On the heels of another significant investment in Central Asian infrastructure, the World Bank doled out an additional $200m to assist Uzbekistan Railways in the construction of a railway line that will traverse Kamchik pass in eastern Uzbekistan. The Bank is working hand in glove with Uzbek authorities in order to develop better rail infrastructure throughout the country. The recently-signed agreement is still subject to approval by the World Bank Board of Directors, whose authorization is expected to come as early as January of 2015. The loan will account for barely more than a tenth of the nearly $1.7b railway, which will add additional transit options for travelers as tourism booms within Uzbekistan. Chinese Railway Tunnel Group will contribute an additional $455m to the project, which will connect the Fergana Valley with the rest of Uzbekistan.
Uzbekistan has already invested heavily in its railway infrastructure, using the increase in spending on infrastructure to increase its tourism industry. Uzbekistan’s bullet train, the Afrosiyob, is currently the only extant bullet train in Central Asia, and connects the country’s capital, Tashkent, with the ancient city of Samarkand, which sat on the Silk Road, and which is the country’s primary draw in terms of tourist traffic. In a paradoxical set of policies, the Uzbek government has set out to increase its status as a destination for international guests while reducing the amount of freedoms its own citizens enjoy. Already strict internet security laws have been tightened, human rights abuses and government corruption are widespread, and the country is rumored to be going through an internal power struggle.
Direct investment from organizations such as the World Bank reflects Uzbekistan’s geographically crucial status, as it straddles the line between East and West. While once a Soviet republic, Uzbekistan has in the last several years served as a key ally of the United States and provider of supply routes that ended in Afghanistan. A recent cancellation of all Russian-dominated money transfer services coincided with the World Bank’s rail infrastructure grant, suggesting a possible quid pro quo.
- Mongolian Mining Corp. has been adversely impacted by the rapid drop in coal prices, and has as a result sought extensions on debt payment deadlines. The Mongolian producer and exporter of coal started as a greenfield project in 2008 and had grown incrementally over the past five and a half years. Recent difficulties can be ascribed to a surplus of the raw material and economic struggles in China, which to-date is the largest consumer of coal globally.
- Russian President Vladimir Putin has announced that he has begun to withdraw Russian troops from the Ukrainian border. The partial withdrawal comes amidst conflicting reports surrounding the Russian president’s motives. Former adviser Andrej Illiaronov, a former economic adviser to Putin from 2000 to 2005 stated that he believes Putin will not settle for the Ukrainian Crimea, and will instead move to overtake areas that in previous times either belonged to the Russian Empire under Nicholas II, or formed part of the Soviet Union.
- The World Bank approved a $526.5 million grant that will go towards an energy exchange project between Central and South Asia. The stimulus will serve to fund the much-debated CASA-1000 project that connects Afghanistan, Kyrgyzstan, Pakistan and Tajikistan, and which will consist of more than 1,200 kilometers (746 miles) of power lines. Infrastructure will be designed to transport surplus hydropower originating in water supplies. Power for the dam is expected to be at least partially galvanized by the controversial Rogun dam, which raises the question of whether or not tensions between Uzbekistan and Tajikistan over the dam’s potential implications will be rekindled.
- Kyrgyzstan is increasingly at risk of massive flooding provoked by global warming. Bishkek, the Kyrgyz capital, is found in a valley only 40 kilometers (25 miles) down from more than a dozen melt-water lakes. The lakes had previously been blocked by a natural ice-plug, but as the ice thaws, water is increasingly pouring into the nearby Ala-Archa river. As the ice continues to melt, the “…risk for catastrophic lake outburst… [i]ncreases.”