Developing economy India has forged a memorandum of
understanding (MoU) with Afghanistan which outlines a cooperation
for the development of the war-torn country's iron and steel
Indian steel minister Shri Beni Prasad Verma went to Kabul to
sign the MoU on Monday with Afghan mines minister Wahidullah
In a press conference, both Verma and Shahrani said the MoU
permits Indian state and private firms to mine iron ore as well
as invest in future steel production in Afghanistan. Shahrani
hoped the Indian state and private firms will be likewise willing
to invest and provide vocational training for Afghan workers in
ore extraction and steel technologies, Radio Free Europe/Radio
Verma noted in the same press conference that India is
likewise interested to invest in natural gas and oil in
The MoU signified India's strong desire in joining a global
race to secure mineral assets, such as iron ore, and more lately,
gold and copper in Afghanistan. In November, Kabul awarded
to a consortium of seven Indian companies, led by
state-owned Steel Authority of India (SAIL), the mining
rights to develop the huge Hajigak deposit in
Located in Bamyan Province, the iron ore rich Hajigak mine
holds the best known and largest iron oxide deposit in
Afghanistan. It extends over 32 kilometres and covers 16 separate
zones, up to 5 kilometres in length, 380 metres wide and
extending 550 metres down. The mine could give up to $6 billion
to the government's coffers.
On May, the SAIL consortium and Afghanistan government are
expected to sign a final agreement that will pave the way for the
development of the Hajigak iron ore mine, including building a
steel and power plant there.
"The negotiations on Hajigak's contract details, which include
building of rail road, steel industry, power plant and others,
would be finalized at the end of May and the final contract may
be signed in May this year," Shahrani said.
The Afghan government, eager to rebuild its nation as well as
attract foreign direct investment, had been proclaiming it holds
an estimated $3 trillion in natural resources. The deposits,
which yield copper and iron ore, oil and gas, niobium, cobalt,
gold, molybdenum, silver and lithium, could lift the country's
coffers by some $3.5 billion a year.
The Hajigak mine holds an estimated two billion tonnes of iron
ore deposits and is expected to begin by 2015.
India is among the world's largest steel producers.