China takes the long view about investing in Afghanistan, and how to protect those investments. Since 2002 China has tried, without much success, to establish extractive industries (oil and copper) in Afghanistan. While these efforts have not succeeded yet China knows there is a lucrative (mainly to gangsters and Islamic terrorists) illegal mining industry that generates half a billion untaxed dollars a year. China would like to help Afghanistan change that. Nothing new there, China has helped before.
But Afghanistan was, for over a thousand years, a lucrative branch of the Silk Road between China and South Asia, the Middle East and points west. China is rebuilding that route via railroads in Central Asia, Pakistan and Southeast Asia and now roads (and eventually railroads) through Afghanistan as well. The key to success is security. If the route is not safe, commerce will not use, and support, the route. Afghanistan is a special case as it was always one of the most dangerous portions of the Silk Road. To deal with that China is making a unique investment that is likely to succeed and it is all about border security. In early 2018 China agreed to pay for an Afghan military base in northeast Afghanistan (Badakhshan province) on the border with Tajikistan. China would also pay for equipping and arming the Afghan border guards at the base, as well as their salaries. China would have someone there to ensure the money went where it was supposed to and to monitor the performance of the Afghan troops.
This base would provide more security for a road from Afghanistan, via Tajikistan that carries mostly Chinese truck traffic and a growing number of Islamic terrorists going in both directions. China is particularly concerned with Chinese Moslems (mainly Turkic Uighurs) travelling to Afghanistan to join Islamic terror groups, gain some experience and return to China. The most direct land route from Afghanistan to China is this road in Tajikistan that has been used for over a decade to move Chinese workers and equipment into Afghanistan. In 2016 the road also moved Chinese troops into Afghanistan for joint security patrols with Afghan forces. These patrols ended in late 2016 but apparently continued on the Tajik side of the border in a more limited fashion.
This base building deal is an outgrowth of a 2017 deal in which Afghanistan agreed to allow Chinese firms to enter Afghanistan and examine if it was possible to rebuild the railroad from Tajikistan (the Sher Khan dry-port in Kunduz province) to Herat (the Iran border) as well as a separate project to build dams and hydroelectric facilities on the Kabul River. The Chinese are not certain if either project can be built much less maintained because of the corruption and violence (from the Taliban, drug gangs and assorted other bandits). China has more patience than most. The Sher Khan dry-port facility and existing roads are an example of what usually happens. Afghan officials in charge of maintaining these facilities steal as much of the money they receive for running and maintaining these facilities and often extort more cash from users. The opium/heroin gangs depend on widespread corruption to stay in business and most Afghans see nothing wrong with the many practices which wealthier and better run nations consider corruption. This is not an easy problem to fix and while China has its own problems with corruption most Chinese accept the fact that corruption is, in the long run, bad for everyone. Meanwhile the Taliban and Afghan security forces continue to fight for control of the Tajikistan border around where Sher Khan is because that is also the best route for illegal opium and heroin exports. Further east the situation is quieter and that’s where the new base is being built.
China already has a lot of experience trying to do business in Afghanistan. Most of these efforts were failures, but all of them were instructive. For example in late 2016 the Taliban announced that it would not interfere with a huge copper deposit 40 kilometers southeast of Kabul at Mes Aynak. Such assurances were necessary turn that copper into cash. In 2008 China signed a deal with Afghanistan that gave them 30 years to develop a mine there and ship copper out. Mes Aynak is believed to be one of the top three copper deposits in the world and worth $50 billion or more if it ever got into production. But China has not moved because of the lawless situation in Afghanistan. The Afghan government believed the Taliban were trying to entice the Chinese to begin construction so the Taliban could extort regular payments to “protect” the facility from attack. That really doesn’t work in Afghanistan, where there are too many potential attackers offering the same deal. The copper mine project never really got going because of the security problems. The Chinese are accustomed to paying bribes but they found the situation in Afghanistan too complex to handle. There were too many armed groups competing with each other to sell China “protection.” But the Chinese to not give up easily.
Earlier in 2016 China announced it would provide Afghanistan with $70 million in military aid. This was a continuation of increasingly close relations with China. For example in early 2015 Afghanistan admitted that it had an arrangement with China whereby Afghanistan would seize and turn over to China any Chinese Moslems (especially Turkic Uighurs) found in Afghanistan. In return China increased the diplomatic and economic pressure on Pakistan to stop supporting Islamic terrorists attacking Afghanistan. China is the largest foreign investor in Pakistan as well as the main source of modern weapons, so when China talks Pakistan must listen and at least pretend to act (which was all the Chinese could get from Pakistan). China is also becoming a major source of foreign aid and military assistance for Afghanistan.
There had been some partial successes. In 2011 the Afghans made a deal with China to allow Chinese oil companies to explore for oil in the northwest. The Chinese contract included China building a refinery in the north as well, which could make Afghanistan able to eliminate nearly all fuel imports. In late 2012 a Chinese firm began pumping oil from a well northwest (the Amu Darya basin) Afghanistan. This was a first for Afghanistan and the Chinese expected to get 2,000 barrels a day from this well and began drilling others. The government had to send 300 police to guard the Chinese as a local warlord was demanding payments to allow the exploration. Potential foreign investors tried to convince Afghan leaders to get the corruption and violence under control, at least in areas where lots of minerals, oil and natural gas are found. Exporting these raw materials (mostly via the northern routes) would be a major boost to the Afghan economy. But too often, local warlords and greedy government officials steal so much (in bribes and outright theft) that foreign investors quit or simply won’t come in. A lot of senior Afghan leaders realize how this has to work but that was not enough. It wasn’t in this case and oil production was halted in late 2013. The contracts with Chinese and Afghan companies to develop this oil field were cancelled in 2017. Chinese and Afghan firms were ready to invest $1.5 billion to build a refinery in Afghanistan but apparently corruption and Afghan politics got in the way. So the Chinese are taking the initiative to create security one tiny step at a time.
Earlier China was approached about building a direct route from China to Afghanistan via the short border the two countries share. But this is an odd border. It is reached through a long, narrow panhandle (the Wakhan Corridor), and the actual border with China is only 76 kilometers long. The actual passage between Afghanistan and China is the 4,923 meter (15,261 feet) high Wakhjir Pass.
The Wakhan Corridor area has never been very violent, and escaped most of the fighting that has torn apart Afghanistan since the 1970s. But China refused to open its border with Afghanistan, fearing complications with the mainly Moslem population on their side of the frontier. There are other problems with this border. There no roads through the pass, only trails. The pass is closed five months of the year by snow. For several more months the pass is closed intermittently by bad weather. The Wakhan Corridor itself was once part of the Silk Road, but only when weather allowed caravans through. The Chinese Wakhan Corridor border has been closed to traffic for over a century and China considers it too difficult and expensive to build a road or rail line through the Wakhan Corridor. The road via Tajikistan works because it is open all year and safe.
Google Earth images have shown that China built a new road to the border area, along with additional guard posts after 2010. The Chinese road was only built to make it easier to move border guards, and their supplies, to the frontier.