Indian consortium wins $10bn Afghanistan mines deal

File photo of Afghan coal miner (June 2010) Afghanistan has vast mineral deposits which on paper are worth trillions of dollars

A consortium of Indian companies has won the right to develop some of Afghanistan's large iron ore deposits, Afghan mining ministry officials say.

Seven Indian companies, led by the state-owned Steel Authority of India, won a $10.3bn (£6.6bn) deal to mine three sites in central Afghanistan.

A fourth site was awarded to Canada's Kilo Goldmines. All the contracts are due to be signed early next year.

Last month, Afghanistan signed a strategic partnership deal with India.

In a development that correspondents say caused some concern to India's strategic rival Pakistan, the two sides said the aim was to boost trade, security and cultural links.

Exploitation of the estimated two billion tonnes of iron ore deposits in Hajigak mine - located in Bamiyan - is expected to begin by 2015.

Officials say that the project has the potential to be Afghanistan's single biggest foreign investment project.

The Hajigak deposit contains an estimated 1.8 billion tonnes of iron ore, with an iron concentration of 64%, the mines ministry said in a statement. The figures are based on a survey carried out in the 1960s.

ESTIMATED DEPOSITS

  • Iron: $421bn
  • Copper: $274bn
  • Niobium: $81bn
  • Cobalt: $51bn
  • Gold: $25bn

The ministry said last year that Afghanistan could be self-sufficient within a decade if its mineral resources - which some estimates have valued as high as $3tn - are properly exploited.

But correspondents say that questions are certain to be asked as to whether investors will want to advance the large sums of cash required to start building mine and rail infrastructure in the country, which at the moment is almost non-existent.

Their unease is almost certain to be enhanced given the renewed uncertainty in Afghanistan ahead of the planned withdrawal of most Nato troops from the country by late 2014.

The mines ministry says that Afghanistan has vast reserves of oil, gas, copper, gold and lithium.

More on This Story

The BBC is not responsible for the content of external Internet sites

More Asia stories

RSS

Features & Analysis

  • SyedTanks instead of toys

    Lyse Doucet on the plight of children in Syria and Gaza


  • Silhouette of manSuper-shy

    Why do Germany's super-rich so often keep their heads down?


  • Children playing in Seoul fountainDay in pictures

    The best news photos from around the world in the past 24 hours


  • Gin drinkerMother's ruin

    The time was gin was full of sulphuric acid and turpentine


Elsewhere on the BBC

  • EscaladeBling's the thing

    The ostentatious Cadillac Escalade cruises into 2015 with fuel-gulping gusto

Programmes

  • The smartphones of shoppers being tracked in a storeClick Watch

    How free wi-fi can enable businesses to track our movements and learn more about us

BBC © 2014 The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.