Afghanistan's Taliban signs mining contracts worth $6.5B

Afghanistan’s ruling Taliban government said it has signed seven mining contracts amounting to $6.5 billion in investment, in the biggest such round of deals since seizing power two years ago.

The seven contracts signed on Thursday are with locally based companies, many of whom have foreign partners in countries including China and Iran. They include the extraction and processing of iron ore, lead, zinc and gold in four provinces: Herat, Ghor, Logar and Takhar.

A statement on the contracts from Deputy Prime Minister for Economic Affairs Abdul Ghani Baradar gave few details but said they would create thousands of jobs and significantly improve the economic situation of the country.

Any figures given for the deals could be misleading unless they lead to fully realised mining operations on the ground, which could take years, said Javed Noorani, an expert in Afghanistan's mining sector.

"The Taliban know Afghanistan has minerals and this is cash, but it’s not easy cash,” Noorani told The Associated Press.

"Mineral mining is an incredibly complicated operation. It requires a proper framework, strategies, institutions and infrastructure. You open up the sector slowly and start with low-hanging fruit," he added.

The Taliban have been courting foreign investment to revitalise the economy since their takeover.

Nearly 80 percent of the previous, Western-backed Afghan government’s budget came from the international community. That money, now largely cut off, financed hospitals, schools, factories and government ministries.

The Taliban, like previous administrations in Afghanistan, are pinning their hopes on the country's vast and untapped mineral resources to line the nation’s coffers. Logar province is believed to hold the world’s largest copper deposit.