India has unveiled its vision of promoting economic rejuvenation and stability of Afghanistan by asking companies from the region to invest in that country in the spirit of solidarity, despite the risks, and called for CEOs to replace generals to lead the country’s reconstruction.
“We need to offer a narrative of opportunity to counter the anxiety of withdrawal, uncertainty, instability and foreign interference,” External Affairs Minister S.M. Krishna told the first regional conclave organised in India to encourage private sector investment in Afghanistan.
“India will continue to pursue its vision to stabilize Afghanistan through trade and investment and regional cooperation,” he said while jointly inaugurating the conclave with his Afghan counterpart Zalmai Rassoul.
“We invite international investors and regional countries to join in this vision for Afghanistan individually or in partnership with others,” he said.
Afghanistan robustly backed this approach. “I believe greater investments results in increased economic national activities in any country including, but not limited to, additional revenues, job creation, income generation opportunities which in turn leads to increased prosperity and service delivery,” said Rassoul.
Over 80 Afghan companies, 130 Indian companies and 70 international companies from 33 countries, including Pakistan, China, Iran and the Gulf countries, participated in the summit. The Afghan delegation included five senior ministers, including Rassoul, Commerce and Industry Minister Anwar-ul-Haq Ahady, Finance Minister Hazrat Omar Zakhilwal, Minister of Mines Wahidullah Shahrani and Agriculture Minister Mohd. Asef Rahimi.
The recommendations of the day-long investment conclave will be submitted as a framework at the Tokyo Conference July 8 where international donors will pledge funds for Afghanistan after international troops leave the violence-torn country in 2014.
The key recommendations of the summit included providing the private sector investment protection and risk mitigation, providing incentives for investing in Afghanistan, and the creation of an international fund for SMEs.
The conclave identified key sectors for investment in Afghanistan that included natural resources, manufacturing, infrastructure, agriculture, IT and telecommunications.
Acknowledging the security concerns of businesses about risks of investment in Afghanistan in the run-up to the phased withdrawal of international troops by 2014, Krishna exhorted the companies from the region to act in solidarity, saying if companies invest together and in numbers, they will all benefit from the collective security of venturing together.
“Investments can provide that hope for employment, training and opportunity for the future. We encourage our industries to venture into Afghanistan in numbers together with Afghan partners,” he said.
“We feel that foreign investment and domestic private sector development, both small and large scale, can play that role. Let the grey suits of company executives take the place of olive green or desert brown fatigues of soldiers; and chief executive officers, the place of (military) generals,” he said.
“They can also play a larger stabilizing role,” he added.
Noting that the military withdrawal should not result in a political or security vacuum that will be filled by extremists once again, the Indian minister said there should be “something productive” in its place.
“This vision requires international support in the form of institutional finance and foreign investment,” he said, recognising the presence of representatives from the World Bank, Asian Development Bank and other international financial institutions at the day-long event.
Dispelling security fears, senior ministers from Afghanistan assured Indian investors a business-friendly environment and said there are 17 key sectors, including mines, cement, steel and agriculture, in which they can invest and reap good returns.
“Please don’t write off Afghanistan. We are willing to pay personal attention to facilitate your investment in our country,” Commerce and Industry Minister Anwar-ul-Haq Ahady here.
“We allow 100 percent foreign ownership of enterprises, easy repatriation of profits, treat foreign investors identical to domestic ones, and we allow accelerated depreciation,” said Ahady.
Commerce and Industry Minister Anand Sharma described Afghanistan as a country close to India’s heart and said Indian companies will be offering cutting-edge technologies and expertise for the reconstruction of Afghanistan.
He also announced that he would soon lead an Indian business delegation to Afghanistan, in a bid to enhance economic engagements between the two countries.
“The visit will happen soon. Officials of the two countries will work out the dates,” Sharma told reporters on the sidelines of the Delhi Investment Summit on Afghanistan here