Cablegate: Afghanistan's Fiber-Optic Cable: Problems and Prospects

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PP RUEHDBU RUEHPW RUEHSL
DE RUEHBUL #3767/01 3281522
ZNR UUUUU ZZH
P 241522Z NOV 09
FM AMEMBASSY KABUL
TO RUEHC/SECSTATE WASHDC PRIORITY 3385
RUEHDBU/AMEMBASSY DUSHANBE 0139
RUEHNT/AMEMBASSY TASHKENT 0029
RUEHIL/AMEMBASSY ISLAMABAD 8121
RUEKJCS/SECDEF WASHINGTON DC
INFO RUCNAFG/AFGHANISTAN COLLECTIVE

UNCLAS SECTION 01 OF 02 KABUL 003767

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DEPT FOR SCA/FO, SRAP, SCA/RA, EEB/CIP AND SCA/A
DEPT PASS AID/ANE
DEPT PASS OPIC FOR MORRIS

E.O. 12958 N/A
TAGS: ECPS EINV PREL AF
SUBJECT: AFGHANISTAN'S FIBER-OPTIC CABLE: PROBLEMS AND PROSPECTS

Ref: KABUL 2920

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1. (SBU) Summary: Afghan officials have reported for months that a
fiber-optic cable would soon link Afghanistan's population centers
and neighboring countries, but they now admit the cable is far from
complete and international connections rarely function. Uzbekistan
and Tajikistan continue to charge exorbitant prices for traffic,
resulting in a wholesale price per gigabyte at least 50,000 times
(sic) greater than in some developed countries, according to
Minister of Communications and Information Technology Amir Sangin.
Security concerns have also prevented cable construction in the
South. Afghan officials and private sector leaders recognize the
value of the cable and broadband Internet service but will need USG
help to market this valuable product and to conclude agreements with
Afghanistan's neighbors. End Summary.

Fiber-Optic Cable Construction: Domestic Delays
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2. (SBU) The ongoing fiber-optic cable project connecting
Afghanistan with its neighbors is critically needed to lower the
cost of Internet service. The Ministry of Communications and
Information Technology (MCIT) has issued licenses to 20 Internet
service providers, but reliance on expensive satellite links has
kept broadband Internet out of reach for most Afghans. MCIT
Minister Amir Sangin reported November 21 that the cable extends
from Kabul to Herat and into some eastern provinces, but
construction south of Kabul has stopped indefinitely due to security
along the route. The Kabul-Jalalabad portion of the cable is
especially important because it connects to Pakistan, one of few
international routes for Internet traffic. Road construction has
accidentally cut the cable between Kabul and Jalalabad several times
(reftel), but USAID contractors have repaired cuts that are their
responsibility. Sangin said the Ministry of Public Works-sponsored
rebuilding of the Saracha Bridge on the Kabul-Jalalabad route cut
the cable yet again, but workers quickly repaired it and he expects
the cable to resume operation shortly.

Greedy Neighboring Countries
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3. (SBU) State-owned Afghan Telecom, the cable's owner, has
negotiated with Tajikistan and Uzbekistan for months to arrange
alternative international service via their cables. Sangin said
Uzbekistan committed to provide service in late summer, but then
doubled its price, delaying service until November 22, when traffic
began flowing. Tajik authorities signed an agreement to connect
their cable with Afghanistan's and are receiving payment, but are
not actually providing service. Sangin said he was shocked on a
recent trip to Hong Kong to hear broadband service there costs $13
per gigabyte per month. Pakistan, the cheapest bandwidth provider
for the Afghan cable, charges $650,000 (sic) per gigabyte per month,
while Uzbekistan and Tajikistan charge $950,000 and $1 million (sic)
per gigabyte per month, respectively. He concluded that this
explains why it is unlikely Internet will ever achieve the same
penetration in Afghanistan as in nearby countries.

Plenty of Customers, Not Enough Salespeople
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4. (SBU) The cable's largest customers are currently military
entities, which previously relied on expensive satellite service to
send data to headquarters in Europe and the Middle East. U.S.
Forces Afghanistan (USFOR-A) is now connected to Germany via the
Uzbek link. Despite the cable's revenue potential, Afghan Telecom
has struggled to lease space on the cable to commercial customers
due to its low managerial capacity. The World Bank previously
supported salaries for experienced, expatriate managers, but that
assistance expired in October.

Comment: The Way Forward
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5. (SBU) Minister Sangin has indicated that concluding
international agreements for cable traffic is his top priority and
requested assistance through USAID's Economic Growth and Governance
Initiative (EGGI) program. EGGI advisors will assist Afghan Telecom
in preparing a business plan and advancing optical fiber agreements
with neighboring countries. Additionally, USFOR-A is considering
supporting an advisor to Afghan Telecom to build its technological
and business capacity. Properly managed, the cable is Afghan
Telecom's most valuable asset and therefore more attractive
potential target for privatization in the future. End Comment.

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