New Delhi [India], November 24 : Afghanistan has offered its long-idle mining sites to India for exploration as part of its efforts to deepen economic engagement and generate local employment, but the Indian industry body Associated Chambers of Commerce and Industry of India (ASSOCHAM) has responded cautiously, noting that mining remains a "bit more difficult" and requires detailed geological groundwork before any investment can move ahead.
Addressing media persons after a high-level meeting with an Afghan delegation, ASSOCHAM Secretary General Manish Singhal said, "They did mention that they have lots of mines in Afghanistan which was also actually explored decades back, but now they are not functioning." He added that the Afghan side was open to Indian participation, saying, "So they said that they will be happy to offer those mines to Indian mining companies."
Afghanistan has over 1,400 mineral fields, containing barite, chromite, coal, copper, gold, iron ore, lead, natural gas, petroleum, precious and semi-precious stones, salt, sulfur, lithium, talc, and zinc, among many other minerals. Gemstones include high-quality emeralds, lapis lazuli, red garnet and ruby.
According to a joint study by the Pentagon and the United States Geological Survey, Afghanistan has an estimated USD1 trillion of untapped minerals.
During the meeting, the Afghanistan delegate was also referring to idle gold mines in the country. Afghanistan has significant untapped gold deposits, but many known gold mine sites remain idle due to a lack of infrastructure, technical expertise, and security concerns, though the current government is trying to attract investment.
Explaining Afghanistan's intention of inviting private players from India in the mining sector, Singhal said, "So that Indian mining companies can draw those minerals and bring them back to India, or they can export elsewhere from Afghanistan."
However, Singhal underlined the practical challenges involved in the mining business. He said, "For investment, they largely spoke of mining is one area, but we all understand that is a bit more difficult because mining companies will have start with geological surveys which takes time."
The ASSOCHAM interaction took place during the visit of Alhaj Nooruddin Azizi, Minister of Industry and Commerce of Afghanistan. Singhal said the minister had come with a clear agenda for economic cooperation.
"He obviously is here to talk about more trade and investment between India and Afghanistan," Singhal said, adding that the Afghan side stressed on the improving conditions in their country: "He also shared how the ground situation of Afghanistan is changed, which is much more useful and helpful in terms of safety, in terms of movement of people."
Singhal emphasized that India and Afghanistan continue to share a strong and warm relationship. Conveying the sentiment expressed by the Afghan side, he said, "I would rather buy things from India than other countries because India, Afghanistan, as you know, has very strategic and warm relationship. Whatever happened in Afghanistan, India was continuously supporting the country."
Trade formed a significant part of the discussion. Singhal said, "We do around USD1 billion of trade with Afghanistan, out of which 70% or import to India and just about 30% or exports. What we understood in the meeting today is India can export much more to Afghanistan."
He said if Indian companies take more initiatives trade between India and Afghanistan could increase.
Items Afghanistan imports from elsewhere, such as small manufactured goods, food products including rice, and pharmaceutical items, could be sourced competitively from India.
Afghanistan also requested support from Indian companies in local value addition. Singhal explained, "Let's say we are importing nuts, saffron and hing from Afghanistan. Right now, it's all come to India and packaged here. They requested us to build capacity there and teach local people how to do the packaging."
Smooth financial channels remain essential for expanding trade. Singhal said, "We just need to look at very, very smooth banking channels. Afghan banks and Indian banks which are have interbank relationships... we just need to rejuvenate them so trading company, importers and exporters don't face any problem."
Visa processes for business travel are also being eased. Singhal said, "We used to have lots of Afghan traders coming to India till few years back. So we invited them and told that visas and all will be streamlined."