central Asian state’s gross domestic product (GDP) to grow by 9.8 percent in 2013 with the projected budget deficit amounting to US$367.9 million or 4.8 percent of GDP. 7

    Kazakh authorities have said that the country will leave the regional energy grid it shares with Kyrgyzstan and Uzbekistan if a satisfactory agreement is not reached by 2013. The bone of contention is Uzbekistan’s alleged siphoning of power without actually paying for it. 8

    Reports noted that Tajikistan’s plans to acquire 30,000 tons of cut-price sugar from Pakistan, has hit a snag over who will pay the freight costs. Pakistan had agreed with Tajikistan to sell the sugar at $597.90 per ton, which is $20 below international rates. 9

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