Afghanistan can’t pay its biggest electricity suppliers

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International sanctions against the Taliban government in Afghanistan are also affecting the pockets of its Central Asian neighbours.

Uzbekistan and Tajikistan are unable to collect debts worth $100 million for electricity supplied to Afghanistan because Kabul cannot transfer the money, according to Afghan news agency TOLOnews reported May 18.

“We want to pay, but the problem is in the banks,” said Akhtar Mohammad Nusrat, spokesman for the Ministry of Energy and Water.

Afghanistan imports more than 80% of its electricity, at an annual cost of around $220 millionaccording to the Special Inspector General for Afghanistan Reconstruction (SIGAR), a watchdog agency created by the US Congress.

Uzbekistan is its largest electricity supplier. This year, about half of the electricity imported by Afghanistan comes from Uzbekistan and most of the rest from Tajikistan.

Both entered into long-term electricity supply agreements before the Taliban came to power, which are adjusted every year.

Uzbekistan is committed to providing Afghanistan with 2 billion kilowatt hours of electricity this year for $100 million. Tajikistan has pledged to provide 1.5 billion kilowatt hours for $69 million.

When, or if, they will get that money is anyone’s guess.

Nor Uzbekistan, which enjoys cordial relations with the Taliban, nor Tajikistan, which has do not turn off the lights on unpaid debts, fortunately for their neighbors on the other side of the border.

Any cut in electricity supplies from Central Asia risks leaving more than 10 million Afghans in the dark, according to the United Nations Development Programme, or UNDP. warned.

TOLOnews did not specify the amount of debt owed to each country, but the bulk is owed to Uzbekistan.

In January and February, the electricity company Da Afghanistan Breshna Sherkat, or DABS, made payments of $6 million in Tajikistan, on a debt of 33 million dollars at the beginning of 2022.

That hasn’t helped reduce the overall size of Afghanistan’s electricity debt to its two neighbors, which hasn’t budged from a whopping $100 million since the end of last year.

The procedures by which Afghanistan transferred the money to Tajikistan were not specified.

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Amanullah Ghalib, former head of DABS, blamed the war in Ukraine for creating complications in the banking process for Afghanistan’s neighbours, TOLOnews reported.

That may be the case, but the Taliban sanctions and the related problem of a severe shortage of government revenue are probably a bigger problem.

The Taliban “face severe revenue shortages that hamper the ability to supply the power grid with electricity generated both internally and externally”, SIGARE reported in January.

Late last year, UNDP directly linked Afghanistan’s unpaid electricity bills to the freezing of its assets, as well as a drop in international aid after taking office of the Taliban.

With this in mind, Uzbekistan has conducted calls the international community to unfreeze Afghanistan’s assets, to help alleviate the country’s humanitarian crisis.

By Eurasianet.org

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