Kabul Offers Tax Breaks, Restarts Air Corridor to Lure Indian Investment

DID Press: Taliban government announced new incentives—including a five-year tax exemption for new industries and a 1% import tariff on raw materials and machinery—to attract investment and boost domestic production. Nooruddin Azizi, the Taliban’s Minister of Industry and Commerce, outlined the measures during a meeting at the New Delhi Chamber of Commerce, saying they are designed to create a “flexible and enabling environment” for investors, particularly Indian companies.

According to Azizi, industrial units that increase production by 20% will receive additional government support, and this assistance will continue to expand alongside output growth. He also announced the reactivation of Kabul–Delhi and Kabul–Amritsar air corridors, emphasizing that Afghanistan is prepared to offer financial incentives and cooperate with India and Iran to keep the Chabahar trade route operational.

At the meeting, M. Prakash Anand, India’s Deputy Foreign Minister, said the two sides agreed to appoint commercial attachés in their embassies and revive joint working groups on trade and investment.

Azizi, noting major challenges such as Pakistan’s closure of border crossings, blocked transit routes, and the U.S. freeze on USD 9.3 billion of Afghanistan’s foreign reserves, called on India to help maintain access to the Chabahar port. He said Afghanistan’s priority is identifying the “lowest-cost corridors” and supporting all necessary transport infrastructure.

The minister described the current USD 1 billion trade volume between the two countries as “far below potential,” highlighting India’s significant opportunities in Afghanistan’s dried fruits, carpets, raw materials, and mining sector. He added that any trader presenting a clear business plan would receive all possible government facilities.