A Helping Hand To Kabul

Context: In light of the political and humanitarian tragedy in Afghanistan, India’s years of investments in infrastructure and grassroots development could act as a building block for cementing relations with the new regime in the coming years.

India’s investment in Afghanistan

• Significant Development Assistance: 
  • India is currently the fifth-largest donor in Afghanistan. The latter is also among the top five recipients of India’s external assistance. India’s total development assistance over the years has been worth over $3 billion. 
• Soft measures: Has helped build goodwill and greater people-to-people contact and has involved measures focusing on health, education, capacity development and food security, among others. 
  • Many projects have been community-driven, thus helping engage a large section of people.
  • Engaged in triangular cooperation with USAID on various programmes like the Afghan Women’s Empowerment Programme, a collaboration between USAID and the Self-Employed Women’s Association (SEWA) for providing vocational education for Afghan women.
• Hard infrastructure: Building institutions, roads and infrastructure for power transmission has featured prominently. 
  • Examples include the parliament building, which was inaugurated in 2015, financing the Delaram-Zaranj Highway as well as the 42 MW Salma Dam in Herat province.
  • At the Afghanistan Conference in Geneva in 2020, India announced several fresh development commitments, including the construction of the Shahtoot Dam in Kabul.

How is India’s development assistance different from others?

• India follows a demand-driven approach, which implies that the sectors for investment are chosen by the recipient government.
• Although India’s aid is extended as a soft means to gain strategic leverage, it comes without political trappings.
• The latter can be seen in aid extended by Germany and the US, which have often been contingent on the progress in talks between the Taliban and the civilian government.
• Valuable and economical: When compared in PPP terms, the value of the Indian rupee is often under-estimated, meaning that the Indian rupee would be able to buy more goods and services at adjusted exchange rates.
• For example, a study by the Stimson Centre found out that even though Indian aid in 2015-16 totalled $1.36 billion, in PPP terms, it could be pegged at over $5 billion.

Way Forward: Continues engagement with Afghanistan is essential – 

• Resisting China: China is likely to be the biggest gainer. It could look to build the Wakhan corridor in order to gain better connectivity with Afghanistan as a part of its larger BRI endeavour.
• Infrastructure deficit in Afghanistan: There is a need for reconstruction and rebuilding. Indian can diversify its developmental assistance - 
  • Strengthening terms of trade between India and Afghanistan, considering the latter’s trade deficit. 
  • Build a more resilient Afghanistan with respect to climate change and disaster risk reduction with it spearheading global campaigns like CDRI. 

Conclusion: India needs to establish itself as a neutral entity that is keen on the development of the region but ready to work with all parties concerned.