Afghanistan and scramble for its mineral resources
Afghanistan has been a battleground for political powers for a long time and a lot has been spoken about it. But one of the reasons why Afghanistan was turned into a battleground is because of the resources which it has. With the US withdrawing its troops and Taliban taking power, Afghanistan's vast mineral power faces challenges, out of which the major ones are - who will control the resources and who will be involved in maintaining and doing business with it.
The official ending of the U.S led war in Afghanistan and Taliban regaining power through force, one of the questions which the international community and scholars are debating about is - how will the country develop a stable economy? With U.S troops leaving the country and the international aid falling short due the extremist group regaining power, one of the options which Afghanistan has is exploit its natural resources and trade in it. Afghanistan is rich in minerals like copper, gold, oil, natural gas, uranium, bauxite, coal, iron ore, lithium, chromium, lead, gemstones, zinc, sulphur, talc, gypsum, marble and travertine. Disposal of such resources in Afghanistan amounts to around US $1 trillion. The country has a rich history in trading of the resources, especially in gemstones like rubies, emeralds, tourmalines and lapis lazuli. But the real value in the present lies in the resources which can generate energy and Afghanistan has such resources in abundance.
According to the United States Geological Survey, some of the metals of special interest are - copper, lithium, iron and rare earth metals. The total copper resources are valued at $516 billion. The largest copper deposit which also contains significant amounts of cobalt in the Aynak ore body, located 18 miles southeast of Kabul. It is estimated that the Aynak deposit is around 11.3 million metric tons of copper which is worth $102 billion currently. If Afghanistan is to trade in copper today, it would fall in the top 5 countries in the world for highest copper reserves. Haji Gak deposit of Bamiyan Province is known for its world-class iron ores. With an estimated disposal of 2,100 million metric tons of high-grade iron-ore, it is currently valued at $336.8 billion, making Afghanistan one of top 10 nations worldwide in extractable iron. Lithium is found in Nuristan Province while rare earth metals exist in the south of Helmand Province. rare earth metals total to be around 1.4 million metric tons and are prices more than $45,000 metric ton.
There is no doubt that Afghanistan has vast mineral resources. But it is important to note that these resources are undiscovered resources - identified but not fully assessed and explored. If exploited, the resources can enable Afghanistan to become an economically stable country which no longer will be dependent on foreign aid and donor countries. However, there are myriad of problems which present Afghanistan from exploiting its resources to be a mineral rich country with a stable economy. Internal factors like lack of security and stable authority, lack of institutions and absence of measures to monitor the resources and its mapping are some of the biggest hurdles due to the constant change in the governance of the country. With the climate change crises getting worse, Afghanistan will be severely impacted if mining and extraction activities are carried out, thus resulting in deterioration of the land, air and water quality. Afghanistan also lacks connectivity, especially roadways and railways - as they are important for transportation to the foreign markets and factories.
A stable government can ensure that these challenges are dealt with in a comprehensive manner through robust policy making and by creating bodies and institutions which will drive the change. But in a country where one military conflict after another takes place, the expectation that stability will arrive seems like a farfetched reality. But one cannot ignore the opportunity and the fact that the resources can actually put Afghanistan on the tract to achieve its past glory.
One of the tenants of better management of these resources is mining. Mining is an exploitative business and when taken up by an extremist power hungry group, it can turn into a nightmare. It can also lead to the risk of another conflict to control the resources to mint money. Afghanistan's mining sector is now facing a threat from the Taliban in terms of ambiguity about how the future will pan out. Illegal mining is a rampant activity across Afghanistan and Taliban, along with other warlords and insurgent groups, engaged in out actively to raise money. Even when the Afghan government was in power, it did not control the mining sector as most of it was under the control of the insurgent groups.
Moving forward, the Taliban faces a challenge – while it has been in the mining sector for a long time, it did not control all the areas. The Taliban will have to come up with ways to control all the mining areas in the country if it has started the mining of resources in order to trade with the countries in order to run its economy. More so, creation of an efficient system in one of the failed states of the world by the organization itself who led the country to where it is today, seems like a herculean task. Therefore, for the coming future, the Afghan economy will continue to depend on the foreign aid despite the Western countries cutting the development aid in an attempt to cut off the strength of the Taliban regime. Security issues are rampant along with the corruption and the situation is not likely to improve overnight when it comes to infrastructure and legal bureaucracies in Afghanistan. While all major countries in the world are interested in the resources, with the Taliban regime in control - most of them are not willing to invest in the resource sector despite the Taliban inviting foreign companies to invest and mine the resources, due to the potential risk of international sanctions as well as security concerns. While some Indian and Chinese companies have been engaged in the mining of resources in Bamyan Province and Aynak Copper Mine respectively, foreign companies face many risks, which has affected their enthusiasm.
Due to financial instability, the Taliban regime needs money but mining and exploitation of the resources in a long-term process. If the Taliban regime decides to go ahead with mining activities, it can lead to a long-term investment in the sector which will improve the situation of the country considerably, only if done in a sustainable manner. The Taliban regime does not know how to sustainably lead the mining process and hence will need aid from the countries and the private sector. The Western governments and companies, who possess the know-how of sustainable mining, are reluctant to bid on the projects due to security and law concerns. If they go ahead and bid, then they will be criticized for ignoring the Islamist groups overthrow of the democratic regime of the government and the human right abuses. But if they do not do so, they will see China becoming closer to the Taliban government and slowly taking control of the resources in Afghanistan. Another element of this vicious cycle is to know which government and companies will invest in mineral and resource extraction in Afghanistan. India, Pakistan, China, Iran, Russia and the U.S have been important players in the geo-political battle in Afghanistan. Even with the Taliban in power, the resources do not become less valuable. Instead, according to the data released by the Afghan government last year, the resources in Afghanistan amount to US $ 3 trillion as compared to US $1 trillion (according to USGS). It will be interesting to see how geopolitical dynamics change and how the Taliban government decides to go ahead with its mineral sector exploitation, because resources are the only opportunity which can help turn the graveyards of the empire into an actual empire.
Pic Courtesy-Sohaib Ghyasi at unsplash.com
(The views expressed are those of the author and do not represent views of CESCUBE.)
