INDIA has announced a credit line of US$1 billion to Mongolia to expand its economic capacity and infrastructure. This forms part of a decision to upgrade the relationship between the two countries from Comprehensive to Strategic Partnership.
In May Narendra Modi became the first Indian Prime Minister to visit Mongolia where he held wide ranging talks with Mongolian PM Chimed Saikhanbileg following which the countries signed agreements covering defence, cyber security, agriculture, renewable energy and health.
PM Modi said: “I am pleased to announce that India will provide a Line of Credit of $1 billion to support expansion of Mongolia’s economic capacity and infrastructure.” He said the destinies of the two countries were closely linked with the future of the Asia Pacific region.
“We can work together to help advance peace, stability and prosperity in this region. In a reflection of our commitment to further deepen our relationship, we have decided to upgrade our Comprehensive Partnership to a Strategic Partnership. It is a special privilege to come on the occasion of two important milestones that unite us - 25 years of democracy in Mongolia and 60 years of diplomatic relations between our two nations.”
Commenting on his counterpart’s remarks that India is the “spiritual neighbour and third neighbour” of Mongolia, Mr Modi said, “We will always fulfil the responsibility that comes with this honour. We have strong convergence of views on bilateral relations and our regional and international partnership. The agreements we have signed speak to the depth of the relationship.”
Noting that trade and investment relations between the two are modest, Mr Modi said, “We will take our economic partnership to a new level. There is huge potential in the nuclear sector, mining, healthcare, pharmaceuticals and dairy. We should also explore the possibilities of using digital technology to expand our economic relations.”
India has a strong linkage of Buddhism and democracy with Mongolia and was the first country outside the Soviet bloc to establish diplomatic relations with it.
The Indian PM also announced an increase in the ITEC training slots for Mongolia from 150 to 200 and the establishment of an India-Mongolia Joint School.
“I conveyed to the Prime Minister that we greatly value our international partnership, which is based on friendship, shared spiritual heritage and democratic values. These also provide solid foundation for our cooperation in our region,” Mr Modi said.
India feels there is excellent potential for cooperation in the minerals sector as Mongolia is rich in coking coal, copper, rare earths and uranium. India has a civil nuclear agreement with Mongolia which provides for uranium exports to the country once domestic laws permit prospecting and mining.