August 26, 2011: Russia has agreed to supply Afghanistan with over 500,000 tons of petroleum products a year (about 20 percent of annual needs), via railroad lines reaching the Afghan border in Uzbekistan and Turkmenistan. Afghanistan has only 75 kilometers of rail line, from the Uzbekistan border to the city of Marzar I Sharif. This line was completed a year ago, and more such rail lines are planned. Afghanistan is one of the last nations on the planet to build a nationwide rail network. Russian wants some of that business. Russia has also offered to upgrade and expand electric transmission lines in northern Afghanistan.
The Russians also want to ship other goods into Afghanistan, but this will require that some road projects be completed first. Russia is competing with Pakistan to be the main transportation outlet for the landlocked nation. Currently about a third of fuel comes from Iran, and the rest via Pakistan.
Meanwhile, thefts from U.S. supply shipments (via the Pakistani port of Karachi, thence by road north) to Afghanistan, and Pakistani threats to cut this supply line, has led to something the Pakistanis do not like. Over the past few years, the U.S. and NATO have been bringing in more supplies via the north. Now, about 40 percent of supplies are arriving via the "Northern Distribution Network". The U.S. is rushing to move 75 percent of cargo via the northern route by the end of this year, and all of it within a year. It took five years to negotiate unfettered transit rights for NATO military cargo via Russian and Central Asian railroads. This will cost Pakistani port and transportation firms over $100 million a year, and greatly reduce the theft.
The Afghanistan government, and most Afghan businessmen, sees the "Northern Distribution Network" as a potentially cheaper and safer way to get goods into and out of the country.