Date: 18/04/2023

Relevance: GS-2: India and its Neighbourhood- Relations.

Key Phrases: Afghanistan's infrastructure sector, India-Afghan business initiatives, ‘Afghan Invest’ consortium, Afghan Chamber of Industries and Mines, Shaberghan to Dasht e Alwan, Chabahar, Central Asian Road network, Afghan-India Friendship Dam.

Why in News?

• The recent changes in regional dynamics due to the understanding between Iran and Saudi Arabia have provided a new opportunity for India to restart its works in Afghanistan's infrastructure sector.
• The Taliban administration is keen on bringing investment and restarting the Afghan economy and is reaching out to India to complete the remaining work on a major electricity project.
• Pro-Taliban sources have urged India to sense the unfolding regional equations and restart its projects and take new initiatives to improve India-Afghan business initiatives.

Investment:

• The main challenge in the last few years was to ensure security and flow of finances, and both these factors are being addressed.
• ‘Afghan Invest’ consortium was inaugurated with a reported capital of $250 million in Kabul in the summer of 2022 and consists mainly of Afghan business houses based outside the country.
• It has 13 major companies, which are trying to partner with the Taliban administration to bring in investment into the country.

Restarting a Major Electricity Project

• The Taliban's "Deputy Prime Minister for Economic Affairs," recently met with the Afghan Chamber of Industries and Mines (ACIM) to discuss restarting a major electricity project that was being built by an Indian entity till August 2021.
• The project, which connects Shaberghan to Dasht e Alwan, is 90% complete, and the Taliban administration is now reaching out to the Indian company to complete the remaining work as electricity demand is high in Afghanistan.
• Private Afghan investors are planning to bring in the finance for completing the electricity project, and the Taliban administration will pay back by leasing mines to the stakeholder companies.

Infrastructure and Connectivity:

• Infrastructure and connectivity are major concerns for Afghanistan, and there is a need to ensure access to Chabahar and allow Kabul to use the Central Asian Road network, which will enable Afghanistan to emerge as a transit point for trade between India, Central Asia, Iran, Russia, and even China.
• At present, Afghanistan has access to China through Pakistan, which takes more than a month to travel due to administrative difficulties. An alternative route through Central Asia would reduce travel time significantly.
• Central Asian countries, particularly Uzbekistan and Turkmenistan, are at the forefront of introducing changes on the ground in Afghanistan, and India should sense the unfolding regional equations and restart the projects that it left behind and take new initiatives.

Educational Ties:

• Afghanistan has urged India to normalize commercial, business, and educational ties so that Afghan students can resume studies and India-Afghan business initiatives can take off.
• Afghanistan is in dire need of education, and India has a well-established education system, making it an ideal partner to improve the educational infrastructure in Afghanistan.

India's Investments in Developmental and Capacity-building Projects in Afghanistan

• India's Investments in Major Projects:
  • India has made investments of approximately three billion dollars in developmental and capacity-building projects in Afghanistan.
  • India has provided support to several major projects in Afghanistan, including the inauguration of the 42MW Salma Dam in Herat province, which is commonly referred to as the Afghan-India Friendship Dam.
  • India also constructed the Afghan Parliament in Kabul at a cost of $90 million.
• Infrastructure Projects in Afghanistan:
  • India has been actively involved in infrastructure development in Afghanistan. One of the notable projects is the construction of the 218-km Zaranj-Delaram highway by the Border Roads Organisation. Zaranj is situated near Afghanistan's border with Iran.
• Education and Training in Afghanistan:
  • India has been actively involved in training professionals and offering scholarships and admissions to Afghan students to study in India.
• India's Response to the Humanitarian Crisis in Afghanistan:
  • India has expressed profound concern over the evolving humanitarian crisis in Afghanistan and has taken steps to provide humanitarian assistance.
  • This includes donations of 40,000 MTs of wheat, approximately 50 tonnes of essential medical aid such as lifesaving medicines and anti-TB medicines, 500,000 doses of COVID vaccine, essential medical/surgical items, and 28 tons of other disaster relief material.

The Chinese Advantage:

• The Chinese are fast taking advantage of the changed ground rules in Kabul.
• There are thousands of Chinese engineers working across Afghanistan at present, and apart from gold, chromite, and zinc, there is a vast deposit of lithium in Ghazni, Nooristan, and Helmand, and the Chinese are exploring these regions.

Conclusion:

• With the recent changes in the region, Afghanistan presents a unique opportunity for India to revive its work in the infrastructure sector.
• Connectivity and infrastructure are major concerns for Afghanistan, and India should take advantage of the situation and restart its projects that were left behind.
• As the Chinese are fast taking advantage of the changed ground rules in Kabul, it is crucial for India to act fast and normalize its ties with Afghanistan.

Source: The Hindu

Mains Question

Q. Discuss the opportunities and challenges for India in restarting energy and educational ties with Afghanistan in the current regional situation.