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Karzai seeks foreign investment on India trip

Published Nov 13, 2012 03:58am

Karzai-Singh-AFP-670
Afghanistan President Hamid Karzai (L) shakes hands with Indian Prime Minister Manmohan Singh after the signing of agreements in New Delhi on November 12, 2012. — Photo by AFP

NEW DELHI: President Hamid Karzai said on Monday that Afghanistan was confident in its future and ripe for foreign investment as he touted for Indian business despite continuing unrest in his war-torn country.

After holding talks with Indian Prime Minister Manmohan Singh in New Delhi, Karzai said international companies should seize the chance to invest in his country ten years after the fall of the Taliban regime.

“Investment opportunities in Afghanistan today are better in a country that is more confident in its future and is willing to receive investment from its friends, particularly India,” he told reporters.

“My visit this time to India is focused particularly in talking to and requesting Indian businesses to come to Afghanistan.”

India has given $2 billion in aid to Afghanistan since the Taliban were ousted. It is keen to invest more to tackle chronic instability and prevent the return of hardline rulers after international troops pull out in 2014.

But any Indian activity in Afghanistan triggers sensitivities in neighbouring Pakistan, which fears losing influence in Afghanistan and being encircled.

In a reference to Pakistan-based militants who fuel the Afghan insurgency, Singh said sustained international cooperation “including in combating terrorism emanating from the neighbourhood” would help Afghanistan.

“India remains committed to supporting Afghanistan in its development efforts,” Singh said.

“We have expanded our programmes for capacity-building, institution-building and human resource development in Afghanistan.”

The two leaders signed memorandums of understanding on aid for small development projects, youth affairs and coal mining.

In October last year India and Afghanistan began a “strategic partnership” aimed at deepening security and economic links, with Karzai keen to elevate India's involvement further.

At a weekend meeting with business leaders in Mumbai, he promised a “red carpet” welcome for Indian investment as US-led coalition forces prepare to withdraw.

“Indian businesses need not be shy while thinking about Afghanistan,” he said. “Chinese businesses were there long before you came, five or six years ago.” India has not contributed to the international forces deployed in Afghanistan, but has worked on low-key troop and police training as well as infrastructure development.

Last year a consortium of Indian companies won the right to develop Afghanistan's largest iron ore deposits, underscoring growing ties between the two countries.

The United States was previously wary of India's presence in case it led to a “proxy war” with Pakistan on Afghan territory, though US Defence Secretary Leon Panetta recently encouraged India to play a more active role.

Afghanistan is believed to have mineral reserves worth at least $3 trillion which could generate billions of dollars in tax revenue.

The Indian Express newspaper on Monday called for Premier Singh to provide more logistical support and training to Afghan security forces to protect India's own position.

“Short of sending combat troops into Afghanistan, India must offer all the military assistance it can to beef up Kabul's capacity to defend itself,” it said.

“Further hesitation on Delhi's part can only undermine India's ability to secure its long-term interests... and its reputation as a credible regional power.”