- Development & Aid
- Economy & Trade
- Human Rights
- Global Governance
- Civil Society
Monday, March 30, 2015
- Last month the first cargo train crossed the ‘Friendship Bridge’ from Uzbekistan to the border town Hairatan in northern Afghanistan, and rolled along 75 kilometres of newly laid track to Mazar-e-Sharif.
The importance of the northern trade route – which connects Central Asia’s Northern Distribution Network (NDN) to Afghanistan – has increased since the U.S. and Pakistan’s relationship drastically soured.
Since the bombing of Pakistani troops by coalition forces in December, Afghanistan’s two major border crossings with Pakistan at Torkham and Spin Boldak have been closed to military trucks of the North Atlantic Treaty Organisation (NATO) and the International Security Assistance Force (ISAF).
The focus now is on the border crossing at Hairatan, which currently receives 70 percent of Afghanistan’s fuel imports, and 60 percent of the coalition forces’ non-lethal goods.
The small stretch of railroad – built by the Asian Development Bank (ADB) and run by the Uzbek government until Afghanistan creates a rail authority – marks the first phase of an ambitious national rail system to shadow the country’s ring road, linking Afghanistan to its Central Asia neighbours and beyond.
Afghanistan’s rich resources – which include iron ore, copper, gold, cobalt, lithium, oil and gas – were identified for exploitation by the Soviet Union decades ago, and further mapped out by the United States Geological Survey (USGS) in conjunction with President Hamid Karzai’s government. The U.S. estimates Afghanistan’s untapped mineral wealth at 1 trillion dollars.
Among the major concession bids that Afghanistan’s Ministry of Mines has so far awarded is a 30-year lease for the Mes Aynak copper mine in Logar province – with an estimated mineral deposit worth up to 88 billion dollars – to the state-owned China Metallurgical Group for 3 billion dollars.
An Indian mining consortium with state ties and Canada’s Kilo Goldmine Ltd. won the gigantic 1.8 billion metric ton Hajigak iron ore mine in Bamiyan. And a 700 million dollar oil and gas deal has just been inked with the China National Petroleum Corporation in the country’s northern Sari Pul and Faryab provinces.
Local watchdog Integrity Watch Afghanistan (IWA) says over 100 small, medium and large mine agreements have been signed by public and private companies so far.
“Right now up for bid is gold and copper,” Abdul Jalil Jumriany, director of policy and promotion at Afghanistan’s Ministry of Mines tells IPS. “The gold deposit is in Badakhshan, and then we have another gold and copper deposit that USGS says could be the best in the world, in Ghazni.”
However, the country’s rugged terrain, widespread insurgency and decades-long insecurity pose a formidable challenge to the successful extraction and export of this precious and heavy cargo.
In consultation with the Ministry of Mines, the second phase of the ADB railroad project would construct an estimated 500 million dollar railroad following Afghanistan’s northern border with Turkmenistan, from Mazar-e-Sharif to Herat near the Iranian border, passing oil and gas fields. A feasibility study for the railroad will be conducted this year, and funds are being raised for the project.
“We are very aware of the high risk involved in building a railroad and keeping it running, and security is one of our biggest concerns,” says Juan Miranda, director of ADB’s Central and West Asia Department, in an interview with IPS. He names Japan as the rail’s largest donor, followed by various European countries, the U.S. and New Zealand.
Besides ADB’s ambitious agenda, the Indian consortium at Hajigak has just announced plans to build a separate rail link through the centre of the country to the Iranian coast. And a high-profile side deal in the Aynak Chinese concession agreement – still unpublished since it was signed in 2008 – promises to construct a railroad line from the mine, just south of Kabul, to the northern border “if feasible”.
“This Mazar line will go to Bamiyan, where there is a huge iron ore deposit, and then through Kabul, where it connects to the copper mine at Aynak, and then connects to Torkham on the Pakistani border,” explains Jumriany.
However, the China Metallurgical Group has not started studying the construction project yet. “If they build it, they will. If they don’t, we will,” says Miranda, who estimates Afghanistan’s entire rail network to be up and running within the decade, at a cost of roughly 1 billion dollars.
Thomas Ruttig from the Afghanistan Analyst’s Network (AAN) has his doubts. “I think that railroads in particular are very vulnerable in a situation of war which does not look as if it is going to end soon,” he says. “This is not to speak about the terrain which would make building a rail from central Afghanistan (Hajigak and Aynak) something like an engineering miracle.”
Javed Noorani, a researcher for IWA, flags crucial issues like those associated with the Aynak copper mine. There are divisive land disputes between community members who were promised compensation from the government to move, a grave threat of water depletion from mining activities, as well as a vulnerable archeological site in the copper mine’s midst.
“Social fragmentation is already happening. The huge mass of land is already dividing people,” says Noorani, who believes the Ministry of Mines tries to prevent his trips to inspect the community. “There is discord between people. They start suspecting each other.”
“In Afghanistan, international companies need Afghan partners,” says Ruttig. “Many mines already operate at a very low level technically, and are often owned or run by people who are either warlords or commanders or linked to them. This also does not bode well for social and economic sustainability.”
Also questioned is Afghanistan’s geo-political role in the region once the coalition forces withdraw. The former Soviet Union states, Iran and Pakistan already export goods on a massive scale into Afghanistan, and a predominance of Chinese and Indian companies are now reaping the largest Afghan concessions, with a scarcity of European companies, and none from the US, securing bids.
Jumriany from the Ministry of Mines disagrees. “We have a very good team from the U.S. Department of Defence called the Task Force for Business Stability Operation that is helping us promote these tenders,” he says. “We have a multi-cultural investment coming together. That’s why we are going to London and Canada next, to promote these investments.”