The Eurasian Development Bank (EDB) plans to invest at least $400mn in water and energy infrastructure in Central Asia over the next three years in an effort to boost economic growth and improve food security, EDB’s board chairman Nikolai Podguzov said at the United Nations Water Conference.

The issue of water resources sufficiency and depletion has been a central topic in Central Asia since the mid-1980s. It has become more acute as the pace of global warming in the region, which is home to nearly 80mn people, exceeds the global average, posing risks to food, energy and environmental security.

EDB, which is headquartered in Kazakhstan’s city of Almaty and counts Tajikistan and Kyrgyzstan among its members, expects that addressing current challenges in water and energy infrastructure in Central Asia will boost regional GDP growth by an additional 1.5 percentage points a year.

“The introduction of modern irrigation technologies and the modernisation of irrigation systems will increase the efficiency of water use by 40%. It will also lead to security of agricultural production, a critically important factor for regional food security,” Podguzov told the Water Conference in New York.

Podguzov expressed support for a collaborative approach to tackling dwindling water supplies in a region with a fast-growing population. He emphasised the importance of regional co-operation and the collective efforts of multilateral development banks (MDBs) and other international financial organisations to address this issue.

“There is a lot to do. We are looking forward to working together with other MDBs and, of course, national governments in our member states. I believe that our joint efforts will adequately address long-term water challenges in Central Asia,” Podguzov said.

At the conference, which was co-hosted by the governments of Tajikistan and the Netherlands, Podguzov said the water and energy nexus is among the EDB’s key priorities in the medium term. He also said he was confident of the support of regional authorities to aid the development of this initiative.

The EDB, which is also a leading regional think-tank and mediator of expert dialogue, attributes the region’s low efficiency in water and energy usage – and the resulting high economic costs – to inadequate investment in the water and energy sectors and insufficient regional co-operation among Central Asian states.

“Effective regulation and development of the CA water and energy complex is a tough challenge,” EDB said in a report on Regulation of the Water and Energy Complex of Central Asia. The EDB suggested that Central Asian states should develop an “ecosystem” of regional institutions and organisations working in the water and energy spheres.

In its report, the EDB said it would be economically feasible to establish an International Water and Energy Consortium of Central Asia (IWEC), which could become a fully-fledged international organisation or a project investment consortium.

 This article first appeared in New Economy Observer (NEO), a digital publication covering the intersection between finance and social responsibility, with a special focus on emerging markets. It offers news and analysis on major issues shaping the new global economy, including climate change and renewable energy, sustainable development, e-commerce and tech innovation, and the future of work.