UNDP Central Asia Regional Water Strategy

UNITED NATIONS DEVELOPMENT PROGRAMME (UNDP)

Strategy and Project Activities to Support Improved Regional Water Management in Central Asia

July 2004

1 Table of Contents

List of Abbreviations...... 3

1. Overview...... ………...... 4 2. Water Management History and Current Issues in the Region...... 4 3. Regional Water Management Vision and UNDP Strategy…...….... 13 4. Project Components …...…...…...…....…...…....…...…....…...….... 15

Annexes…...... 26

2 List of Abbreviations

ADB Asian Development Bank ASBP-1 Aral Sea Basin Program, Phase 1 ASBP-2 Aral Sea Basin Program, Phase 2 ASBCDP Aral Sea Basin Capacity Development Project (UNDP) BCPR UNDP Bureau for Crisis Prevention and Recovery BVOs Basin Water Management Organizations CACO Central Asian Cooperation Organization CA-REC Central Asia Regional Environment Center CAREC Central Asia Regional Economic Cooperation forum (ADB and others) CIS Commonwealth of Independent States EBRD European Bank for Reconstruction and Development EC-IFAS Executive Committee of IFAS EEC Eurasian Economic Community ESCAP UN Economic and Social Commission for Asia and the Pacific EU European Union GEF Global Environment Facility HDR Human Development Report (UNDP) ICAS Interstate Council for the Aral Sea ICSD Interstate Commission for Sustainable Development ICWC Interstate Commission for Water Coordination IFAS International Fund for Saving the Aral Sea IsDB Islamic Development Bank OSCE Organization for Security and Cooperation in Europe MDGs Millennium Development Goals MOU Memorandum of Understanding NGO Non-governmental Organization RBEC UNDP Regional Bureau for Europe and the CIS RCF Regional Co-operation Framework (UNDP) RSC UNDP Regional Service Centre in Bratislava REAP Regional Environmental Action Programme SCO Shanghai Cooperation Organization SDC Sustainable Development Commission SIC Scientific Information Center SPECA ESCAP/UNECE Special Programme for the Economies of Central Asia TACIS EU Technical Assistance Programme for the CIS UN United Nations UNDP United Nations Development Programme UNECE UN Economic Commission for Europe UNEP United Nations Environment Programme UNICEF United Nations Children’s Fund USAID United States Agency for International Development

3 1. Overview

Improving regional water management in Central Asia is arguably the most important topic for active cooperation among the five former Soviet states, but it also is fraught with challenges. Most of the underlying water management problems that led to the ecological and social crisis associated with the shrinking of the Aral Sea have yet to be addressed. Added to these are new interstate differences between the downstream states (Kazakhstan, Uzbekistan and Turkmenistan) and their upstream neighbors (Kyrgyzstan and Tajikistan, and now to be added Afghanistan)—over the management of multipurpose dams in the upper reaches of the Aral Sea Basin.

This paper presents a strategy for UNDP’s contributions to improved Central Asian water management, with a special emphasis on transboundary rivers. It begins with a brief history of regional water management efforts since the countries of Central Asia achieved their independence from the Soviet Union, followed by a review of current water related international assistance activities in the region. It then goes on to describe six key issues or constraints to progress in this area. A vision and strategy is then presented for UNDP’s interventions to address the six problem areas.

2. Water Management History and Current Issues in the Region

2.1 Post-independence Transboundary Water Management in Central Asia

The short history of efforts to improve regional cooperation for transboundary water management since Central Asian independence is characterized by periods of great optimism and pronouncements of regional fellowship juxtaposed against times of inaction, indecision and quarrels over shared water resources. Most of the region gains its waters from the two great rivers of the Aral Sea Basin—the Amu Darya and the Syr Darya—though Kazakhstan has three other major transboundary rivers and several smaller ones that also require international efforts to manage.1 Creation of a vast and largely inefficient system of irrigated agriculture in mostly the downstream states was the root cause of the Aral Sea crisis. In the Syr Darya Basin—the main focus of the region’s current transboundary river management attentions—little has changed with respect to the irrigation infrastructure and management systems. The regional challenges in the Syr Darya Basin are exacerbated by upstream-downstream dependencies created by the Soviet era establishment of water storage capacity in what is now the territory of Kyrgyzstan and Tajikistan. The five former Soviet republics inherited a system of water and energy exchange for the Amu Darya and Syr Darya Basins that ensured adequate winter fuel supplies for the upstream states in exchange for the release of stored waters in the summer for downstream irrigation.

Upon achieving independence, the five states came together to codify the Soviet water allocation norms for the Aral Sea Basin in a 1992 agreement that also formed the Interstate Commission for Water Coordination (ICWC) together with its Scientific Information Center (SIC- ICWC). In 1993 they created the first Aral Sea Basin Program (ASBP-1), and in 1994 signed the Nukus Declaration—laying the groundwork for an influx of international aid to address the immediate humanitarian crisis in the Aral Sea Disaster Zone and to evaluate and address the root causes of the Aral Sea Basin water management crisis. The International Fund for Saving the Aral Sea (IFAS) was formed and emerged with a fresh mandate in 1999 as the lead institution for implementation of the ASBP-1.

1 See the map of Central Asia in Section 2.2 and listing of Central Asia’s transboundary river basins given in Annex 1.

4 EU-sponsored efforts to develop new interstate agreements through SIC-ICWC for long- term and integrated management of the Aral Sea Basin unfortunately proved unsuccessful—never getting past general discussions of draft agreements. This was due to wariness among the states about their respective motives and intentions, differences over interpretation of international water law, and an inability to agree on common management patterns that could simultaneously apply to both the Syr Darya and Amu Darya River Basins (i.e., for the entire Aral Sea Basin).

In response, a “framework” agreement (Syr Darya Framework Agreement) was brokered in 1998 through the Interstate Commission for Kazakhstan, Kyrgyzstan, Tajikistan and Uzbekistan covering management of the irrigation storage and hydropower generation facilities of the upper Syr Darya Basin (Naryn Syr Darya Cascade).2 The 1998 Syr Darya Framework Agreement provides for annual bilateral negotiations between the upstream and downstream states on fuel supply and hydro-electricity purchase in exchange for irrigation storage. Though mixed in the workability of its provisions and thus its implementation success, the 1998 Agreement has given a strong measure of stability to relations over management of the basin’s water resources—focused on balancing trade-offs between irrigation and hydropower.

Elsewhere, Kazakhstan and Kyrgyzstan negotiated in 2000 a preliminary accord on management of their shared Chui and Talas River Basins, and Kazakhstan and the People’s Republic of China signed first-stage agreements in 2001 on their shared Ili-Balkash and Irtysh River Basins. Kazakhstan also has agreements in place with Russia covering the rivers flowing into its territory from the north and for the Irtysh regarding its flows from Kazakhstan into Russia. 3 In 2003 IFAS produced a second Aral Sea Basin Program document (ASBP-2) meant to facilitate further national and international funding for water, environmental and social investments in the basin.

The low record of success for outside agencies attempting to assist post-independence Central Asia with regional cooperation on transboundary water management provides instructive lessons. Just as the EU-sponsored efforts through SIC-ICWC during the first Aral Sea Basin Program did not get past the stage of drafting interstate water management agreements, the Interstate Fund for Saving the Aral Sea (IFAS) has not been able to produce more than the broadest of cooperation agreements with scant enforcement. OSCE and the British Government offered aggressive mediation in the late 1990s which was rebuffed by most riparian nations. The only significant interstate agreement signed on transboundary water and energy management is the 1998 Syr Darya Framework Agreement, and this came about as the result of local initiative backed by years of patient and deferential USAID-sponsored technical assistance. An attempt in 2003 by the World Bank and the Asian Development Bank to see regional water and energy issues addressed through Central Asian Regional Economic Cooperation (CAREC) forum failed to gain acceptance by Uzbekistan and the People’s Republic of China, though it is now on the 2004 agenda (thanks in large part to the parallel CACO initiative promoting dialogue on creation of a regional Water and Energy Consortium). Patience, deference, careful attention to national sensitivities, an emphasis on providing an atmosphere in which both analysis and negotiations are both locally driven yet conducted with neutrality emerge as the key lessons for future efforts to support improved regional cooperation in this field.

2 This interstate commission was a forerunner to the current Central Asian Cooperation Organization (CACO). Tajikistan actually acceded to the Agreement only in 1999 after joining the Interstate Commission. 3 Roughly one-half of Kazakhstan’s surface waters flow into its territory from neighboring states.

5 2.2 Key Water Management Issues in the Region

At least six key constraints to improved transboundary water management can be identified. In addition to these issues, the points raised above about special attention to Central Asian sensitivities cut across all of these topics. There also are fundamental constraints imposed by the recent independence of the Central Asian states and their resulting desires to assert national sovereignty. There also is a strong correlation between individual country’s progress in promoting free markets and open societies and their willingness to pursue solutions to regional problems through cooperation with neighboring states. The situation demands on-the-ground expertise, coupled with realism and patience regarding results in this area. Nevertheless, the six constraints identified below must be addressed if progress is to be made; their order of presentation below does not indicate their relative importance:

i. The need for interstate agreement on how to address irrigation-hydropower trade-offs is particularly acute and continues to attract high level political and diplomatic attention, especially for management of the Syr Darya Basin;

ii. Efforts to address transboundary water management issues have been hampered by weak understanding and application of international water law;

iii. Transboundary water management is constrained by limited, inaccurate and only weakly transparent information collection and analysis;

iv. The recent focus on the water-energy nexus has meant that crucial environmental and social concerns in transboundary water management are not being addressed, including the continuing humanitarian and ecological crisis in the immediate area of the former Aral Sea;

v. Regional water management organizations require considerable strengthening if they are to fulfill their stated mandates relating to transboundary basin management; and

vi. National and local policies and practices do not yet fully encourage efficient and integrated water management.

It should be clear that these issues relate primarily to limitations of governance systems— economic, social, political and administrative—rather than technical concerns. Though the needs and costs of water infrastructure improvements should not be understated, the most rapid progress with transboundary water management in the region can be achieved through the introduction of improved management and governance systems at the regional, national and local levels. The next section of this paper provides more detailed information on each of the six areas identified above, followed by suggested programming intervensions for addressing each problem area.

6 Map of Central Asia (boundaries are not authoritative)

Conflict over Irrigation Storage versus Hydropower Production. Otherwise referred to as the “water and energy nexus”, there are important unresolved issues relating to the operation of upstream multiple-use dams—especially Toktogul in Kyrgyzstan situated in the upper Syr Darya Basin. Soviet-period patterns of water and energy exchange already have been briefly explained. The initial five-year period of the 1998 Syr Darya Framework Agreement was extended in 2003 for an additional five years by its signatories, and there has been a recent flurry of attention by both the Central Asian states and donor agencies on the possible reworking this agreement for improved and mutual benefit of the riparian states. The Central Asian Cooperation Organization (CACO)—a successor to the interstate commission that negotiated the 1998 Agreement—has evaluated experience with the Agreement’s implementation and also has established interstate expert groups to explore creation of a Water and Energy Consortium (WEC) that might take over some aspects of basin management. Studies also have been commissioned on related topics by the World Bank, Asian Development Bank and the US Agency for International Development to explore other means for balancing irrigation and hydropower uses based on the foundation of the 1998 Syr Darya Framework Agreement. The joint UNECE-ESCAP Special Program on the Economies of Central Asia (SPECA), which ended in 2003, also examined various aspects of the water-energy nexus in the region. The parallel situation on the Amu Darya has attracted considerably less attention, primarily because far less irrigation storage capacity exists in the upper basin. The situation also has led some in Uzbekistan to suggest that the country protect its “water security” through construction of increased irrigation storage capacity on its own territory—a policy which the government has already begun to implement.4

4 Kazakhstan also is considering the construction of additional irrigation storage capacity to counter Uzbekistan’s moves and capture more of the wintertime releases from Toktogul Reservoir when Kyrgyzstan operates it in hydropower mode. At present, winter releases are largely unavailable for irrigation use and most do not find their way

7 Weak Application of International Watercourse Law. Understanding of international public law and precepts relating to the management of transboundary rivers remains weak in the region. Both upstream and downstream states harbor misperceptions and anxieties about the net effects of applying international water law in interstate negotiations for long-term binding solutions to current regional water and energy management problems. The Central Asian countries are unfamiliar with contemporary developments in this type of law, and have scant experience with international law in general, since during the Soviet period all questions of foreign policy and public international law were the responsibility of the Soviet foreign ministry in Moscow. Though it has yet to enter into force, the 1997 Convention on the Non-Navigable Use of International Watercourses (1997 Convention) is accepted as the best declaration of customary international law regarding transboundary watercourses and was implicitly recognized as such in a recent decision of the International Court of Justice.5 Among its provisions, the 1997 Convention says that “watercourse states shall in their respective territories utilize an international watercourse in an equitable and reasonable manner…[and] take all appropriate measures to prevent the causing of significant harm to other watercourse states” [emphasis added]. Any attempt to apply the 1997 Convention to Central Asian’s situation will require a clear understanding of such rules and principles of customary international watercourse law, and even the donor community has at times been confused over international legal concepts or pertinent mechanisms of international law as they affect the options facing Central Asian countries. Uncertainties also have arisen because of differences between Soviet and Western legal systems, particularly the Soviet focus on treaty law at the expense of customary international law, general legal principles and reference to published writings.

Weak Information Collection and Management. The water management problems which arose during the Soviet period were not a result of planners having weak information for decision making. In fact, there were generally well maintained systems for monitoring and forecasting water flows and even pollution levels. Unfortunately, very little of this exists today. It is further hampered now by the international nature of data collection and management for transboundary rivers and the cost of maintaining and replacing sensitive hydro meteorological, gauging and other measurement devices. Some investments have been made—mostly with international assistance—to replace the backbone of such information systems, but they have not yet produced a viable and transparent information collection system for the rivers of the region. Some modeling also has been conducted, but it is poorly recognized and applied. Though a few protocols on environmental and natural resources (including water) data sharing have been concluded, these are weakly implemented amongst the riparian states in all basins (with the possible exception of interactions between Kazakhstan and Russia on their shared rivers). Some recent efforts organized through the two SICs of IFAS—for ICWC and ICSD—seem to offer some limited promise, but they are geared more to database establishment than to organizing information for decision making.

Addressing Environmental and Social Concerns in Transboundary Water Management. The recent attention given to transboundary river basin management in the Aral Sea Basin primarily has focused on addressing irrigation-hydropower trade-offs at the expense of concern for the social and environmental consequences of alternative transboundary river

to the Aral Sea because of the river’s freezing. Instead, they cause flooding problems and damages in Uzbekistan and Kazakhstan. 5 Other important references that are weakly appreciated in the region include the 1992 UNECE Convention on the Protection and Use of Transboundary Watercourses and International Lakes, the 1991 Dublin Statement on Water and Sustainable Development and the 1966 International Law Association’s Helsinki Rules on the Uses of the Waters of International Rivers.

8 management schemes. The ASBP-1 was built primarily around addressing these humanitarian issues, and today the population residing in the territory of Uzbekistan, Turkmenistan and Kazakhstan located in the region surrounding the former Aral Sea remains amongst the poorest and least healthy in Central Asia. This is primarily due to low access to clean and non-saline water supply. The restricted quantity and questionable quality of surface water in this area also results in depleted wetlands, highly stressed riverine ecosystems, and greatly accelerated processes of desertification and land degradation. In theory, existing Aral Sea basin agreements provide for minimum river flows to the lower basin to maintain the sea and riverine environment and provide surface waters for the population, but these have not been honored. Ensuring that this happens is one of principal tasks of the ICSD under IFAS, but it has not been able to fulfill this function. Access to clean water and sanitation services also is constrained elsewhere in region by transboundary river management practices and problems include flooding, salinization and confusion over the use of irrigation drainage canals for sewage disposal. Various forms of land degradation—with regional and even global significance—also stem from water mismanagement at the local, national and transboundary levels. Finally, concern over transboundary water pollution is rising in the region, especially from agricultural wastes and mine tailings.

Regional Water Management Organization Capacities and Mandates. IFAS and its subsidiary bodies are the principal international organizations created with explicitly recognized roles and responsibilities for transboundary water management—in this case specifically for the two rivers of the Aral Sea Basin. Headed by the five riparian presidents and managed by a Board with representatives at the deputy prime minister level, IFAS appears on paper to be a reasonably coherent and viable preliminary mechanism for organizing and coordinating water management and economic development programs in the Basin.6 While the five heads of state still seem to value this mechanism as a potentially useful tool for generating and overseeing international financial support for the Basin, there unfortunately remain fundamental weaknesses in all branches of IFAS. EC-IFAS has insufficient staff and resources to fill its secretariat role, as demonstrated by frustrations over the ASBP-2’s limited ability to attract international support. Both the IFAS and EC-IFAS chairs have rotated on a two-year term among the members, and this has not served to provide consistent leadership or a shared sense of direction.7 ICWC has continued to function as a committee of the region’s water ministers, while SIC-ICWC has found assistance from a variety of sources to support ICWC decision-making and some training of water professionals. But ICWC is narrowly irrigation oriented and thus constrained in its ability to deal with water-energy linkages and other integrated concerns. ICSD has met only sporadically and seems uncertain about its mandate and future programmatic directions. The Regional Environmental Action Plan (REAP)— for now still attached to ICSD—has not yet served its intended role as a catalyst for action on water and other transboundary problems. The Central Asia Regional Environment Center (CA-REC) is a potentially innovative means for bridging between the public sector and civil society, but it too is still getting its feet on the ground.8 As noted, CACO is now getting back into the area of transboundary water and energy management through its efforts to broker discussions on the concept of a Water and Energy Consortium. There also are joint commissions for several of the rivers shared by Kazakhstan and Russia, and the Chui-Talas Commission is being formed to govern the relations between Kazakhstan and Kyrgyzstan for those rivers.

6 Though it is an important riparian state in the Amu Darya Basin, Afghanistan has yet to be included in the IFAS structure—further complicating management relations. 7 The IFAS chair should rotate from Tajikistan to Kyrgyzstan in early 2005, while there appears to be agreement among the members to allow EC-IFAS to permanently establish itself in Dushanbe (with arrangements to be finalized during the next heads of state meeting in early 2005). 8 Both EC-IFAS and ICSD have worked with CA-REC to conduct analyses of regional water and other issues and to prepare for international environmental meetings, but this seems to have detracted somewhat from CA-REC’s efforts to facilitate public participation in environmental decision making.

9 Inefficiency of Water Management. Problems that result from the mismanagement of transboundary rivers manifest themselves at the level of the farm, household, factory and municipality, and they are often caused as much by inefficiencies at the ground level as by the lack of interstate agreement on water allocations or quality. Central Asia’s national and local water management systems are still rife with such inefficiencies—from the over-use of irrigation water for crop production and the “leaching” of salt from fields to poor irrigation drainage management and weak abilities to manage surface water and groundwater resources in a conjunctive manner. Efforts to establish viable interstate mechanisms for transboundary water management will be wasted unless parallel progress is made in such areas as agricultural water conservation. Despite promising and reasonably widespread recent innovations with the introduction of water user associations to improve on-farm water management, water use practices in agriculture remain grossly inefficient relative to other parts of the world with similar conditions and crops. Moreover, concepts of integrated water resources management—considering the interests of all stakeholders, users and possible uses of water for a given hydrological unit—have not yet found application, as they have only recently been introduced to the region and run counter to the highly segmented sectors of agriculture, energy, industry, navigation, environment, and municipal management. The cost of needed irrigation, water supply and sanitation investments in Central Asia are truly daunting, especially considering that all but a small portion of the existing infrastructure dates from the Soviet period and is deteriorating rapidly.

2.3 Overview of Main Donor Programs in the Water Sector

A number of initiatives are currently underway to address water management issues, and most are supported by at least some measure of international assistance. This section summarizes current donor responses in the water sector the region. It briefly reviews the major efforts being implemented at present, organized according to the principal donor rather than the recipient or implementing body.

UNDP. With a history of assistance to Central Asian transboundary basin management dating from the early 1990s, mostly through GEF co-financed international waters projects and institutional support to IFAS and the ASBP, UNDP is now preparing this new regional strategy and action program to redefine its role while taking advantage of lesions from past experience. UNDP recently played a leading role in helping Tajikistan and IFAS organize the 2003 Global Freshwater Forum convened in Dushanbe, which prominently featured Central Asian water management issues. UNDP also has initiated (with support from Norway and the Global Water Partnership) a project to help the Water Resources Committee of Kazakhstan develop a National Integrated Water Resources Management Plan.9 From 1998-2002 UNDP implemented the $18 million GEF Caspian Enviornmental Program, and in 2004 embarked on implementation of the second phase of this Caspian project (a $32 million GEF co-funded project). The 2003 national Human Development Reports (HDR) for both Tajikistan and Kazakhstan focused on water management concerns, and the 2005 regional HDR also will include a significant section on regional cooperation for improved water resources management. The UNDP 2004-2007 water strategy program described herein will firmly place UNDP as a significant contributor to addressing the regional water management problems identified.

World Bank. Thus far, the World Bank has been arguably the most active donor in the area of Central Asian water management, having served as lead for ASBP-1 (Executing Agency for

9 This project potentially represents a model for replication throughout the region to help the Central Asian countries meet the global target of establishing such national plans by 2005 as agreed during the 12th Session of the UN Commission on Sustainable Development.

10 most of the GEF resources allocated). In addition to the analyses and pilot activities under ASBP, World Bank land and water management programming has included country-level investments in the irrigation sector as well as a project to divide the remainder of the Aral Sea into two parts. 10 It also has produced a recent insightful review of agricultural water use and associated needed reforms in the region.11 The World Bank can be expected to continue country-level investments for improved irrigation, drainage and wetlands management, with associated water and agricultural policy reforms. It is significantly addressing the “energy-water nexus” on the Naryn-Syr Darya Cascade, having produced a recent analysis of options for the riparian states. The activity now centers on providing support to CACO’s efforts to develop an implement a WEC concept, through regional dialogue of experts in the water, energy and economic fields. The Bank also plans to contribute to better water management in the Ferghana Valley through a series of country-level investments in all three riparian states (Kyrgyzstan, Tajikistan, and Uzbekistan). Finally, it is in dialogue with IFAS about further capacity building measures to that organization, based on a highly critical evaluation of its IFAS’ performance under ASBP-1 and centering on strengthening its roles in donor coordination and water information management.

Asian Development Bank (ADB). The ADB is playing an increasingly active role in encouraging greater regional economic integration in Central Asia through its sponsorship of the Central Asian Regional Economic Cooperation (CAREC) forum. It has recently committed to further regional support for environmental information networking, building on considerable previous environmentally-related assistance to the region.12 ADB sponsored Central Asian participation in the 3rd World Water Forum of 2003. It has recently initiated a follow-up regional project on management of shared watercourses including components on: improvements to the 1998 Syr Darya Framework Agreement (through SIC-ICWC); management of the Chui-Talas Basin; and facilitation of regional dialogue on key issues relating to shared water resources management in the region. ADB also has country-level investments with Water Resources Ministries/Committees in all Central Asian countries except Turkmenistan to improve irrigation management and expand rural water supply.

European Union (EU). The EU has been active through its Technical Assistance for the Commonwealth of Independent States program (EU/TACIS) since the early 1990s through the so- called WARMAP and WARMIS projects through the SIC-ICWC and targeting the Basin Management Organizations (BVOs) of the Aral Sea Basin. It has assisted in water policy and institutional development, focusing on capacity building, legal assistance and strategies for managing water. The current phase of EU/TACIS assistance is focused on two pilot transboundary basins: Chui-Talas (Kyrgyzstan-Kazakhstan); and the Vakhsh (Tajikistan-Turkmenistan), where it is developing new models for shared water management in Central Asian conditions for application/replication in other basins. The EU also is preparing to implement the EU Water Initiative (EUWI) through TACIS which will assist the countries of the region “in developing plans for integrated water resources and water efficiency…[and support] exchange of experiences regarding integrated water management...” The EUWI also will develop a water investment support instrument for the conduct of feasibility studies and identification and preparation of water investment projects as well as supporting small scale investments and pilot projects centered on the two areas of: (i) promoting integrated water resources management; and (ii) expanding access to clean water supply and sanitation services.

10 With construction of this levee just south of the Syr Darya River’s delta to preserve aquatic ecosystems and partially restore fisheries, the Aral Sea will essentially cease to exist and be relegated to two separate lakes. 11 Bucknall, et al. 2003. Irrigation in Central Asia: Social, Economic and Environmental Considerations, World Bank: Washington. 12 See: McCauley, 2002. Summary Analysis of ADB Environmental Assistance to the Central Asian Republics, ADB: Manila.

11 Swiss Government. The Swiss Development Corporation (SDC) is very active on water management in the region, with current projects centering on: improved irrigation canal and on- farm water management in the Ferghana Valley (with the International Water Management Institute and SIC-ICWC); hydro-meteorological data collection, water monitoring and information sharing; and improved drinking water supply (with UNDP) for cross-border projects between Kyrgyzstan and Tajikistan. The Central Asia Regional Water Information Base (CAREWIB) Project, implemented in partnership with SIC-ICWC, UNEP/GRID-Arendal and UNECE holds considerable promise as a transparent portal for water information in the region. SDC also has proposed to create a Regional Centre for Hydrology under the auspices of EC-IFAS.

United States of America Government. The US Agency for International Development (USAID) has been supporting the ASBP since 1994. It has assisted with improved drinking water, transboundary water issues, and meteorological monitoring, fisheries management in the Syr Darya delta and a strengthened legal/regulatory framework. Most of USAID’s water assistance in the region is now focused on field-level demonstrations of improved irrigation systems and hydrological monitoring systems. Its transboundary work has included technical assistance associated with creation of the 1998 Syr Darya Framework Agreement and more recent analyses of management options for Toktogul Reservoir in Kyrgyzstan, basin modeling, and a pre-feasibility analysis for construction of the Kambarata I and II Dams above Toktogul. Through the regional environment program of the US State Department, support also is provided for a project on integrated water management for the lowlands and deltas of the Aral Sea Basin through SIC- ICWC. The State Department also has provided funding to UNDP for the Transboundary River Basin Initiative which is to be used to finance a significant portion of the new effort described in Part B of this report.

Organization for Security and Cooperation in Europe (OSCE). The OSCE is leading an activity supporting creation of the Joint Commission for the Chui and Talas Rivers in cooperation with EU/TACIS, UNECE and ADB. It also is involved with UNDP and UNEP in the Environment and Security Initiative, which deals in part with regional water issues, including a new effort in the Ferghana Valley to better understand the problems and management options associated with industrial water pollution.

Global Water Partnership. The Global Water Partnership’s Caucasus and Central Asia program (GWP-CACENA) is building regional relations to support improved integrated water management. It also is serving a resource mobilization function, for example having helped to bring UNDP and the Government of Norway together to finance the new Kazakhstan IWRM project.

Canadian International Development Agency (CIDA). CIDA has been active in regional water training, having helped to establish a water training center at SIC-ICWC in Tashkent. Its current program, however, are almost exclusively focused on alleviating poverty at the local level in Tajikistan.

UN other than UNDP. United Nations Environment Program (UNEP) has done considerable work on Aral Sea Basin since 1989, mostly in preparing reports on environmental trends and conditions. More recently, it partnered with the ICSD (with co-financing from UNDP and ADB) to support the REAP, which includes transboundary water issues as one of its five program areas. The UN Economic Commission for Europe (UNECE) and the UN Economic and Social Commission for Asia and the Pacific (ESCAP) partnered to create SPECA, which was concluded in 2003 and included an analysis of regional water and energy management issues.

12 These organizations have recently made a commitment to EC-IFAS to continue SPECA’s work on these topics, subject to the availability of funds. ESCAP also supports an analytical project on strategic management of transboundary river basins in Central Asia. The UN Educational, Scientific and Cultural Organization (UNESCO) has administered the Aral Sea Basin Initiative (ASBI) since 1992, which comprises a network of research projects in the region. The Scientific Advisory Board for Aral Sea Basin Problems (SABAS) was created by UNESCO in 1998 to generate options for possible future actions/remedies, and a new phase of the ASBI was launched in October 2002. UNESCO also recently sponsored a conference on Dialogue among Cultures and Civilizations in Eurasia—hosted by the President of Kyrgyzstan and including participation of several Central Asian countries—that dealt, in part, with transboundary water issues as a potential source of conflict.

3. Regional Water Management Vision and UNDP Strategy

This section presents a strategy of targeted activities for UNDP’s regional water assistance to the Central Asian countries as part of its broader Strategy for Central Asia. The period chosen for the regional water strategy is from late-2004 to mid-2007, in order to provide sufficient time for progress in this complex area.

UNDP brings a unique combination of characteristics as a development assistance agency to its transboundary river management efforts in Central Asia. It has a substantial country presence in all five Central Asian states and a proven and trusted ability to serve as an objective analyst and fair broker amongst all interested parties. UNDP also has a proven track record and ability to manage and implement capacity building programs—including having led such efforts during the ASBP-1 implementation period, and in other transboundary river basin around the world. It is in a position to serve as lead UN body for this subject area and to effectively link with other UN entities to achieve good coordination and synergy.

This report has provided an extensive analysis of the current situation regarding Central Asian water management, so this will not be repeated here. In summary, six key issues have been identified as constraints to improved regional water management: i. the need for interstate agreement on how to address irrigation-hydropower trade-offs; ii. weak understanding and application of international water law; iii. limited, inaccurate and only weakly transparent information collection and analysis; iv. crucial environmental and social concerns in transboundary water management are not being addressed; v. Regional water management organizations require considerable strengthening; and vi. National and local policies and practices do not yet fully encourage efficient and integrated water management.

UNDP has developed targeted intervensions (project components) to address each of the six key issues listed above. These intervensions are described in detail in Section 4. The total budget for implementation of all project components for the 2004-2007 period is $7.61 million. UNDP has allocated $1.75 million for project implementation and is seeking $5.86 million in co-financing.

4. UNDP Central Asia Water Strategy Project Components

While there are a number of donor initiatives financing intervensions in the water sector in Central Asia, several niche areas remain, which UNDP is uniquely suited to fill. The following section

13 describes seven project components targeted to address critical problem areas in water management in Central Asia. A Project Management Unit (PMU) will support implementation of UNDP’s Central Asia Water Strategy 2004-2007.

4.1 Project Management Unit

A Project Management Unit (PMU) will be based either in Dushanbe, Tajikistan or Almaty, Kazakhstan and will work in close co-operation of the other UNDP Country Offices in Central Asia. The Project will be led by an international technical advisor (CTA), who will be responsible for both its overall day-to-day management and for providing technical inputs under several of its components. Three program assistants, to be based in Tashkent, Dushanbe and Almaty, will support the work of the CTA. Quarterly Progress Reports and Annual Project Reports (APR) will be prepared by the CTA reflecting all aspects of project implementation. The APRs will be concise documents that assess the project’s performance and the status of achievement of anticipated outputs as well as contributions to the relevant UNDP Strategic Results Framework (SRF) Outcome(s) on a calendar year basis. The project will be subject to external audit every year to be conducted by the legally recognized auditor selected by UNDP.

The CTA and UNDP Tajikistan/Kazakhstan will work closely with UNDP’s Regional Bureau for Europe and CIS (RBEC) in New York, the Regional Support Centre in Bratislava (RSC) and the UNDP Resident Representatives in Central Asia. Program management and activities will be guided by a Steering Committee comprising the five UNDP Resident Representatives and representatives from RBEC/New York and RSC/Bratislava, and the UNDP Bureau for Crisis Prevention and Recovery (BCPR). The Steering Committee will be responsible for the overall co-ordination and management of the Project within the broader program to implement the UNDP Strategy for Central Asia, including policy guidance and review, approval of annual work plans, and assistance with the organization and approval of co-financing arrangements. In addition to regular electronic communications, the Steering Committee will meet three times a year to review progress of the Central Asia program, including TRIMCA, and to provide strategic direction. Total cost for the PMU (CTA and three program assistants) is US$350,00 for the 2005-2007 period.

14 4.2 Project Components The seven project components described below identify niche areas where UNDP can make a significant contribution to improved water resources management in Central Asia. Each of these components addresses one (or more) of the six key constraints to improved water management in Central Asia, described in Section 2.2. UNDP’s country office network throughout Central Asia, experience in management of large-scale water projects in the Central Asia region, reputation for neutrality and global and regional track record in capacity building make UNDP uniquely suited to achieve significant in-roads in the water sector working at the local, national and regional level.

Development of a Central Asia Water and Energy Consortium (WEC)

Background. Section 2.2 of this document presented some of the recent history of CACO’s re-invigoration of dialogue on the possible creation of a WEC—especially dealing with water and energy management in the Syr Darya Basin. This is the only significant locally driven effort to deal with transboundary river management issues, and it represents the best current opportunity to obtain full participation from all riparian states in developing or revising agreements governing the transboundary rivers of the Aral Sea Basin. Despite efforts by Uzbekistan to develop additional irrigation storage capacity on its own territory in order to reduce its dependence on upstream neighbours, there continue to be significant untapped net regional benefits from cooperation on water and energy management for the Syr Darya and other basins. Kazakhstan serves as the chair of this effort, and the World Bank has been designated by CACO as the lead donor for this subject.

Objectives. This activity will support the CACO-led effort to take the WEC from conceptual stage into something more operational that can improve the relations of Aral Sea Basin riparian nations with respect to balancing irrigation and hydropower uses of transboundary river waters.

Activities. Two types of interventions will be carried out, both on a regional basis, to achieve the anticipated results:

(i) Modest support, in partnership with the World Bank and possibly others, for the convening of Expert Group meetings in collaboration with CACO to develop concrete proposals for making the WEC concept operational; and

(ii) Technical assistance to review draft WEC-related documents and advise the parties on options with regard to WEC’s formation, including its structure within the context of international watercourse law.

Implementation. A Chief Technical Advisor (CTA) will be retained to manage the project as a whole and to assist with the implementation of each component, and the CTA will play a particularly strong role in assisting the CACO-led dialogue and in interacting with UNDP’s development agency partner, The World Bank. The Kazakhstan Ministry of Foreign Affairs in

15 Astana has the lead among CACO member countries for this activity, and they will serve as principal counterpart for the organization of UNDP’s organizational and technical inputs to this dialogue. CACO is sponsoring regular meetings with the four international financial institutions (IFIs), and it would be useful for UNDP to be included in this partnership arrangement. There also is an effort to fold the CACO-led dialogue under the umbrella of the Central Asia Regional Economic Cooperation (CAREC) forum, the secretariat for which is maintained by the Asian Development Bank. UNDP already is an active partner it this effort and it also can coordinate its inputs through this mechanism.

Resource Requirements. The total budget for this project is $90,000 for the 2005-2007 period.

UNDP funding Requested additional support Total project budget $0 $90,000 $90,000

Capacity Building in Transboundary River Law

Background. The Central Asian countries remain largely unfamiliar with international public law and precepts relating to the management of transboundary rivers. This is explained, in part, by their having had little role in matters of international law during the Soviet period when all was handled by Moscow. Moreover, Soviet era legal training focused on treaty law, with scant attention given to customary international law and other general legal principles. Though there have been some international assistance efforts meant to improve understanding of these principles, misunderstandings and misperceptions continue. The donor community has itself also missed some opportunities to encourage the application of international legal concepts or pertinent mechanisms of international law to the identification of lasting solutions to the transboundary river management problems facing Central Asian countries.

Any efforts to establish a climate in which shared watercourses can be peacefully utilized for the benefit of all riparian states in the region must strive to conclude interstate agreements on transboundary water management that are perceived to be fair and also can be implemented and enforced. If such agreements are to hold up over time, they must be based on a clear and thorough understanding of international watercourse law—taking full advantage of globally recognized principles.

Though it has both strengths and weaknesses, the 1997 Convention on the Non-Navigable Use of International Watercourses serves as the fundamental touchstone for customary international law regarding management of transboundary watercourses. Other relevant references include the 1992 Convention on the Protection and Use of Transboundary Watercourses and International Lakes, the 1966 Helsinki Rules on the Uses of the Waters of International Rivers. The 1997 Convention includes such provisions as the principles of using international watercourses in an equitable and reasonable manner and taking all appropriate measures to prevent the causing of significant harm to other watercourse states. Applying principles such as these to Central Asian’s situation will require a clear understanding of customary international watercourse law’s rules and rationale.

16 There already exist several collections of the relevant and applicable pre- and post- independence water agreements pertaining to management of the region’s transboundary waters, and such reference materials will be needed to support any capacity building efforts on these subjects. Some analysis also has been conducted of the rights and responsibilities/obligations of riparian states in the region, especially for the Aral Sea Basin. This limited baseline can be used as a starting point for training efforts and supplemented by information obtained in the course of implementing the activity.

Objectives. To help Central Asian states improve their chances of binding agreements on the management of their transboundary watercourses, this activity will build capacity and expertise in international watercourse law in all five countries of the region. As part of this capacity building exercise, the activity also will provide limited legal technical assistance to support development of specific interstate agreements on transboundary water management in Central Asia.

Activities. A mix of approaches will be needed to achieve the stated objectives and four types activities are planned to build Central Asian capacity in this area:

(i) Training-of-trainers short-course for Central Asian legal specialists to create a core group that can assist with further training, outreach and analysis on international watercourse law;

(ii) Regional in-depth training program targeting water, energy and environmental experts, foreign ministry staff, parliamentarians and policy/legal specialists, with participants to apply their acquired knowledge to specific problems of transboundary river management in the region through follow-up expert group meetings;

(iii) Baseline analysis of legal agreements reached in Central Asia pertaining to transboundary river basin management;

(iv) Study tour to review international experience with applying principles of transboundary river law (with possible co-financing by World Bank or ADB);

(v) International conference on transboundary river basin management to be hosted by Tajikistan (and supported by UNDP Tajikistan) that will feature international water law subjects and exchange of global experience; and

(vi) Technical assistance relating to transboundary watercourse law to support operationalization of the WEC concept.

Implementation. UNDP will manage the program, working in close partnership with regional organizations, government agencies, academic organizations, parliaments, other assistance agencies and NGOs to identify appropriate program participants. Examples of partner organizations include: SIC-ICWC; EC-IFAS; water, energy and environment ministries/ committees, ministries of foreign affairs, and parliamentary committees responsible for water and environmental management in the riparian states. Participants will be drawn from all five Central Asian countries in roughly equal numbers to ensure a balanced development of knowledge on these subjects. A senior recurrent international legal advisor will be contracted to assist with the organization and implementation of this project component, and it will fall under the overall supervision of the CTA.

17 Resource Requirements. The total budget for this project is $570,000 for the 2005-2007 period. UNDP has allocated $200,000 for this project component, and is seeking $370,00 in co- financing.

UNDP funding Requested additional support Total project budget $200,000 $370,000 $570,000

Building Social and Environmental Considerations Back into Regional Dialogue on Transboundary Water Management

Background. Recent attention relating to transboundary river basin management in the Aral Sea Basin has focused on addressing the trade-offs between upstream and downstream states over irrigation storage versus hydropower generation. While this is a vital concern for the peoples of these countries, the positive social and environmental consequences of maintaining adequate river flows are no less important (though they arguably of lower political significance due their affecting poor downstream communities and environmental health rather than urban populations). Fortunately, any additional water made available on social grounds to support affected communities in the lower basin will also generate strong environmental benefits for the region.

But these considerations have largely been lost from the regional dialogue on transboundary water management. Such social and environmental concerns lay at the core of the first Aral Sea Basin Program, which centered on addressing humanitarian and environmental problems in the “ecological disaster zone” immediately adjacent to the shrinking Aral Sea. Agreements were reached providing for minimum river flows of a given quality to the lower basin to stabilize the sea and riverine environment and to provide surface waters for the population of that region. These agreements have not been honored, and the social and environmental costs and benefits associated with transboundary river management options currently under discussion in the basin are only weakly being considered. The Interstate Commission for Sustainable Development under the International Fund for Saving the Aral Sea has been charged with addressing these issues, but it has not been able to do so effectively.

The population residing in the territory of Uzbekistan, Turkmenistan and Kazakhstan in the region surrounding the former Aral Sea is amongst the poorest and least healthy in Central Asia. This includes Khorezem Oblast and the Republic of Karakalpakstan in Uzbekistan, Dashouguz Oblast in Turkmenistan and Kzyl-Orda and South Aral Oblasts in Kazakhstan. Any efforts to bring greater stability to their water supply will greatly improve their quality of life (as measured, for example, by the Millennium Development Goals). Environmental damages associated with deprivation of water to this region also have been and continue to be enormous, as manifested in depleted wetlands highly stressed riverine ecosystems, and greatly accelerated processes of desertification and land degradation.

Objectives. This activity will encourage the riparian nations of the Aral Sea Basin to honor prior agreements and evaluate further options concerning the incorporation of social and environmental dimensions of transboundary water management into basin management efforts and to cooperate in establishing workable arrangements for their implementation to achieve social and environmental benefits.

18 Activities. Two types of analyses and assessments are to be conducted as the basis for better informed regional dialogue on the importance of including and honoring these considerations in transboundary water management regimes and agreements:

(i) Social and environmental costs associated with current surface water flows will be calculated compared to the benefits (in human, bio-physical and economic terms) of the riparian states meeting previously agreed levels; and

(ii) Further social and environmental assessments will be conducted—using internationally accepted methods—to evaluate the implications of transboundary river management proposals currently under consideration, especially for the Syr Darya River, and to inform the associated regional dialogue.

Implementation. UNDP will oversee implementation of this activity in partnership with institutes based in the region as well as the international donor community. The analysis and associated dialogue will be linked with ongoing regional discussions organized by CACO and other regional bodies, and implemented in cooperation with the environment and water ministries/committees of the riparian countries. Partnership arrangements with institutes for strategic and international studies as well as for environmental analysis will be explored as will working relations with IFAS and its subsidiary bodies. A three-year timeframe is envisioned, with analyses and discussions to become progressively sophisticated over time.

Resource Requirements. The total budget for this project is $600,000 for the 2005-2007 period.

UNDP funding Requested additional support Total project budget $0 $600,000 $600,000

Ferghana Valley Water Quality Improvement and Capacity Building

Background. Lying in the heart of Central Asia, the Ferghana Valley—shared by Kyrgyzstan, Tajikistan and Uzbekistan—represents the most fertile and densely populated area in this region. Fed by the waters of the great Syr Darya River, the area’s economic intensity is based on an irrigated agricultural system with roots that go back to the days of the Silk Road and primarily producing cotton, wheat, rice and vegetable crops. There also exists considerable industrial capacity—much of it for agricultural processing—alongside farming communities.

Due to the combined effects of the rapid and often weakly planned irrigation intensification programs of the latter Soviet period and the post-independence challenges of operating and maintaining complex water management systems, the Valley today is facing tremendous resource management problems with strong social and environmental consequences. Derived from agriculture, industry and other economic activity, water pollutants in the Valley take the form of mineralization, pesticides, phenols and oil products, fertilizers and heavy metals. There is concern that income disparities, ethnic tensions and resource mismanagement could lead to conflict.

19 The pace and pattern of economic and social reform in the three riparian countries also have varied considerably—adding to the area’s policy and institutional complexity. The economic, social and political significance of the Ferghana Valley has drawn a number of international assistance efforts, notably including those funded by the World Bank, Asian Development Bank and Swiss Government, but these remain only loosely coordinated (World Bank has a general medium-term plan to develop water management projects in each country, and then to link them under a “regional” umbrella). UNDP chairs Ferghana donor coordination councils for Tajikistan and Kyrgyzstan, and this is under discussion for Uzbekistan; informal donor coordination meetings covering primarily Uzbekistan and the Ferghana Valley have recently been organized at the initiation of the Swiss Government. Most attention in the Ferghana Valley has been focused on improving water management for irrigated agriculture as well as on local community development and empowerment. The Government of Uzbekistan, in particular, has remained wary of creating regional bodies—even for project implementation—above the level of national authorities. For this reason, all major water-oriented projects are conducted at either the national or multi-country rather than regional level. UNDP is currently developing a PDF-A for a Medium Sized Project (MSP) for Global Environmental Facility (GEF) co-financing to address water quality and quantity issues in the Valley. The anticipated co-financing which will be sought from GEF is approximately $1 million.

Objectives. There is a clear need for improved integrated water and land resources management in the Ferghana Valley. Significant capacity constraints exist: information management on water quantity and quality is poor as are the analytical skills of those charged with land and water planning and management. Coordination difficulties arise at the national and international levels and both among government agencies and various national and regional projects. The overall objective of this project is to ensure that the quality and quantity of the water in the Ferghana Valley meets the short and long-term requirements for optimum ecosystem function as well as the needs of the communities using the river. The focus will be on transboundary issues.

The need for improved integrated land and water resources management in the Ferghana Valley is clear, based on: low water use efficiency in agriculture; rising concerns over surface water and groundwater quality; and associated threats to health and livelihoods. There also are significant capacity constraints inhibiting solutions; information management on water quantity and quality is weak as are the analytical skills of those charged with land and water planning and management. Coordination difficulties arise at the national and international levels and both among government agencies and the various national and regional projects.

Activities. Support will be provided for the design and implementation of an international project to address current shortcomings in the capacity of local, national and regional institutions managing the waters of the Ferghana Valley. The project will focus on: (i) fostering regional cooperation for river basin management; (ii) increasing national and regional capacities to address water quality and quantity problems; (iii) making key improvements to water quality/quantity at specific points on the river; (iv) developing sustainable financial and institutional arrangements for long-term management and protection of the rivers; and (v) promoting appropriate reforms to economic sectors causing pollution, water shortages and habitat degradation.

This effort will improve coordination among water sector projects in the Ferghana Valley for their enhanced performance in addressing key land and water management problems in an integrated fashion. It also will increase major stakeholders’ understanding of water quality and land degradation issues affecting environmental quality and social welfare within the Ferghana

20 Valley as well as downstream of this area, and it will assist with collaborative efforts to address them through policy and institutional reforms and strengthening.

Implementation. Key institutions to be involved include water user associations at the local level, water management institutions at the oblast and canal levels, BVO Syr Darya, water and environment ministries in all three riparian countries and NGOs. The UNDP Bratislava Regional Centre for Europe and the CIS will take the lead in project management, working closely with UNDP’s offices in the field. Close coordination will be maintained with other donor activities, including those of other UN organizations such as the forthcoming project on industrial pollution under the ENVSEC initiative, the joint Swiss/Grid-Arendal water information management project, and the water activity under the UNEP/UNDP-sponsored Regional Environmental Action Plan for Central Asia. Other arrangements will depend upon co-financing arrangements for the project.

Resource Requirements. The total budget for this project is $1,600,000. UNDP has allocated $100,000 from it’s own resources, and hopes to secure $1,000,000 from the GEF. UNDP is seeking $500,000 in co-financing.

UNDP funding (including co- Requested additional support Total project budget funding GEF) $1,100,000 $500,000 $1,600,000

Improving the Provision of Water Supply Services in Small Towns of Kazakhstan

Background. Water supply systems of small towns in Kazakhstan inherited from the Soviet period are in physical disrepair and lack sound management and economic footing. Most small towns in Kazakhstan (population between 500 and 5,000) have some form of piped water supply system utilizing surface and/or groundwater sources. The quality of water delivered is mixed, due to: variability in source quality, treatment; and exposure to secondary contamination from network leakages. There is some use of communal standpipes in rural areas, though most municipal water supply systems deliver water directly to customers. Metering has been introduced in some cases, but it is seldom based on the volume of consumer use—mostly being assessed at the level of apartment block (sometimes incorporating adjustments for persons served). Water supply enterprises generally are owned and operated by local municipal governments—giving only weak attention to technical and economic efficiencies, quality and reliability of service or cost recovery. Water collection, treatment and distribution infrastructure is deteriorating, and management authorities lack revenues for proper operation and maintenance. These water supply systems have been targeted by the Kazakhstan Government’s National Program for Development of Rural Areas for 2004-2010 (NPDRA), but there is not yet a model in place for addressing these problems.

Objectives. This project will establish models of improved water supply management and services delivery in small towns of Kazakhstan to improve access to clean water for target communities and to serve as demonstration sites for wider replication in the country.

Activities. Cooperating with the NPDRA, three pilot towns will be identified where new approaches to water supply service delivery will be developed. The selection criteria will include: (i) strong local government and water supply enterprise leadership with willingness to adopt new

21 approaches to management and service delivery; (ii) inclusion as a target community within the NPDRA; (iii) demonstrated need for water supply system improvements; and (iv) proximity to transport links so that the site may serve demonstration purposes. In each location chosen, the following general types of assistance will be rendered: (i) water supply enterprise management review and reform; (ii) water collection, treatment and distribution system assessment, with some highly cost-effective technical improvements made; and (iii) tariff structures reviewed and revised, but only in association with improved service delivery and consumer outreach with public participation.

Implementation. The Chief Technical Advisor (CTA) will provide guidance and support in project implementation. The project will be executed by the Ministry of Agriculture in collaboration with UNDP and EU/TACIS. Implementation will be carried out through a consultancy contract to acquire international and local expertise as well as the procurement of local goods and equipment, as needed. The project will be managed as a sub-component of the UNDP/Norway-sponsored Kazakhstan Integrated Water Resources Management Project. Preliminary dialogue has been held with the collaborating partners regarding this proposal, but more detailed discussions will be necessary to finalize project plans.

Resource Requirements: The total budget for the project is US$1.5 million for the 2005- 2007 period. UNDP has allocated $150,000 for this project and is currently seeking $1,350,000 in co-financing.

UNDP funding Requested additional support Total project budget $150,000 $1,350,000 $1,500,000

Improving Water Quality in Cross-boarder River Basins in Tajikistan

Background. Achieving the Millennium Development Goals (MDGs) on clean drinking water and sanitation is critical for Tajikistan as it is highly unlikely that the MDGs for infant and child mortality, school enrolment and attendance or disease control could be met without significant improvements in water and sanitation. There are many reasons for the poor state of Tajikistan’s water and sanitation services: lack of maintenance and/or destruction during the civil war, low levels of official budget allocation, difficulty collecting user fees and low level tension over access to water sources in border communities. Institutional strengthening and reform are needed to maintain and operate systems, test water quality, raise awareness on health and sanitation, and introduce fee-paying mechanisms to facilitate long-term sustainability. As the Government notes in its Poverty Reduction Strategy Paper, the rural population is priority for improved service.

There are three major options for improved access to safe water in rural areas with shared water resources: new central water systems based on borehole development and electric pumps, deep well hand pumps, and spring catchments. Central water systems (and, in certain areas, spring catchments) offer the best means of providing high quality water services to rural residents. In 2002, the Government approved the National Concept on Rational Use and Protection of Water Resources, which emphasises the need to reduce wastage and strengthen conservation of national water supplies. Authorities acknowledge the need to reform the financing of the water sector to bolster incentives for rational consumption and ensure that service provision is financially “self-

22 supporting” while taking steps to cushion the impact of tariff reforms on low-income households through targeted subsidy programmes.

Goals. The project will provide sustainable access to adequate and safe water and basic sanitation in rural areas with cross border river basins. The project will improve waste management and promote rational use of water resources.

Activities.

i. Rehabilitation of rural water supplies in border Jamoats with cross border river basins. The target areas will be selected based on a mapping of international support currently undertaken by the UN;

ii. Enhancing solid waste management in border Jamoats with cross border river basins;

iii. Improving water management at central and local level. At the local level, the project will support the establishment of water user associations and partnership between local authorities, system owners, and end users to ensure rational use, maintenance and sustainability. At the central level the project will work closely with the PRSP Monitoring Unit and with the MDG needs assessment undertaken by the Government with support from the UN to assess achievement of the water MDG and inform policy formulation on the water code and legislation on water user associations;

iv. Health and sanitation training will ensure that the water is properly utilized. Key partners will be local NGOs like Zarshedabonu, the Healthy Life Style Centres of the Ministry of Health, and UNICEF, as well as the Regional Environmental Centers.

Implementation. The Chief Technical Advisor (CTA) will provide guidance and support in project implementation. The UNDP Communities Programme will implement the project in close cooperation with national counterparts. Building on its experience as one of the key partners for ECHO and other donors, the project will expand the activities of the Communities Programme to new geographical areas and focus on building national capacities and strategies for achieving the MDG on water.

Resource Requirements. The total cost of this project for the 2005-2007 period is $1,400,000. The project will rehabilitate water supplies and enable rational solid waste management in 35 communities at an average cost of $40,000.

UNDP funding Requested support Total project budget $0 $1,400,000 $1,400,000

Enhancing Cooperation between Kazakhstan and the Russian Federation for Improved Management of the Ural-Caspian Basin

Background. The land and water resources of the UCB are subject to increasing pressures from agriculture, oil and gas industry activities, mining and other users, and the impact of this is

23 accruing most clearly on a reduction in both the amount and quality of water flows reaching the river’s wildlife-rich delta region. The average water flow in the basin (common surface water resources) is equal to 26.3 km3, of which 21.4 km3 comes from Russia. An interstate agreement was signed between Kazakhstan and the Russian Federation in 1992, which provides a working framework for cooperation between the two countries in the economically, socially and environmentally sound development of the UCB.

Goals. This project will improve cooperation between the two riparian states to the Ural- Caspian Basin (UCB) for their mutual economic and social benefit, promoting the sustainable development of the basin.

Significance/Justification. Located in northwestern Kazakhstan, the UCB is the site of some of the most intensive development activities in the country—dominated by the oil and gas industry. The river’s waters are increasingly at risk from industrial pollution, with adverse consequences for agriculture, domestic water users and aquatic ecosystems. The institutional basis for regional cooperation in the management of the UCB is firmly in place, with a UCB Sub- commission established on the basis of a 1992 interstate agreement covering the UCB as well as the Irtysh, Ishym and Tobol Rivers. However, integrated water resources management (IWRM) principles have not yet been applied to the basin’s management. In particular, greater balance is needed between protection of water quality and management of the quantity of both surface and underground waters.

Activities. The project will assist both Kazakhstan and the Russian Federation in incorporating practical applications of IWRM principles into management of the UCB. This will be accomplished through completion of the following activities:

i. Integrated river basin management plan—assess the range of water resources available and their current and prospective uses in the UCB and establish a generic management plan for the water resources of the UCB utilizing geographic information system (GIS) technology.

ii. Planning unit in URB Commission—establish a permanent planning unit comprised of staff from the two riparian countries and attached to the UCB Commission to develop and oversee implementation of an integrated river basin management plan.

iii. Integrated water and environment information system—compile an integrated information system for the UCB, primarily based on existing data, to serve as the basis for well- informed decision making by the UCB Commission and others within the UCB.

Implementation. The Chief Technical Advisor (CTA) will provide guidance and support in project implementation. The project will be implemented through the UCB Commission in collaboration with UNDP and EU/TACIS and in close contact with appropriate authorities in the two riparian countries. The project will be managed as a sub-component of the UNDP/Norway- sponsored Kazakhstan Integrated Water Resources Management Project. Preliminary dialogue has been held with the collaborating partners regarding this proposal, but more detailed discussions will be necessary to finalize project plans.

24 Resource Requirements: The total budget for the project is US$1.5 million for the 2005- 2007 period. UNDP has allocated US$300,000 for the project and is seeking $1,200,000 in co- funding.

UNDP funding Requested additional support Total project budget $300,000 $1,200,000 $1,500,000

25 Annex 1. Major Transboundary River Basins of Central Asia

Basin Riparian Nations Management Agreements Amu Darya Afghanistan, Kazakhstan, 1992 Aral Sea Basin Water Allocation and Kyrgyzstan, Tajikistan, Management (including Syr Darya but not Turkmenistan, Afghanistan); 1993 Aral Sea Basin Program and Uzbekistan 1994 Nukus Declaration on Aral Sea Basin Management (including Syr Darya but not Afghanistan); 1999 Revised Mandate of the International Fund for Saving the Aral Sea (including Syr Darya but not Afghanistan) Chui and Talas Kazakhstan, Kyrgyzstan 2002 Kazakh-Kyrgyz Preliminary Agreement for Joint Use and Management Ili-Balkash Kazakhstan, People’s 2003 Kazakh-Chinese Preliminary Agreement Republic of China for Joint Use and Management Irtysh Kazakhstan, People’s 1992 Kazakh-Russian Joint Use and Protection Republic of China, of Transboundary Waters (covers Ishim, Irtysh, Russian Federation Ural, Tobol and Volga); 2003 Kazakh-Chinese Preliminary Agreement for Joint Use and Management Ishim Kazakhstan, Russian 1992 Kazakh-Russian Joint Use and Protection Federation of Transboundary Waters (covers Ishim, Irtysh, Ural, Tobol and Volga) Syr Darya Kazakhstan, Kyrgyzstan, 1992 Aral Sea Basin Water Allocation and Tajikistan, Uzbekistan Management (including Amu Darya); 1993 Aral Sea Basin Program and 1994 Nukus Declaration on Aral Sea Basin Management (including Amu Darya); 1998 Framework Agreement on Rational Water and Energy Use; 1999 Revised Mandate of the International Fund for Saving the Aral Sea Tobol Kazakhstan, Russian 1992 Kazakh-Russian Joint Use and Protection Federation of Transboundary Waters (covers Ishim, Irtysh, Ural, Tobol and Volga) Ural Kazakhstan, Russian 1992 Kazakh-Russian Joint Use and Protection Federation of Transboundary Waters (covers Ishim, Irtysh, Ural, Tobol and Volga) Volga Kazakhstan, Russian 1992 Kazakh-Russian Joint Use and Protection Federation of Transboundary Waters (covers Ishim, Irtysh, Ural, Tobol and Volga)

26 2. Key References on Regional Cooperation and Water Management in Central Asia

Asian Development Bank (ADB). 1997. Central Asian Environments in Transition. Manila.

ADB. 1998. Regional Economic Cooperation in Central Asia. Manila.

ADB. 2002a. Supporting Environmental Cooperation in Central Asia. Manila.

ADB. 2002b. Cooperation in Shared Water Resources in Central Asia: Past Experience and Future Challenges, Proceedings of a Regional Workshop, Almaty, Kazakhstan 26–28 September 2002, ADB: Manila.

ADB. 2003. Technical Assistance for Improved Management of Shared Water Resources in Central Asia, ADB: Manila.

Bucknall, et al. 2003. Irrigation in Central Asia: Social, Economic and Environmental Considerations, World Bank: Washington.

Central Asia Regional Environment Center (CA-REC). 2001. Decision Making System in the Field of Environmental Protection in Central Asia. CA-REC: Almaty.

Dukhovny, Victor A. and Vadim Sokolov. 2001. Integrated Water Resources Management in the Aral Sea Basin, Scientific Information Center of the Interstate Commission for Water Coordination in the Aral Sea Basin: Tashkent.

Global Water Partnership. 2003. GWP Central Asia and Caucasus Regional Strategy and Work Program for 2004-2008, GWP/CACENA: Tashkent.

Hodgson, Steven. 2000. Kyrgyz Republic International Watercourse Law: Report of a Preliminary Visit to Bishkek for the UK Department for International Development, DFID: Bishkek.

International Fund for Saving the Aral Sea (IFAS). 2002. Water and Environmental Management Project Sub-Component A1: National and Regional Water and Salt Management Plan Phase III Report – Regional Needs and Constraints. GEF Agency of the IFAS Aral Sea Basin Program: Tashkent.

IFAS. 2003. Program on Concrete Actions on Improvement of the Environmental and Socio- economic Situation in the Aral Sea Basin for the Period of 2003-2010 (ASBP-2), IFAS: Dushanbe.

IFAS. 2003. Aral: The History of a Dying Sea, EC-IFAS: Dushanbe.

Kemelova, Dinara and Gennady Zhalkubaev. 2003. “Water, Conflict and Regional Security in Central Asia: Revisited” New York University Environmental Law Journal, Vol. 11, No. 1.

McCauley, David. 2004 (in press). Environmental Management in Independent Central Asia, in In the Tracks of Tamerlane: Central Asia’s Path into the 21st Century, D. Burghart and T. Sabonis- Helf (eds.), National Defense University Press: Washington, DC.

27 McKinney, Daene. 2004 (in press). Cooperative Management of Transboundary Water Resources in Central Asia, in In the Tracks of Tamerlane: Central Asia’s Path into the 21st Century, D. Burghart and T. Sabonis-Helf (eds.), National Defense University Press: Washington, DC.

PA Consulting. 2003a. Natural Resource Management Program Transboundary Water and Energy Project: Short Briefing Note, USAID/Central Asia: Almaty.

PA Consulting. 2003b. Proposals For Improved Water And Energy Management In The Syr Darya River Basin: Discussion Note, USAID/Central Asia: Almaty.

Rathnam, Michael and Eric Sievers. 2003. Central Asian Water Mission: Final Report and Recommendations, UNDP Regional Bureau for Europe and the CIS: New York (draft).

Sievers, Eric W. 2002. “Water, Conflict and Regional Security in Central Asia” New York University Environmental Law Journal, Vol. 10, No. 3.

Tabyshalieva, Anara. 1999. The Challenge of Regional Cooperation in Central Asia: Preventing Ethnic Conflict in the Ferghana Valley, United States Institute of Peace: Washington, DC.

Task Force for the Preparation of World Summit on Sustainable Development (WSSD) in Asia and the Pacific. 2001. Central Asia Subregional Report for the World Summit on Sustainable Development. ADB, ESCAP, UNDP, UNEP: Bangkok.

UN Economic Commission for Europe (UNECE), 2003. Invitation to Partnership on Implementation of the Central Asian Sustainable Development Initiative, Fifth Ministerial Conference Environment for Europe, Kiev, 21-23 May 2003, UNECE: Geneva.

UNECE/ESCAP. 2004. Strengthening Cooperation for Rational and Efficient Use of Water and Energy Resources in Central Asia, Special Programme for the Economies of Central Asia (SPECA), Project Working Group on Energy and Water Resources, United Nations: New York.

United Nations Environment Program (UNEP). 2001. Regional Environmental Action Plan for Central Asia. UNEP.RRA, UNDP and ADB: Bangkok.

UNDP. 2003. Sub-regional Strategy for Central Asia: 2003-2005, UNDP: New York.

World Bank. 2004a. Water and Energy Nexus in Central Asia: Improving Regional Cooperation in the Syr Darya Basin, The World Bank Europe and Central Asia Region: Washington DC.

World Bank. 2004b. International Donor Conference on Water and Energy Cooperation in Central Asia: Record Note, February 25-26, Washington DC.

World Bank. 2004c. Creation of a Water-Energy Consortium, Invited comments presented to the Central Asian Cooperation Organization (CACO), 24 May, 2004.

28 Annex 3. Options for Formation of a Water and Energy Consortium

WATER-ENERGY CONSORTIUM: WHAT FORM SHOULD IT TAKE ?

INTENSITY OF REGIONAL COOPERATION / INTEGRATION

A Group of An International An International National Experts (i.e. multi-country) Holding that Owns Empowered by A Forum for JSC that Operates and Operates the their Governments Discussion of the Nationally- Assets associated to Sign Inter- Water-Energy owned Assets with Water & Governmental Trade Issues ? associated with Energy Trade in Agreements on Water & Energy the Different Water & Energy Trade ? Countries ? Trade ?

1 2 3 4

Coordinate national and/or Operates the assets according internationally-funded to regionally agreed rules research on issues of mutual (water flows and power plants) In addition to (3): interest (water-energy In addition to (1): exchanges, harmonization of Negotiate and sign national Decides on least-cost regional legal framework and Negotiate and sign Inter- and international fuel investment policy and on regulatory policies and Governmental Agreement(s) purchases and power sales / individual projects in the practices, feasibility of new on water-energy trade power transmission countries concerned investments projects) agreements Monitor implementation by the Finance, including through Seek financing for projects of parties Finance operation and borrowing in its own corporate regional significance maintenance of existing name, investments in existing Report to individual assets and in new assets Debate possible solutions at governments on breaches, if the technical level and tries to any, of the signed agreements Prepare detailed feasibility Owns and operates the new reach consensus for individual governments to studies for rehabilitation and assets take appropriate actions new investment for Present recommendations for consideration by the owners of each National Government to the assets consider and act upon

Possible evolution over time ?