DAYS AFTER THE Taliban takeover of Afghanistan, the World Bank and the International Monetary Fund halted the flow of hundreds of million dollars into the country. The central bank had around $9 billion in reserves. But, most of it was held in the US and was frozen. In short, the Taliban was left without capital to run the country.
But, not many know that the country has mineral deposits worth $1 trillion or more, including rare earth minerals. It supposedly has the world’s largest reserves of lithium. However, the Taliban does not have the expertise to mine it. It needs a business-minded partner who is not too concerned about ideology. Enter China.
Beijing can offer what Kabul needs most: impartiality and economic investment,” Zhou Bo, who was a senior colonel in the People’s Liberation Army (2003-2020), wrote in The New York Times. “Afghanistan in turn has what China prizes most: opportunities in infrastructure and industry building—areas in which China’s capabilities are arguably unmatched—and access to $1 trillion in untapped mineral deposits, including critical industrial metals such as lithium, iron, copper and cobalt.”
He also wrote that Chinese companies have a reputation for investing in less stable countries if they can reap the rewards. China had even engaged with the Taliban administration in 1999. The state-backed Global Times recently wrote that Chinese companies could deliver investment and technical support. Afghanistan’s reserves could be a jackpot for anyone who is able to mine it. And it seems like China is in pole position. If things work out, Afghanistan could well join the Belt and Road Initiative (BRI).
Mining in Afghanistan has been attempted before. In 2007-2008, Chinese firms signed deals to mine copper in the Logar province, not far from Kabul. But, the project was a non-starter. “In mining, you need constant power supply and security for personnel,” said Avinash Godbole, associate professor of international relations and Chinese studies at Jindal Global University. “You also need water supply for the plant. These were major challenges on the technical front there.”
The Taliban, at least for now, is projecting a moderate version of itself, but that alone is not enough to guarantee stability. The country could descend into chaos even if there is conflict between the various warlords. “China’s first concern would be that the Taliban does not influence the [Uighur] people in Xinjiang, and second [would be] protecting its investments in Pakistan (renewed instability in Afghanistan could threaten Chinese investments in Pakistan),” said Godbole. “China will wait and watch before making any big announcement.”
