How India & Afghanistan can grow together

India remains an integral part of Afghanistan’s steady progress in institutionalizing peace, pluralism, and prosperity. Ties between Afghanistan and India go beyond the traditionally strong relations at the government level. Since time immemorial, the peoples of Afghanistan and India have interacted with each other through trade and commerce, peacefully coexisting on the basis of their shared cultural values and commonalities.

This history has become the foundation of deep mutual trust. Public opinion polls in Afghanistan confirm this, as well as the sentiment Afghans share about feeling at home whenever they visit India.

Growing Asia

Fastest growing continent in the world with 60% of world’s
population (4.2 billion)
Two-third of global growth would come from Asia in next few
years
In 1990, the top five economies were not among Asia. Today,
Japan, China and India are top 3 economies in the world
Asia’s share is expected to touch 50% of world’s GDP by 2050

Why Afghanistan

A population of 34 million and increasing
Five year compound annual growth (CAGR) is 5.4%
GNI per capita is US$630
FDI has increased from US$ 230k in 1970 to US$ 169mn in 2015
Exports and imports taken together equals 53% of GDP
Infusion of billions of dollars in international assistance and investments as well as
remittances from Afghan expats
World Bank expects to provide US$250-300 mn in grants annually to Afghanistan
through the World Bank Group
One of the mineral-rich countries of the world
(the country holds US$ 3 trillion in untapped mineral deposits without Uranium )
Low tax rates in Afghanistan
(Corporate tax rates are 20% with an overall tax burden of 6.5% only of total domestic income)
Improved agricultural production
Formation of democratic government & improved regulatory environment

India- Afghanistan relations

Bilateral relations between the two countries have always been strong and
friendly
India’s financial assistance to Afghanistan was 880 crore in 2015-16
In 2016, India has also extended an aid of over UD$2 billion to Afghanistan
for one of India’s most expensive projects in Afghanistan (Salma dam)
India-Afghanistan bilateral trade stood at US$643 million in 2015-16
Afghanistan sets a target of US$10 billion for bilateral trade and
investment with India in five years
In February 2017, Indian visa regime has been further liberalised to make
it even more convenient for Afghan nationals to visit India

Our support to Afghanistan

Needs in Afghanistan
- Skilled manpower
- Professional services for businesses
Strengths to work with India
- Convenience of working in the same time zone
- Connectivity time is less than two hours
- Similar cultural backgrounds

Why India can be a strong partner to Afghanistan

World’s third largest economy (Would double in size to US$ 4–5 trillion in a decade)
Fastest growing economy in the world (Current: 7% , by 2018: 7.8%)
By 2020, retail market is expected to grow to US$ 1.1 trillion (growing at a high rate of 20%-25% p.a.)
IT-business process management (BPM) sector in India is estimated to expand at a CAGR of 9.5% to US$ 300 billion by 2020
Indian construction equipment industry’s revenues are estimated to reach US$ 22.7 billion by 2020
Total FDI equity inflows touched US$ 35.84 billion (till December 2016)
Under FDI, all sectors other than sectors which are specifically prohibited or under approval route
Taxes on companies has been reduced to 25% (For companies with annual turnover less than 50 Crores)
Low labor costs (Total labor force of nearly 530 million)
Working age group will be more than 64% by 2021 (15-59 years)
Skill set of India has improved over the years with 40% employable candidates. We have 1.5mn engineering pass outs in India every year