Zydus Lifesciences Ltd. will export medicines to Afghanistan and later establish a local manufacturing plant, in what is seen as another mark of renewed economic engagement between India and the Taliban-ruled country.
The company signed a memorandum of understanding worth $100 million with Kabul-based Raoufi Group in the United Arab Emirates on Thursday.
The Afghan Ministry of Industry and Commerce, in a press release, stated that Zydus will initially export its pharmaceutical products to Afghanistan. Later, the company’s 24/7 representative office will be relocated there, where it will begin domestic drug production.
The agreement comes days after a high-ranking delegation led by Afghan Commerce Minister Al-Haj Nooruddin Azizi visited India.
During this trip, he met with senior Indian government officials and private sector representatives for detailed discussions regarding investment opportunities in Afghanistan.
Azizi on Monday said his government is ready to offer five years of tax breaks to firms investing in new sectors, including gold mining. Speaking at an interactive session organised by business chamber Assocham, Azizi said tensions with Pakistan creating hurdles in trade.
"There is a huge potential available in Afghanistan. Even you will not find a lot of competitors. You will also receive tariff support, and we will be able to give you land. The five-year tax exemption will be given to companies who may be interested to invest in new sectors," the minister said.
Kabul will charge only 1% tariff if Indian firms import machinery for investment, he said.
"Gold mining will definitely require the technical and professional team or professional companies. So initially, we are requesting that you send your team, they can do the research, they can do the exploration initially, and then they can start work. However, the condition is that we will expect it to be processed in the country so jobs can be created," the minister said.
(With PTI inputs)
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