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April 04, 2017 @ 01:15 PM

PM's Mongolia visit: Leveraging Mineral Resources?

Published : Monday, 25 May, 2015 11:07 AM

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PM’s Mongolia visit: Leveraging Mineral Resources?​

Mongolia is a landlocked country in Central Asia sandwiched between China and Russia. It is one of the most scantly populated countries of the world with population density of merely 1.77 persons per square kilometre. According to the World Bank data, population of Mongolia in year 2013 was just 2.839 millions, almost equal to the population of Lucknow or quarter of Delhi in India. Recently, NarendraModi became the first Indian Prime Minister in history to visit Mongolia to mark sixty years of establishment of diplomatic relations as well as the 25th anniversary of Mongolian transition towards democracy. This event was used by PM to elevate the ties between India and Mongolia to ‘strategic’ level. 

India- Mongolia Relations 

Relations between India and Mongolia can be termed as the cordial one. Though it was the first visit by an Indian PM to Mongolia, it was not the first visit by an Indian leader. In 2011, President PratibhaPatil visited Mongolia and defence and security pacts were signed between the two. On various other occasions, the Vice President, cabinet ministers and LokSabha speaker have also visited Mongolia. While Mongolia sided with Russia during the cold war era, India became the first non-Soviet Bloc country to establish diplomatic relations with it in 1955. India also supported the membership of Mongolia into the United Nations and Non Align Movement. India also had cultural and historical relations with Mongolia by virtue of Buddhism and the Muhgals who were the descendants of Genghis Khan, the founder of Mongol Empire. 

Agreements Signed During PM’s Visit

The Indian PM hailed his visit to Mongolia as ‘historic and path breaking’ and claimed that this visit will take relations with Mongolia to ‘spectacular heights’. The highlights of the visit were –

  • Elevating the ties to the level of ‘strategic partnership’.
  • USD 1.0 billion line of credit to Mongolia to develop institutions, infrastructure and human resources.
  • Intensifying the defence and security cooperation between two nations. 
  • Cooperation in development of mutually beneficially trade, investment and economic cooperation. 
  • Air Services Agreement 
  • Cooperation in the field of animal health and diary. Amul will help in establishing cooperative diary infrastructure in Mongolia. 
  • Cooperation in the field of renewable energy. 
  • Cooperation in field of culture for the year 2015-18.
  • MoU between Tata Memorial Centre of India and National Cancer Centre of Mongolia for gifting Bhabhatron-II telecobalt unit along with a radiotherapy simulator. 

Importance of Mongolia

India could benefit immensely by having warm, close and cordial relations with Mongolia as it could play a vital role in providing leverage to India in economics as well as geo-political settings. Some major benefits that can accrue to India by virtue of Mongolia are as under –

  • China’s policy to contain India by investing heavily in infrastructure and ports in Indian neighbours like Pakistan, Sri Lanka, Bangladesh, and Myanmar is not hidden from any one. India can counter this policy of China by investing in Mongolia with which, historically China had strained relations. For that matter, PM also visited South Korea which too is Chinese neighbour. India is also having cordial relations with Japan, another Chinese neighbour with which their relations are not very sweet. So the latest spurt in India-Mongolia relations can be a measure to counter the Chinese dominance in South Asia. 
  • Mineral resources in Mongolia are predicted to be worth of more than USD 1.0 trillion. Gold, copper, iron ore are present in vast quantities in Mongolia. The coal, petroleum and uranium reserves are estimated to be of 170 billion tonnes, 205 million tonnes and 68,000 tonnes. While cooperation in gold, copper, iron ore mining will help in the economic development of both the nations, the vast reserves of Uranium and petroleum are of special importance for India. As India is not self-sufficient in respect of both uranium and petroleum which are vital for energy security in India, close energy cooperation can address many woes of India. Mongolia was among the first few countries to sign a uranium deal with India.
  • In 2014, economic growth rate in Mongolia was 13% which is expected to cross 15% in 2015. This is the highest growth rate in the world and mining boom was one of the most important factors behind this extra-ordinary growth. By having close economic ties with such a high growth economy, India will also benefit from spill-over effects of growth.
  • India also has historical and cultural linkages with Mongolia. More people to people contact will help in cultural enrichment of both the countries. 

Importance of India for Mongolia

Mongolia is the second largest landlocked country after Kazakhstan. Though it is a giant country but it is sandwiched between two much larger countries – Russia in north and China in south. Due to its geographical proximity, China has great influence on Mongolia. Mongolians believe that unduly high dependence on China for trade and commerce is not good for them. Therefore, they are also looking for a third neighbour. By invigorating ties with India, Mongolia would be able to look beyond Russia and China. 

Thus, while Mongolia can reduce the dependence on its neighbours by having close ties with India, the Indian establishment latter would be able to counter China as well as benefit economically with the Mongolian assistance.     

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