India stated that the Mongolian oil refinery, its largest Line of Credit (LoC)-backed infrastructure project, is expected to be operational by 2028, the Ministry of External Affairs (MEA) said on Tuesday.
The announcement was made during a special briefing by MEA Secretary (East) P Kumaran on the ongoing state visit of Mongolian President Khurelsukh Ukhnaa.
The refinery, funded by a $1.7 billion Line of Credit from India, is a major milestone in the bilateral partnership and a key project for Mongolia‘s quest for energy independence.
“The LoC of $1.7 billion is India’s largest LoC-supported project–the Mongolian oil refinery. The cost was originally estimated at $1.2 billion. There were some delays initially due to COVID-19 and the short construction season in Mongolia, where peak winter temperatures can reach -30 to -35 degrees Celsius, making outdoor work nearly impossible,” Kumaran said.
He added that most of the civil work is now complete and that equipment manufactured in India will soon be shipped to Mongolia.
“I just visited the refinery construction site last month. It is coming up very well. Almost all the civil work is over. The refinery equipment is being manufactured in India and will be shipped to Mongolia. It seems to be on track and we expect that by 2028, the refinery should be in operation,” he said.
The oil refinery is a high-priority project for Mongolia, which currently exports its crude oil. Once operational, the facility will allow the country to process its own crude, reducing dependence on imported refined petroleum products and strengthening its energy security.
Kumaran also highlighted growing interest in cooperation in critical minerals and renewable energy between India and Mongolia. Mongolia holds significant reserves of coking coal, vital for the steel industry. While India currently imports coking coal from Canada, Indonesia, and Australia, Mongolia is being explored as a new potential partner. However, logistical challenges remain.
“Mongolia has large reserves of coking coal. It is something that is useful for the steel industry. And India buys coking coal from a variety of partners, including Canada, Indonesia, and Australia. Mongolia offers itself as a potential partner for this. The difficulty, of course, happens to be the fact that Mongolia is landlocked and depends on ports and neighbouring countries to be able to ship out the coal. Most of their coal is currently exported to China,” he stated.
“If India is to buy coking coal from Mongolia, it will have to be either through Tianjin port in China or through Vladivostok in Russia… We are talking to the Russians and the Mongolians to see what kind of arrangements can be made to bring Mongolian coal through the Trans-Siberian Railway to Vladivostok and see how exactly the economics play out,” Kumaran further noted.
He also mentioned Mongolia’s recent deal with France for uranium processing and confirmed that India has expressed interest in collaborating with Mongolia on uranium and other minerals such as copper, gold, iron, and zinc.
“Mongolia also has a few other minerals of interest to us, including copper, gold, iron and zinc, and recently they have also unearthed uranium reserves. They have just signed a big 1 million tonne per annum deal with France for the unearthing and processing of uranium. We have also offered our interest in partnering with Mongolia for uranium. We will be taking up the dialogue in the coming months,” the MEA Secretary (East) stated.
In the area of renewable energy, Kumaran said Mongolia has great potential due to its climate and geography.
“President Khurelsukh told Prime Minister Modi that the southern parts of Mongolia receive about 230 days of good sunlight annually. With its low population density and clean air, the country is well-positioned to develop large-scale solar fields,” he said.
Mongolia has just signed the framework agreement to join the International Solar Alliance (ISA), and both countries are now exploring ways to collaborate on renewable energy projects.
Kumaran further stated that India will be sending the sacred relics of Arhant Sariputta and Arhant Mahamogallana to Mongolia in 2026 as a gesture of spiritual goodwill aimed at deepening spiritual and civilisational bonds between the two nations, following the historic exposition of the Kapilavastu relics in 2022.
Kumaran further stated that several other initiatives were announced to bolster India-Mongolia relations, including the deputation of a Sanskrit teacher to the Gandan Monastery for one year to support monastic Sanskrit education and the launch of an ICCR-supported youth orientation programme under which eight Mongolian students and faculty will visit India.
Kumaran also announced an increase of 70 ITEC (Indian Technical and Economic Cooperation) training slots for Mongolian nationals.
“As a goodwill gesture towards the spiritual fulfilment of our Mongolian brothers and sisters, India will send the holy relics of Arhant Sariputta and Arhant Mahamogallana to Mongolia in 2026, following the historic exposition of Kapilavastu relics in 2022. Other key announcements include the deputation of a Sanskrit teacher to Kandhan Monastery for one year to enhance monastic Sanskrit capacity, the launch of an ICCR youth orientation trip under which eight Mongolian students and accompanying faculty will visit India, and the provision of an additional 70 ITEC slots for Mongolian nationals,” he stated.
According to the Maha Bodhi Society of India, Arahant Sariputta and Arahant Moggallana were the two principal disciples of Lord Buddha. Revered for their wisdom and spiritual accomplishments, they hold a prominent place in the history of Buddhism.
The announcement came as part of a series of initiatives unveiled during President Ukhnaa’s visit, which marks the 70th anniversary of India-Mongolia diplomatic relations and the 10th anniversary of their Strategic Partnership.
During the visit, Prime Minister Narendra Modi and President Ukhnaa jointly released commemorative postal stamps celebrating 70 years of diplomatic ties. The leaders also oversaw the signing of 10 Memoranda of Understanding (MoUs), including one between the Ladakh Autonomous Hill Development Council and Mongolia’s Arkhangai Province to boost cultural exchanges.
Mongolia also reiterated its support for India’s permanent membership in the UN Security Council and its candidature for a non-permanent seat in 2028-29.
In a significant step forward in defence cooperation, India announced the appointment of a resident Defence Attache in Ulaanbaatar, addressing a long-standing request from Mongolia.
Further enhancing bilateral connectivity and exchange, India confirmed that all e-visas for Mongolian nationals will now be issued free of charge (gratis), aimed at boosting travel and people-to-people ties.
“Mongolia reiterated its support for India’s permanent membership of the UN Security Council and also for India’s candidature as a non-permanent member of the UN Security Council for 2028-29. Mongolia also signed the framework agreement of the International Big Cat Alliance, reflecting our shared commitment to conservation. The announcement of the appointment of a resident defence attache in Ulaanbaatar fulfils a long-standing Mongolian request and underscores the growing defence partnership. India also announced that all e-visas to Mongolian nationals would be issued on a gratis basis,” the MEA Secretary added.
Meanwhile, Mongolian President Ukhnaa, during a joint press statement with PM Modi, stated that the Mongolian Air Carrier is preparing to operate flights to New Delhi and Amritsar, which are expected to start later this year and provide a boost, especially to the tourism and business sectors.
“Mongolian air carrier is preparing to operate charter flights to New Delhi and Amritsar starting later this year, which will make a substantial contribution to expanding our bilateral relations and cooperation, including tourism and business sectors,” he said.
He also hailed the friendship of the spiritual neighbours and invited PM Modi to pay a state visit to Mongolia.
The Mongolian President arrived in Delhi on Monday for a four-day state visit.
