NEW DELHI: India will provide Mongolia with a $1 billion line of credit to help fund railway, power and other infrastructure projects, a much-needed boost for the north Asian country struggling to right its slowing economy.
“We will take our economic partnership to a new level,” Indian Prime Minister Narendra Modi said on Sunday at a joint press conference with his Mongolian counterpart, Saikhanbileg Chimed.
Mongolia is looking for ways to finance and expand a network of road and rail corridors to help increase mineral exports to China and beyond. It’s also developing new coal fired power plants and wind farms to reduce energy reliance on neighbouring Russia.
Mongolia has seen its economic growth slow from a world-beating 17.3 per cent in 2011 to 7.8 per cent last year amid a flight of foreign investment and low commodity prices. Modi on Sunday mentioned mining as a sector for joint cooperation, without providing details.
While trade between the two countries is almost negligible, just $16 million last year, Mongolia looks to India for a spiritual connection as the majority of its citizens follow Buddhism, founded in India 2,500 years ago.
Modi, the first Indian premier to pay a working visit to Mongolia, began his visit on Sunday at Gandan Monastery where he presented a sapling of the Bodhi tree.
He addressed lawmakers at a special session of Parliament and is due to attend a Mongolian sports festival.
India and Mongolia signed more than 10 agreements, including cooperation on border security, health, renewable energy, dairy farming and cyber security.
Mongolia is Modi’s second stop on a three-nation tour that also includes China and South Korea.
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