With the longest war in United States history politically winding down (with flag-draped coffin shipments showing weak to moderate growth) note that on Sept. 13, 2011, China’s high bid won the right to develop the oil fields of northern Afghanistan coupled with a pledge to build an oil refinery.
Australia came in second. Combined with its 2007 bids that won the right to develop copper deposits and pledges to develop a coal mine, a power plant, a smelter and a railroad, China is now the largest foreign investor in Afghanistan and the U.S. debt market.
Yes, the Chinese have no troops in Afghanistan and the Taliban still bristle at any foreign presence. So who shall provide security for the Chinese investments? Perhaps it is just an interest payment. Regardless, we fought a covert war to end Russian military domination of Afghanistan and an overt war that paved the way for Chinese economic domination of Afghanistan.
With American taxpayers building the already bankrupt Montana Alberta Transmission Line to deliver American taxpayer subsidized electricity to Canadian ratepayers, what could possibly be of interest in Gujarat, India, to the same taxpayers?
Solving the energy version of “which came first the chicken or the egg,” through the Asian Development Bank, the United States has approved $100 million to build a substation and transmission line in Gujarat, an arid region of India, so that if solar project developers develop solar projects the necessary infrastructure will be in place.
Yup, first you and I build the transmission lines, then we see if anyone wants to build generation. Solar power is among the most expensive energy sources in the world and India’s impoverished population cannot afford it. The solution is for India to subsidize solar power at a rate of 90 percent while U.S. taxpayers give foreign solar developers transmission lines and substations.
The externalities of the project are that the solar fields “may provide jobs for up to 100 poor women” and the power developers are asked to build a Sun Temple. Oh, the solar park is part of the climate mitigation plan of the government of India.
At a cost of only a million U.S. “stimulus” dollars per soon-to-be-employed Indian woman, how could we not join in? Of course we do not have $100 million, so will have to raise taxes or borrow same from China. The major producer of solar panels in that part of the world is China.
The U.S. is also partnering with Pakistan, for an undisclosed amount, to construct and upgrade three hydro plants (we are tearing down 100 hydro plants in the United States over environmental concerns) as well as three thermal plants (one will be diesel powered. Try getting that through the Environmental Protection Agency).
We have asked that Pakistan not use the Iranian natural gas and diesel delivered through soon-to-be-completed pipelines from Iran to Pakistan. They are giving it due consideration, which is good because Iran has in the last few months halted 1,900 diesel trucks at the Pakistani border to keep them from perhaps reaching Afghanistan. This way we can pretend our embargo of Iran is effective. Of course there is no other source of fuel supply for the power plants.
As announced, the undisclosed loan amount to Pakistan is expected to be paid back. Please note that in Lahore Karahi, capital of Punjab province, independent electricity producers are threatening to shut down generation if the 43 billion rupees owed for electricity sold since June 2011 is not brought current. Each month since June, a new deadline has passed and the government-owned utility has missed each payment deadline.
Not to worry about the loans you are guaranteeing though. The Pakistani government, during recent talks with U.S. energy officials, underscored its commitment to “strengthen energy sector governance and efficiency, pursue regulatory reforms, improve financial management, and create a business climate that drives investment.” Apparently it would be unwise of us to ask them to do this before giving them your money.
No longer needing to focus on shuffling Usama (pre mortem Osama) Bin Laden around to avoid our special forces, I’m sure Pakistan now has time to get its financial house in order and gladly repay the loans.
CAUTION: Any reference to this article during discussions on how to reduce spending to reduce the deficit will get you labeled a xenophobic, ungreen whack job.
(Note: The day after I wrote this, Lahore Karahi went on a 20-hour “load shedding” AKA: blackouts.)
Brad Molnar is a member of the Montana Public Service Commission.