Iran and Afghanistan will conclude a deal “soon” under which the Islamic Republic will import Afghan coal, minister of commerce and industries in the transitional Taliban government Nuruddin Azizi has said.
“Talks with the Iranian side for the export of coal have progressed and a contract will be signed in this regard soon,” Fars news agency quoted him as saying.
Azizi said the exports will help improve trade balance between the two countries which is in Iran’s favor.
Iran is Afghanistan’s largest trading partner, with around $2 billion in bilateral trade each year, nearly a third of Afghanistan’s total trade volume.
Afghanistan has an estimated 73 million tonnes of proven coal reserves with a capacity to produce 1.8 million tonnes a year.
The country hopes that untapped mineral deposits valued at $3 trillion could help bankroll its impoverished economy after years of US-led occupation.
Those resources include iron ore, copper, lithium, oil gas and gems, but the challenge of exploiting them in a country at war and with little mining infrastructure is daunting for most investors.
China acquired a 30-year lease on the Mes Aynak copper mine for around $3 billion in 2008 but the project has been plagued by delays due to contractual wrangling.
Back in March, Iranian Minister of Industry, Mine and Trade Reza Fatemi-Amin said he had held talks with the Taliban government to help exploit iron ore mines in Afghanistan.
“Afghanistan is rich in mineral reserves. A huge deposit of an Iranian iron ore mine named Sangan, which is situated in Khaf lies in Afghanistan. Thanks to its facilities and high-tech know-how, Iran can help exploit the iron ore in Afghanistan. This will be mutually beneficial. We are following up the negotiations with the Afghan party to gradually build processing capacities in Afghanistan. We can swap Iranian goods for the ore we exploit in Afghanistan,” Reza Fatemi-Amin noted.
A contract was signed with an Iranian company for the extraction of lead and zinc in Afghanistan’s Ghor province, the press office of the provincial governor said in September.
Iran sees Afghanistan’s development as a boon to its own. The constant principle for Iran has been development of its neighbor irrespective of who rules the country, because underdevelopment and insecurity in Afghanistan also affect Iran.
Even under US allies at the helm in Afghanistan, Iran’s development projects did not stop in the war-torn country. The Islamic Republic has spent millions of dollars on development and reconstruction projects in Afghanistan. It has built hundreds of kilometers of highways and railroads.
Tehran was one of the largest donors at a 2002 Tokyo conference, pledging more than India, Saudi Arabia, the United Arab Emirates, Turkey, Norway, Switzerland, Australia, and Pakistan combined.
The Islamic Republic also hosts many Afghans whose number in Iran is currently put north of 5 million.