The Asian Development Bank (ADB) will provide $1.2 billion in grants to Afghanistan to support ongoing energy projects in the country, the bank announced on Monday.
The grants will consist of $750 million from ADB's Special Funds and up to $450 million from the Afghanistan Infrastructure Trust Fund - administered by ADB - according to a statement released by the bank.
'This assistance will support the government’s national energy supply program of more than $10 billion, which aims to expand power supply to boost economic growth and cut poverty,' Aleem added.
The funds will be provided to the country in multiple tranches which will start with $275 million in 2015. The payment plan for the remaining tranches is expected to proceed through to 2025, according to the statement.
With the first tranche in 2015, ADB will fund the development of a Turkmenistan-Afghanistan power interconnection. The development will include the construction of two transmission lines of over 360 kilometers in length.
'Insufficient energy supplies and a demand–supply imbalance constrain growth and income opportunities and create economic disparities that can fuel ethnic and regional tensions and insecurity,' said Asad Aleem, senior energy specialist in ADB’s Central and West Asia Department, in the statement.
From 2005 to 2012, Afghanistan's energy demand almost doubled due to its economic growth rate, the statement said. But, the country still receives around 80 percent of its total supplies from neighboring countries; Iran, Tajikistan, Turkmenistan and Uzbekistan.
By Ugur Serhan Ozcan
Anadolu Agency
ugur.ozcan@aa.com.tr