Afghanistan is seeking increased investment and trade with India as a Taliban delegation, led by Commerce Minister Haji Nooruddin Azizi, concluded a visit to New Delhi this week, officials said on Thursday. The Afghan side is notably interested in securing preferential access for its goods to the Indian market and attracting Indian companies to invest in sectors like agriculture, mining, and infrastructure.
The visit marks a significant step in cautiously rebuilding economic ties between the two countries following the TalibanS takeover in August 2021. While India has not formally recognized the Taliban government, it has maintained diplomatic contact and provided humanitarian aid. This renewed focus on economic engagement reflects India’s strategic interests in afghanistan’s stability and its desire to counter pakistan’s influence in the region, while Afghanistan desperately needs economic support to avert a deepening humanitarian crisis and rebuild its economy.
Azizi met with Indian officials, including representatives from the Ministry of External Affairs and the Federation of Indian Chambers of Commerce & Industry (FICCI), to discuss potential investment opportunities and trade facilitation measures. According to a statement released by the Afghan embassy in delhi, key discussion points included easing visa restrictions for Afghan traders, establishing a direct payment mechanism to bypass international banking challenges, and exploring opportunities for joint ventures.
“We discussed a range of issues related to enhancing trade and investment between Afghanistan and India,” an Afghan official said, requesting anonymity. “We are hopeful that India will consider our requests for preferential treatment and increased investment.”
India was previously a major investor in Afghanistan, with commitments exceeding $3 billion before the Taliban’s ascent. Trade between the two nations stood at around $1.3 billion in the fiscal year 2020-21, but has significantly decreased since. Key Afghan exports to India include dried fruits, fresh fruits, and medicinal plants, while India primarily exports essential commodities, pharmaceuticals, and machinery to Afghanistan.
Despite the potential benefits, challenges remain.Concerns over human rights, particularly the treatment of women and minorities under Taliban rule, continue to weigh on India’s engagement. The international community’s reluctance to recognize the Taliban government also complicates financial transactions and investment flows. However, India appears to be prioritizing pragmatic engagement to safeguard its interests and provide much-needed economic assistance to Afghanistan.