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New Delhi-Islamabad-Kabul: Can they make borders irrelevant?
Manish Vaid
21 November 2012

Afghan President Hamid Karzai's statement 'Bharat sabse achcha mulk hai'('India is the best country'),given in Hindi to a meeting of Indian business leaders in Mumbai on 10 November 2012, was a clear reiteration of how important New Delhi is for Kabul -strategically, economically and culturally. The pitch for greater Indian investment in Afghanistan was a leading theme of President Karzai's recent four-day trip to India. He offered a red carpet welcome to Indian businesses moving into Afghanistan and the two governments signed agreements to facilitate greater co-operation in the areas of coal mining, small development projects, fertilisers and youth affairs.

While India's commitment to the rebuilding and reconstruction efforts in Afghanistan was reinforced by the visit, President Karzai ensured that he did not rub Pakistan up the wrong way, no doubt keeping in mind Islamabad's importance in the post-2014 environment and the fact that the latter is already sceptical about New Delhi's role in Kabul. It was precisely for this reason that Karzai's speech not only heaped praise on India, but also lauded Pakistan for easing trade between India and Afghanistan. During a visit to Delhi in October 2011, the Afghan President had been equally careful to speak about the necessity for a more harmonious relationship between New Delhi and Islamabad and spoke of thinking in terms of a New Delhi-Islamabad-Kabul-Tehran partnership.

Post-2014, Afghanistan will undoubtedly rely more on both India and Pakistan for any peace process to have lasting effect. An improved bilateral trade relationship with India and Pakistan in recent times has not only gone a long way towards stabilising the South Asian region, but also in opening up more avenues for direct Afghan trade with India. According to Afghanistan's Commerce and Industry Minister Anwar-ul-Haq Ahady, Afghanistan is keen to trade with India via Pakistan, through the Wagah-Attari border and has asked Pakistan to work out the mechanisms needed to boost its economic engagement in South Asia.

India has already pledged US$2 billion in assistance to Afghanistan. New Delhi identified Afghanistan as a gateway to energy integration with the Central Asian region, after it signed agreements in May this year with the other countries participating in the Turkmenistan-Afghanistan-Pakistan-India gas pipeline. The Afghan Ministry of Mines has already shortlisted India's ONGC Videsh Limited, along with Exxon-Mobil of the United States, Kuwait Energy and Turkey's TPAO for six exploration blocks in the western portion of the Afghan-Tajik basin, in the north of Afghanistan. New Delhi is anxious to secure tenements as close as possible to the border with Turkmenistan, which has the fourth-largest gas reserves in the world, in the chance that those reserves will extend into the blocks on the Afghan side. Though the mineral potential of Afghanistan is yet to be established, it is estimated to harbour up to three trillion dollars'worth of mineral wealth from gold, copper, iron ore and precious stones to oil, gas and rare earth minerals.

In the past, India has partnered with Uzbekistan in supplying electricity to Kabul. The former erected the transmission network, while the later supplied the power. The Shanghai Co-operation Organisation (SCO) has, of late, voiced its appreciation of India's contribution in Afghanistan, while India has pitched for a larger SCO role in Afghanistan.

The above underlines India's objective of connecting South and Central Asia through Afghanistan, seeing the importance of Kabul in not only ensuring stability and promoting trade in the South Asian region, but also in offering a huge energy market for the Central Asian region.

Afghanistan has attempted to ensure transparency in its legal and fiscal reforms so as to attract foreign direct investment as an eventual replacement for foreign aid. This time, too, President Karzai highlighted the brighter investment opportunities at present and sought to receive recognition of that from India. He stated that,'Indian businesses need not be shy while thinking about Afghanistan.'

Now is yet another opportunity for the United Progressive Alliance coalition government of Dr Manmohan Singh (or "UPA-2") to enthusiastically accept Afghanistan's invitation and to explore the investment opportunities next door.

It is time to recall Prime Minister Singh's vision of a day when one can have breakfast in Amritsar, lunch in Lahore and dinner in Kabul. But, for that to happen, New Delhi has to ensure that the thaw with Pakistan lasts and that economic engagement between the two countries continues to accelerate, as it has over the past year or so.

(Manish Vaid is a Research Assistant at Observer Research Foundation, New Delhi)

Courtesy: Strategic Weekly Analysis