The Hindu Business Line : India grants additional $50-m aid to Afghanistan

The President of Afghanistan, Mr Hamid Karzai, and the Prime Minister, Dr Manmohan Singh, at the Hyderabad House in the Capital Monday. — Kamal Narang

New Delhi , April 10

India has sanctioned an additional assistance of $50 million to Afghanistan on Monday.

With this, the total assistance to the country goes up to $650 million. The Prime Minister, Dr Manmohan Singh and the visiting Afghan President, Mr Hamid Karzai, also signed three MoUs in the field of education and rural development.

At a meeting organised by industry chambers later in the day, Mr Karzai invited Indian industry to take advantage of the one-window approval for business projects to set up manufacturing facilities in the country in areas such as cement, oil and gas, electricity and services industries such as hotels, banking and communications.

While speaking of the pro-investment climate in his country, Mr Karzai said, "Afghanistan has adopted a free market philosophy and has enacted laws that facilitate business activity, while at the same time fully protecting them."

The country was the gateway to Central Asia and Indian industry should take advantage of the low tax regime to make Afghanistan a manufacturing hub, he added.

Mr Karzai said Afghanistan was experiencing double-digit rates of economic growth for the last four years. He also highlighted that World Bank had rated Afghanistan as one of the best countries to do business with, a country where investment was fully protected. "We are aware that we will prosper only if we go by the rules of free trade and good business practice," he said.

Mr Saroj Kumar Poddar, President, Federation of Indian Chamber of Commerce and Industry, pointed out that Afghanistan could become the transit route for oil and gas pipelines from Central Asia to India and such a pipeline would have potential for improving living standards in South and Central Asia.

Mr Subodh Bhargava, Past President Confederation of Indian Industry, said development of soft infrastructure such as healthcare, education, banking, insurance, distance learning and e-education could be explored by Afghanistan in which India has vast expertise.

Mr Rakesh Bakshi, Senior Managing Committee Member, Assocham emphasised the need for close cooperation between Indian and Afghan business in infrastructure building and the energy sector, particularly renewable energy.