India announced that Mongolia’s upcoming oil refinery, its largest Line of Credit (LoC)-backed infrastructure project worth USD 1.7 billion, is expected to become fully operational by 2028.

The update came from Ministry of External Affairs (MEA) Secretary (East) P. Kumaran during a briefing on the ongoing state visit of Mongolian President Khurelsukh Ukhnaa to India.

The refinery marks a landmark in India–Mongolia relations and represents a significant step towards Mongolia’s long-term goal of achieving energy independence. Originally estimated at USD 1.2 billion, the project faced delays due to COVID-19 restrictions and harsh winter conditions, which make outdoor construction nearly impossible in temperatures dropping to -35°C.

Kumaran noted that the refinery’s civil construction phase is largely complete, and equipment manufactured in India will soon be transported to Mongolia. He expressed optimism that the project remains “on track” and will commence production by 2028. Once operational, the facility will enable Mongolia to process domestic crude oil instead of exporting it, cutting dependence on imported fuels and enhancing its energy security.

Beyond the refinery, the MEA highlighted growing collaboration in critical minerals, with Mongolia’s vast coking coal reserves offering potential value for India’s steel industry. Currently, India imports coking coal from Canada, Indonesia, and Australia, but logistical hurdles persist since Mongolia is landlocked and exports most of its coal to China.

Discussions are underway to explore transportation routes via the Tianjin port in China or Russia’s Vladivostok port. Kumaran indicated that India is engaging both Mongolia and Russia to examine the feasibility of transporting Mongolian coal through the Trans-Siberian Railway to Vladivostok, assessing the economic viability of such arrangements.

India also expressed interest in partnering with Mongolia for exploration and processing of uranium and other strategic minerals, including copper, gold, iron, and zinc. Mongolia recently finalized a one million tonne per annum uranium extraction and processing deal with France, strengthening its position as a key player in the global minerals sector.

Renewable energy emerged as another promising avenue of cooperation. With around 230 days of bright sunlight annually in southern Mongolia, the country possesses favourable conditions for large-scale solar power development. During bilateral talks, President Khurelsukh underscored Mongolia’s readiness to partner with India on solar energy initiatives.

Mongolia has also signed a framework agreement to join the International Solar Alliance (ISA), further aligning both nations on clean energy collaboration and climate sustainability efforts.

The visit marks both the 70th anniversary of India–Mongolia diplomatic ties and the 10th anniversary of their Strategic Partnership. Prime Minister Narendra Modi and President Khurelsukh jointly released commemorative postal stamps celebrating these milestones. The leaders also witnessed the signing of 10 Memoranda of Understanding (MoUs), including an agreement between Ladakh’s Autonomous Hill Development Council and Mongolia’s Arkhangai Province to promote cultural exchanges.

In a major step forward, India announced the appointment of its first resident Defence Attache in Ulaanbaatar, fulfilling a long-standing Mongolian request and deepening defence cooperation. India also confirmed that e-visas for Mongolian citizens will now be issued free of charge, encouraging travel and strengthening people-to-people ties.

Mongolia reaffirmed its support for India’s permanent membership in the UN Security Council and endorsed India’s candidature for a non-permanent seat for 2028–29. The country also joined the International Big Cat Alliance, demonstrating shared commitment toward wildlife conservation.

President Khurelsukh revealed that the Mongolian Air Carrier is preparing to launch charter flights connecting New Delhi and Amritsar later in 2025. The new air routes are expected to significantly enhance tourism and business connectivity between the two nations. He described India and Mongolia as “spiritual neighbours” and extended an invitation to Prime Minister Modi for a state visit to Mongolia.

President Khurelsukh’s four-day visit underscores the enduring partnership between New Delhi and Ulaanbaatar, encompassing diplomacy, defence, energy, culture, and spirituality—signifying an important chapter in India’s strategic outreach across Central and East Asia.

Based On ANI Report