Business World

What will happen to India’s investments under Taliban’s Afghanistan?

Countries around the world are confused if they should accept or reject Taliban’s rule in Afghanistan.

Several nations have heavily invested in the war-torn country – across all sectors, industries and segments, and now worry about the outcome of those investments.

India has so far made it very clear that they will not recognize the Taliban as the represented government.

“Strongly affirms that the Islamic Emirate of Afghanistan is not recognized at the United Nations and declares that it does not and will not support the establishment of any government in Afghanistan imposed through military force or restoration of the Islamic Emirate of Afghanistan” a joint statement of several nations including India read.


After the invasion of foreign forces in Afghanistan, way back in 2001, India invested over $3 billion to rebuild civic infrastructure of the war-torn country. This investment covers 400 projects carried throughout the nation.

Most of these projects surround infrastructure building and developing, human resource growth and development, building and strengthening trade and commerce via air and land connectivity, community development, capacity building, humanitarian help and assistance.

Focusing specifically on infrastructure India has helped the war-torn nation in building highways, streets, educational institutions, libraries, dams and its parliament building.

The parliament building alone cost $90 million, then there were a few other notable projects such as the Salma Dam which cost about $275 million and the Stor Palace which India helped revamp. Zaranj-Delaram highway cost $150 million, this highway is however more of a strategic development project as it serves as an alternative route to enter Afghanistan via Iran’s Chabahar port since Pakistan denied India access over the land to engage in trade with Afghanistan.

Trade between both the countries went beyond $1.5 billion, this trade mostly includes vegetable products and dry fruits. Afghanistan’s exports to India are said to have risen to $500 million in 2020. Whereas exports from India to Afghanistan valued over $800 million.

With the Taliban taking over several regions and sealing borders, trade has been hampered.

“We and our counterparts in Afghanistan are worried. Taliban has taken control of the Torkham and Chaman borders. Afghanistan mostly sends us dry fruits, which are perishable. There are no arrangements for importing dry fruits via sea or air,” Anil Mehra, the president of the Federation of Karyana and Dry Fruit Association said.

India imports over 80% of its dry fruits from Afghanistan and since the growing presence of Taliban supply has taken a hit. This has led to a price hike in India due to surge in demand as festival seasons are around the corner, many vendors have reportedly lost business.

“We are keeping an eye on the developments in Afghanistan. Imports from there come through the transit route of Pakistan. At the moment, Taliban has stopped the movement of cargo to Pakistan, so imports have virtually stopped. If trade doesn’t resume, prices of the existing dry fruit stock will shoot up and traders will have to also look for alternative sources of supply,” said Ajay Sahai, Director General of the Federation of Indian Export Organization.

The relationship and ties between these two nations in the near future isn’t clear and it lies in the grey area, neither black or white.

“At the moment, we are, like everybody else, very carefully following developments in Afghanistan. Our focus is on ensuring security in Afghanistan and the safe return of Indian nationals,” S Jaishankar, India’s External Affairs Minister said on Taliban takeover.