Last year, it cut the shackles, took account of itself and reached out to the world. India was waiting.

The war had then barely ended and Afghanistan was still in the news for being the most dangerous place on earth. Despite this, the Confederation of Indian Industries (CII) took a decision to send a business delegation to Kabul. In less than 15 days, a team of 20 business leaders was put together to prospect for Indian participation in the reconstruction of the war-ravaged country. 

The aim was laudable but the logistics near impossible. For one, there was a real threat to life and limb as Kabul had not been fully sanitised. Second, there were no direct flights to Kabul. Third, hotel accommodation was nearly non-existent.

But the CII swung the trip. According to the Head of CII International, Piyush Bahl, "We flew from Delhi to Dubai. From there we had chartered a flight to Kabul. However, Pakistan refused permission for the charter to fly over its airspace. We were stuck. After several hours of frantic calling and meetings, we convinced Ariana, the Afghan Airlines, to hire out their aircraft to us. They agreed but the snag was of the return flight. An Afghan businessman settled in Dubai helped us by calling the Foreign Minister Abdullah Abdullah. If we could make it to Kabul, the return flight to Delhi was guaranteed." So, on a cold February morning this year, the Indian delegation landed in Kabul and checked into the only available hotel. They were four to a room, had to queue up to use the loo and made do with cold naans and bits of mutton tikka. 

The discomfort and the fear of hostile conditions on the streets were more than made up by the partnership that was struck during the trip. The Afghan businessman in Dubai, Iqbal Rashidzada, today heads the Indo-Afghan Business Forum and the groundwork laid then has led to the holding of the biggest ever four-day fair, the Made in India show, in Kabul since 1977. At least, this is what the 120-strong delegation thought at the inauguration till the Afghan Foreign Minister Abdullah Abdullah corrected them and remarked, "This is the biggest show I have ever seen in Kabul. It is a grand opening." Incidentally, India is the first country to exhibit its wares in Afghanistan. The Japanese will be the second.

The response to the show, that ended on September 29, can be gauged from the fact that over 25,000 people visited it during the four days it lasted. Out of these, 8700 were business visitors. They came not only from Kabul but also from Kandahar, Herat, Mazaar-i-Sharif, Jalalabad and other nearby towns. The exhibits were all sold out --- from tractors, generators, ambulances to tea and tools. 

The total business transacted was worth about Rs 25 crore. More importantly, of the 170 exhibitors from top companies, almost 60 per cent managed to appoint their dealers in Afghanistan. Another 10 per cent have started the process of setting up their offices in Kabul. Two agreements with Afghan partners were also signed-one for production of industrial and medical gas and another for setting up of a mineral water plant. Both these products currently come from Pakistan and are largely smuggled. Interestingly, industrialists Gautam Kapoor and Raminder Singh from Jalandhar are in the process of setting up a top-of-the-line restaurant in Kabul to cater to high-end diners in the capital city.

A large part of the success of the delegation can be ascribed to the enormous amount of goodwill that the Afghans have traditionally had for Indians. On the street or in the transition government, the Indians enjoy instant bonding with the Afghans. The Defence Minister, Marshal Fahim, underscored it when he said during his inaugural address that the relationship had weathered the test of time. He recalled how "India had stood firmly with us during the resistance movement and it has now taken a big leap by holding this exhibition." The Indian Foreign Secretary Kanwal Sibal responded by remarking: " It is a message of optimism. The political stake should be underpinned by an economic stake" in Indo-Afghan ties. The Indian Ambassador to Afghanistan Vivek Katju remarked that the Made in India show "is a great step to give confidence not only to our own business people but to others too that Afghanistan is stable and secure for business."

India has already committed $ 100 million to Afghanistan. One-third of this has already been disbursed. The three planes that the national carrier, Ariana, flies have been gifted by India. It is also running several training programmes for the Afghans, including courses in journalism, accounting and policing. Besides, a cold chain is likely to be established in Kandahar and a proposal is being whetted for improving the road from Bandar-e-Abbas in Iran to Kabul so that Indian goods can transit to this country quickly.

This is important for, given the state of Indo-Pak ties, the only viable route is through the port of Bandar-e-Abbas.

India has also drawn up a draft of the preferential trade agreement with Afghanistan that will ensure lower duties on import of dry fruits and other goods from this country. A high-level team will undertake a visit shortly to finalise the draft. Afghanistan, on its part, has offered iron-clad guarantees to foreign investments that could go up to 100 per cent of the total cost. Besides, tax breaks ranging from four to nine years are also on the anvil as is a 30-year lease on land for projects.

However, all this doesn't add up to a scenario wherein business can be seen to be moving on a fast track. Practical difficulties continue to dodge Indian businessmen. For one, Afghanistan is without a bank. All transactions are therefore in cash. In other words, if a businessman sells his goods in Kabul, the only way he can transfer money to India is through the Dubai hawala route. Not only is it illegal, it also involves a hawala cost and can be risky. According to Bahl, "It will take Afghanistan about four months to set up a regular banking system. It should be functional by January next, about the time that our companies will take to set up infrastructure here and start doing real business. As of now, we have helped our people by setting up a temporary fund transfer system through Dubai."

The other problem is the currency rate. About 50,000 Afghanis are equal to a dollar. Says Bahl, "The Afghan Government is in the process of demonetising its current currency and it should happen in this month itself. The new rate is likely to be about 40 Afghani per dollar."

Though Ariana flights are now operating out of Delhi and Amritsar, the VSNL is yet to activate the 0093 international call code for Afghanistan. Indians, therefore, cannot call up Kabul from India though there is access to incoming calls. "There was a lot of apprehension among the businessman on communication with Kabul," says Bahl, "After coming back, our Chairman, Trade fairs, Subodh Bhargava, who is also on the VSNL board, has succeeded in sorting out this matter. The 0093 code will be available shortly and it will cost only Rs 24 per minute."

Security is, of course, the biggest concern. Vivek Katju, who was described by the Afghans at the inaugural ceremony as 'Afghanistan's Ambassador to Afghanistan' and not as the Indian Ambassador to Afghanistan, admits that remnants of the Taliban and the Al Qaida are still there and there have been sporadic acts of violence during the last few months. "But the Afghan administration has the capacity to absorb these threats and they will not be able to disrupt the progress of events towards normalcy, stabilisation and security." The conditions are "healthy", he says, and they are more than matched by a "deep desire to promote bilateral ties. The good political understanding between the two nations will lead to a good economic understanding too."