China may offer Taliban tariff-free trade to get closer to its resources

Selling Afghanistan's lithium, copper and iron deposits to the world's biggest commodities buyer would help Taliban prop up their ailing economy, which United Nations says has 'basically collapsed'

China will offer the Taliban tariff-free access to its vast construction, energy and consumer sectors, Beijing's envoy to Afghanistan said on Thursday, as the ailing resource-rich but diplomatically-isolated regime looks to build up its markets. 

Beijing has sought to develop its ties with the Taliban since they took control of Afghanistan in 2021, but like all governments has refrained from formally recognising the Islamic fundamentalist group's government amid international concern over its human rights record and those of women and girls. 

But the impoverished country could offer a wealth of coveted mineral resources to boost Beijing's supply chain security. 

And selling Afghanistan's lithium, copper and iron deposits to the world's biggest commodities buyer would help the Taliban prop up their ailing economy, which the United Nations says has "basically collapsed", and provide a much needed revenue stream as the country's overseas central bank reserves remain frozen. 

"China will offer Afghanistan zero-tariff treatment for 100 per cent tariff lines," Zhao Xing, Chinese ambassador to Afghanistan, wrote on his official X account late on Thursday, above a photo of him meeting acting deputy prime minister Abdul Kabir. 

Afghanistan exported $64 million worth of goods to China last year, according to Chinese customs data, close to 90 per cent of which was shelled pine nuts, but the Taliban government has said it is determined to find foreign investors willing to help it diversify its economy and profit from its minerals wealth. 

The country exported no commodities to China last year, the data shows, but Zhao has regularly posted photos of him meeting Taliban officials responsible for mining, petroleum, trade and regional connectivity since his appointment last September. 

Several Chinese companies operate in Afghanistan, including the Metallurgical Corp of China Ltd, which has held talks with the Taliban administration over plans for a potentially huge copper mine, and was highlighted in an August feature in Chinese state media on Chinese companies rebuilding Afghanistan. 

Chinese President Xi Jinping at a Beijing summit for more than 50 African leaders in September announced that from Dec 1 goods entering his country's $19 trillion economy from "the least developed countries that have diplomatic relations with China" would not be subject to import duties, without giving details. 

The policy was then repeated on Wednesday by vice commerce minister Tang Wenhong at a press conference in Beijing on the preparations for upcoming China's annual flagship import expo. 

The Afghanistan embassy in Beijing did not respond to a request for comment. 

Last October, Afghanistan's acting commerce minister told Reuters the Taliban wanted to formally join Xi's flagship "Belt and Road" infrastructure initiative. 

Kabul has also asked China to allow it to be a part of the China-Pakistan Economic Corridor, a $62 billion connectivity project connecting China's resource-rich Xinjiang region to Pakistan's Arabian Sea port of Gwadar.    China seeks to boost food output with five-year smart farming plan  

China on Friday launched a five-year action plan to accelerate the digital transformation of the entire agriculture industry chain as part of measures to raise domestic food production. 

The 2024-2028 smart agriculture action plan will aim to establish a digital planting technology scheme as well as a national agricultural and rural big data platform by 2028, the agriculture ministry said in a statement. 

The urgency to adopt big data, GPS navigation systems and artificial intelligence in farming comes as the world's largest grains producer stepped up investments in farm machinery and seed technology in its quest for food security. 

China's grain output is set to exceed a record 700 million metric tons this year, Zhang Xingwang, the vice minister for agriculture and rural affairs told reporters in a news conference on Friday. 

But he said efforts to ensure stable supply "cannot be relaxed" as the country remains highly reliant on imports to feed a population of 1.4 billion. 

China imports over 100 million metric tons of soybeans and grains a year, particularly from United States and Brazil.

The digital transformation, which covers farms, animal husbandry and fisheries, is expected to help reduce costs, increase production and increase efficiency. 

To accelerate yield increase, the ministry will accelerate the digital upgrade of agricultural machinery and equipment at farms.

The ministry added that it will continue to explore the future of smart agriculture by supporting research institutions and strengthening the research and development of agricultural technologies.

 

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)