China Recognition of Taliban Soon? Beijing to Sign Oil Exploration Contract With Afghanistan

The Taliban government in Afghanistan is signing a deal with a Chinese firm for conducting oil exploration in the northern region of the country. This marks the first time the Afghani Taliban administration is entering into a major deal with a foreign government since they captured power in 2021.

China said the oil exploration agreement is an important step in the bilateral relations between the two countries. As per the 25-year deal, Xinjiang Central Asia Petroleum and Gas Company (CAPEIC) will drill for oil in the Amu Darya basin in the northern region of Afghanistan.

China forms anti-terror alliance with Pakistan, Tajikistan, and Afghanistan
China's People's Liberation Army troops and Pakistani troops attend flag hoisting ceremony Reuters

"The Amu Darya oil contract is an important project between China and Afghanistan," China's ambassador to Afghanistan Wang Yu said in Kabul, according to the BBC. IANS news agency also reported that a Chinese state-owned company is likely to enter into a deal with Afghanistan for mining copper mine in the eastern region of the country.

Natural Resources in Afghanistan

Afghanistan has an estimated reserve of natural resources like natural gas, copper and rare earths that are worth at least $1 trillion. The country has great potential to tap these resources as it looks ahead and tries to go beyond the limits caused by miserable economic conditions. Unlike other regions in Central Asia, much of Afghanistan's resources have gone untapped in the past decades due to constant political upheavals and the grip of terrorism.

Political Significance

The signing of a deal between state-owned Chinese company and the Afghanistan government will have far reaching geopolitical significance. Beijing has not yet approved the Taliban administration but the growing cooperation between the countries signals the likelihood of China giving the stamp of approval to the Taliban administration.

US Exit and Rising China Role

The collapse of the US-supported government in Afghanistan and the return of the Taliban to power have given China unique advantages in the region. Beijing has turned Afghanistan's isolation into an opportunity for itself to play a bigger rile in the country, a VOA report said in August.

Oil exploration in the Mediterranean
Representational Image YouTube Grab

In lieu of offering the Taliban regime economic and development support, Beijing is expecting Kabul to address its own security concerns, especially with regard to the Uyghur situation. China is increasingly using the Taliban's help in ensuring Uyghur militant groups in Afghanistan do not target Chinese interests. This is crucial for Beijing as it pushes ahead with the ambitious Belt and Road Initiative (BRI) projects in the region, the report said.