India's Strategic Mining Pursuit in Afghanistan: Tapping into Hidden Treasures

Deccan Gold Mines Ltd seeks to partner in Afghanistan to exploit its rich mineral resources, including lithium and gold. Despite challenges such as banking and regulatory hurdles, India sees a strategic need to engage early. Domestic plans aim to boost rare earth mineral production as China controls most of the supply.

Deccan Gold Mines Ltd is engaging in talks with potential partners in Afghanistan to capitalize on the country's abundant mineral resources, including lithium, rare earth minerals, and gold, according to Managing Director Hanuma Prasad in an interview with ANI.

Potential collaborations have been underway for a year, with several entrepreneurs and authorities in Afghanistan showing interest in business partnerships. Afghanistan possesses some of the world's most significant identified deposits of lithium, rare earth elements, and gold, extensively documented during Soviet-era explorations. Prasad emphasized the critical importance of these minerals to India's strategic interests.

During a meeting in November, an Afghan delegation proposed to the Indian industry body ASSOCHAM to explore its mining sites, aiming to enhance economic cooperation and local employment. However, progress faces obstacles due to a lack of banking channels and unclear regulatory procedures. Despite strong diplomatic ties, challenges related to governance and human rights persist, although the mineral potential remains compelling.

India, historically reliant on rare earth mineral imports from China, faces export restrictions and is seeking to boost domestic production. Current local output ranges between 2,000 and 2,900 tonnes annually, insufficient for demand expected to double by 2030. A government scheme with Rs 7280 crore funding aims to increase capacity significantly by decade's end, in efforts toward self-sufficiency.

The Union Cabinet has sanctioned a plan to establish 6,000 Metric Tons per Annum (MTPA) of integrated Rare Earth Permanent Magnet (REPM) production in India. This initiative signals a strategic pivot, reducing dependency on China, which dominates 90% of global supply. Prasad emphasized the importance of producing these critical components domestically, noting China's market dominance.

Additionally, Deccan Gold's private gold mining operations in Andhra Pradesh have commenced, with further trial production underway in Kyrgyzstan. Nickel-copper-platinum drilling in Chhattisgarh will start in December, while rare earth projects in the Northeast and Gujarat remain long-term pursuits due to development and regulatory complexities.

(With inputs from agencies.)