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India’s Afghan investment

Topics Covered: Effect of policies and politics of developed and developing countries on India’s interests, Indian diaspora.

India’s Afghan investment:


India is concerned because of the ongoing crisis in Afghanistan.

After the exit of US and NATO forces, Taliban is capturing many parts of the nation.

India is worried because:

  1. It may have no role to play in that country, and in the worst case scenario, not even a diplomatic presence.
  2. That would be a reversal of nearly 20 years of rebuilding a relationship that goes back centuries.
  3. The Taliban’s possible triumph also threatens $3 billion worth of Indian investment in various projects — dams, roads, trade infrastructure.


India’s assistance to Afghanistan:

No part of Afghanistan today is untouched by the 400-plus projects that India has undertaken in all 34 of Afghanistan’s provinces.

  1. The 2011 India-Afghanistan Strategic Partnership Agreement recommitted Indian assistance to help rebuild Afghanistan’s infrastructure and institutions; education and technical assistance for capacity-building in many areas.
  2. SALMA DAM: The 42MW Salma Dam in Herat province. The hydropower and irrigation project, completed against many odds and inaugurated in 2016, is known as the Afghan-India Friendship Dam.
  3. ZARANJ-DELARAM HIGHWAY: The other high-profile project was the 218-km Zaranj-Delaram highway built by the Border Roads Organisation. Zaranj is located close to Afghanistan’s border with Iran. The $150-million highway goes along the Khash Rud river to Delaram to the northeast of Zaranj.
  4. PARLIAMENT: The Afghan Parliament in Kabul was built by India at $90 million. It was opened in 2015; Prime Minister Narendra Modi inaugurated the building.
  5. STOR PALACE: In 2016, Afghan President Ashraf Ghani and Prime Minister Modi inaugurated the restored Stor Palace in Kabul, originally built in the late 19th century, and which was the setting for the 1919 Rawalpindi Agreement by which Afghanistan became an independent country.
  6. India pledged $1 million for another Aga Khan heritage project, the restoration of the Bala Hissar Fort south of Kabul, whose origins go back to the 6th century. Bala Hissar went on to become a significant Mughal fort, parts of it were rebuilt by Jahangir, and it was used as a residence by Shah Jahan.
  7. Despite the denial of an overland route by Pakistan, India-Afghanistan trade has grown with the establishment in 2017 of an air freight corridor. In 2019-20, bilateral trade crossed $1.3 billion.


Why is Afghanistan important for India?

  • Afghanistan is vital to India’s strategic interests in the region.
  • It is also perhaps the only SAARC nation whose people have much affection for India.


Insta Curious: 

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Prelims Link:

  1. Overview of Indian projects in Afghanistan.
  2. Location of these projects.

Mains Link:

Discuss why a stable political situation in Afghanistan is significant for India.

Sources: Indian Express.