The Future of Afghanistan’s Rare-Earth-Elements Industry

September 29, 2021 Sneha Sebastian

The rare earth elements (REE) are a group of seventeen metallic elements. The term “rare” refers to their even, but scarce, distribution around the world. Rare-earth elements (REE) are necessary components of more than 200 products across a wide range of applications, especially high-tech consumer products. They are predominantly used in cellular telephones, computer hard drives, electric and hybrid vehicles, flat-screen monitors, and televisions.

REE is likely to remain important well into the future. They are essential to reduce greenhouse-gas emissions to avoid the most devastating consequences of climate change and global warming. The increased use of renewable energy like wind energy is likely to increase demands for neodymium and dysprosium (used in wind turbines). The transformation of demand from fuel-powered vehicles to electric vehicles is also going to increase the need for rare earth magnets and batteries. As a result, worldwide demand is projected to reach 315,000 tonnes by 2030.

Currently, China has the largest reserve of REE of approximately 44 million megatons. Russia has the 4th largest reserve of REE of approximately 12 million megatons. Both these countries have been focused on expanding their reserves.

Afghanistan has been endowed with a vast amount of REE. Its REE reserve is estimated to be around 1 trillion dollars. However, ever since the exit of the United States from the country, Afghanistan does not have a feasible method to tap these resources. Mining for Rare Earth Elements is a tedious and expensive process. The process has massive drawbacks like environmental damage, extreme pollution, and threat to human safety. Presently, Afghanistan does not have the resources to carry out such an expensive mining process to develop its Rare Earth Elements industry.

For Afghanistan, these resources promise a source of long-term foreign investment, human resource and infrastructure development. But a major question is which countries/companies would be involved.

Looking into the history of Afghanistan, you would realize that the country was called the “Graveyard of Empires”. Being surrounded by Iran in the west, China in the east, and Russia in the north; Afghanistan saw 3 major Anglo-Afghan wars in the 19th and 20th century. Russia’s interest to control Afghanistan was seen from its invasion in 1979.

Afghanistan holds immense economic and strategic importance to China. China’s continued interest to control Afghanistan is due to three reasons:

1) The Chinese government is worried about extremism influencing the western region of Xinjiang, where the government has detained hundreds of thousands of Uyghurs and other broadly Muslim minorities (it’s ironic how China is willing to establish good relations with predominantly Muslim countries when they exploit the Muslim minority within their own country).

2) China wishes to tap into Afghanistan’s $1 Trillion worth of mineral reserves. A senior colonel in the People’s Liberation Army said, “With the U.S. withdrawal, Beijing can offer what Kabul needs most: political impartiality and economic investment.” He also said, “Afghanistan, in turn, has what China most prizes: opportunities in infrastructure and industry building — areas in which China’s capabilities are arguably unmatched — and access to $1 trillion in untapped mineral deposits.”

3)The rare earth materials are also used in the production of military equipment like radar, satellite components, and missile guidance systems. China has made it abundantly clear in recent years that it wishes to expand its military capacity. Tapping into these resources will give the Chinese military a technological edge over other militaries.

To solidify his claims, presently, China has offered 200-million-yuan ($31m) worth of aid to Afghanistan, including food supplies and 3 million coronavirus vaccine doses. Beijing has also promised to maintain communications with the Taliban in Afghanistan. It also mentioned that the establishment of a new interim government was a "necessary step to restore order" in Afghanistan.

If China successfully completes its $900 billion Belt and Road Initiative and tap into Afghanistan’s $1 trillion mineral reserves, then, with time, this will allow China to transform nations across the Eurasian landmass and the Indian Ocean into long-term debtors. This will result in something called the “debt-trap diplomacy”, where nations end up piling enormous debts to China. This in turn will give China an opportunity to impose economic and political sanctions on these countries and question their sovereignty.

China has been trying to establish its claims over Afghanistan’s resources for quite some time now. In 2017, two Chinese state-owned Metallurgical Companies won a nearly $3 billion bid to develop the country’s largest copper mine near Kabul. However, they couldn’t start production due to several political and infrastructural problems.

As previously mentioned, today, Afghanistan is at the centre of geopolitical struggles, involving India, Pakistan, China, Iran, and the U.S. The fact that the Taliban are now in control complicates the situation even more. Any country that wishes to tap Afghanistan’s natural resources must ensure good communications with the Taliban. But any country that does this would be perceived as supporters of terrorist activities. This country can also fall prey to the Taliban’s unreasonable demands which may, in the future, affect Global security.


-American Geoscience Institute. What are rare earth elements and why are they important?

-Science History Institute. 2020. The History and Future of Rare Earth Elements.

-Cristina Pozo-Gonzalo. April 16, 2021. Demand for rare-earth metals is skyrocketing, so we’re creating a safer, cleaner way to recover them from old phones and laptops.

-Scott M Montgomery. September 1, 2021. Afghanistan has vast mineral wealth but faces steep challenges to tap it.

-Richard Mills. September 18,2021. Russia And China Are Looking To Tap Afghanistan’s $1 Trillion Resource Reserves.

-BBC News. 9 Setember,2021. China offers $31m in emergency aid to Afghanistan has pledged 200 million,communication with the Taliban government

About the Author:

Sneha Cathy Sebastian is a 2nd year student of Economics in Stella Maris College, Chennai.


The article reflects the opinion of the author and not necessarily the views of the Organisation.

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