The Islamic Development Bank (IsDB) had agreed to provide USD 500 million loan to part-finance the USD 15 billion Turkmenistan-Afghanistan-Pakistan-India (TAPI) natural gas pipeline project.
IsDB has expressed interest in financing the project not just on Turkmenistan's territory, but in Afghanistan and Pakistan, too. The TAPI pipeline will have a capacity to carry 90 million standard cubic metres a day gas for 30 years. The project had been planned to become operational in 2018, but it is unlikely to see the light of day before 2022. The four nations to the project in April this year had signed an investment agreement in Ashgabad. The technical study of the TAPI project, done by Penspen, has estimated that it will take over six years to complete from the start of the FEED process.
The Islamic Development Bank (IDB) will take part in financing of the Turkmenistan-Afghanistan-Pakistan-India (TAPI) pipeline project. The estimated cost of the project will exceed $10 bn. The annual capacity of the gas pipeline will reach 33 bn cubic meters. It is planned that the total length of the TAPI pipeline will be 1,814 km. Some 214 km will pass through the territory of Turkmenistan, 774 km through Afghanistan, 826 km through Pakistan. The project is expected to be completed in late 2019.
It is possible that the Commonwealth of Independent States will become the next frontier for Islamic finance. At this point, six Muslim republics of the former Soviet Union, Azerbaijan, Kazakhstan, Uzbekistan, Turkmenistan, Kirgizstan and Tajikistan are members of the CIS. Moreover, Russia has also 20m indigenous Muslims in Russia, mostly concentrated in the semi-autonomous Caucasus provinces of Chechnya, Ingushetia, Dagestan, Tatarstan and Bashkortostan.
Although the relationship between Russia and its Muslims wasn't very good, it has started to make concerted efforts to reach out to Turkey, Iran and the Arab nations to the south and Pakistan, Malaysia and the Islamic democracies of South East Asia.
Mohammad Yahya Maroufi, secretary general of Economic Cooperation Organization (ECO), revealed that his organization has agreed to certify a bank to promote economic cooperation with banks in the Islamic countries.
He added that the plans include to open a trade market for its member states.
The ECO curent members are: Islamic Republic of Iran, Afghanistan, Azerbaijan, Kazakhstan, Kyrgyzstan, Pakistan, Tajikistan, Turkey, Turkmenistan and Uzbekistan.
The Islamic Corporation for the Development of the Private Sector (ICD), the private sector arm of the Islamic Development Bank Group, signed a Memorandum of Understanding (MOU) with the State Bank for Foreign Economic Affairs of Turkmenistan in Ashgabt, to promote mutual cooperation between ICD and the private sector particularly the small and medium enterprises (SMEs).
The MOU provides a general framework to facilitate cooperation in promoting economic development and emphasize priorities for joint action on accelerating private sector contribution to the country’s GDP especially in the financial, agricultural, logistics, affordable housing, services and manufacturing industries.
Through its member organization Islamic Corporation for Development of the Private Sector (ICD), the Islamic Development Bank (IDB) has started replicating the schemes tested in co-operation with Azerbaijan.
The IDB reports that ICD general manager Khaled Al-Aboodi and chairman of the State Bank for Foreign Economic Affairs of Turkmenistan Ragimberdi Jepbarov signed the Memorandum of Understanding (MOU) on development co-operation.
The Memo has a focus on the development of the private sector, especially small- and medium-size enterprises, financial sector, agriculture, logistics, construction of affordable housing, services and manufacturing industries. The IDB will also render technical assistance and consultations within the framework of Islamic financing.
Nine member countries have been approved to receive financing. They are Indonesia, Uzbekistan, Bangladesh, Pakistan, Sudan, Turkmenistan, Gambia, Mauritania and Albania.
The financing includes technical assistance in the form of grants for development projects in Benin, Chad, Togo, the GCC and grants and concessional loans for Sudan.
The approved financing also includes health and educational projects directed towards communities in non-member countries including Congo, Fiji, India and South Africa.
Turkmenistan prepares to establish the first investment company jointly with the State Bank for Foreign Economic Affairs of Turkmenistan and the Islamic Corporation for Private Sector Development. As Turkmenistan's Vice Premier Tuvakmamed Japarov reported at a government meeting on September 17, the main task of the investment company will be to revitalize activities related to direct investments in Turkmenistan through equity capital of small and medium-sized businesses enterprise.
Turkmenistan, Central Asia's largest gas producer, is getting $1 billion loan from a group of state-run funds from the GCC countries and the Islamic Development Bank (IDB), to finance infrastructure projects in the country, Reuters reported.
The Islamic Development Bank (IDB) granted a USD 31 mn facility to Turkmenistan to finance the purchase of two "river-sea" vessels with the capacity of 7 tons each for transportation of oil and oil products.