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Since returning to power in August 2021, Afghanistan’s Islamist Taliban rulers have showcased ambitious infrastructure and natural-resource development projects as part of a quest for self-sufficiency.
The Taliban government is now digging one of the largest irrigation canals in Asia, a project that aims to revitalize long-parched plains in northern Afghanistan. It claims to have attracted billions of dollars in mining investments in an effort to finally capitalize on the country’s untapped wealth of natural resources. And the Taliban propaganda machine is in overdrive to paint its economic initiatives as a rapid advance toward self-reliance.
But experts see the hard-line Islamist group facing numerous challenges in its attempts to transform one of the world’s most aid-dependent countries into a self-reliant state.
Two years into its second stint in power, the Taliban government remains unrecognized globally and continues to be under crippling political and economic sanctions imposed over its dismal human rights record, terrorism connections, and failure to live up to promises to reverse course.
Experts also point to the Taliban’s reluctance to share verifiable and transparent data as reason to question its claims that it is on the road to economic independence that would shield it somewhat from international sanctions.
Hameed Hakimi, an Afghanistan expert at the Washington-based Atlantic Council think tank, says that self-sufficiency will remain a distant dream even if all the Taliban’s infrastructure projects come to fruition. “At best, their income will cover the security costs of maintaining the regime and pay for members who are now working for the Taliban interim government,” he said.
Hakimi stressed the need to distinguish between the self-sufficiency the Taliban is seeking for its government and the type of connected economy the isolated country needs. It’s impossible to imagine Afghanistan becoming self-reliant “before sanctions are fully removed, the economy is reconnected to the international system, and foreign development aid restarts flowing,” he said.
When the Taliban seized power, Afghanistan lost almost all the international aid that accounted for 75 percent of the government’s budget. Western and UN sanctions against the group cut Afghanistan off from the global financial system, which prompted fears that Afghan banks and even the state itself might collapse.
Despite the formidable obstacles, the country’s economy has somewhat stabilized. The national currency, the afghani, has been boosted by exemptions to certain economic and banking sanctions by the United States that allowed the weekly influx of millions of dollars. This, in turn, has kept the prices of essential commodities stable or even lower than neighbors struggling with high inflation.
Export and government revenues have also recovered due to aggressive taxation, and the Taliban has taken steps to tackle the administrative corruption that plagued the pro-Western government it ousted.
Since the spring of 2022, the Taliban has been digging the 285-kilometer-long Qosh Tepa Irrigation Canal. It aims to boost agricultural output by irrigating 550,000 hectares of desiccated land in three northern Afghan provinces with water from the Amu Darya, which forms parts of Afghanistan’s border with Tajikistan, Uzbekistan, and Turkmenistan.
In another step touted by the Taliban, a Chinese oil company has boosted production in Afghanistan to about 5,000 barrels a day, part of a broader effort to entice Beijing into helping the country extract its vast hydrocarbon and mineral reserves.
Graeme Smith, a senior Afghanistan analyst at the International Crisis Group, says that evaluating the success of such projects from afar is difficult. “We don’t know exactly how the Taliban are funding these projects, and we have not seen any published evaluations of their progress,” he said.
The Taliban has kept all national budgets a closely held secret. “We do not know exactly how much is incoming or outgoing from the treasury,” Smith said.
Nevertheless, he says that the Taliban appears to be fully committed to establishing self-sufficiency. “They want freedom from the whims of foreign donors for greater independence and the pursuit of their heterodox vision for Afghan society,” he said.
William Byrd, a development economist at the United States Institute of Peace in Washington, agrees. He says that the Taliban recognizes that foreign assistance will be much less than in the past. “The realism of this [self-sufficiency] quest can be questioned,” he said, but notes that Afghanistan under the Taliban has some scope to be less aid-dependent than it was in the past.
He says that by focusing on the development of agriculture and hydrocarbon extraction and mining, the Taliban can see positive gains, “both for import substitution and for export growth, thereby reducing the trade deficit.”
The landlocked country is still inhibited in its ability to establish export routes, however, according to Hakimi of the Atlantic Council, who says trade will depend heavily on good relations with neighboring Pakistan and Iran.
Kabul’s trade with Islamabad has rapidly plummeted in recent months after tensions over the Taliban’s support for the Pakistani Taliban boiled over. Both Tehran and Islamabad are now rapidly expelling hundreds of thousands of Afghans, which is placing additional stresses on the Taliban government.
“The humanitarian situation is worsening amid the risks from climate change and potentially millions of forced returnees arriving from Pakistan and Iran,” Hakimi said.
The Taliban’s pursuit of self-reliance is also clouded by governance failures and continuing Western sanctions, which don’t appear to be going anywhere until the Taliban moves to alleviate concerns about its human rights practices.
Since returning to power, the Taliban has recreated an even harsher version of its Islamic emirate from the 1990s. It has imposed severe corporal punishment and banned women from work, education, and public life. Its government has imprisoned, tortured, killed, and exiled critics, journalists, former officials, and soldiers.
By decisively ending its fight against the previous government, the Taliban has also been able to impose security around most of the country that could work to its advantage. “With violent conflict having abated and the regime controlling the entirety of the geography, Afghanistan can well be on its path to self-sufficiency,” Hakimi said.
Forming a functional and inclusive Afghan government, would help it get there, he adds.
In the meantime, Smith of the International Crisis Group says, Western pressures like sanctions and banking restrictions will continue to stand in the way. But he does not discount the possibility that the Taliban could meet the challenge.
“It’s too early to say whether their campaign for economic self-sufficiency will be successful, but I would not bet against it,” he said.
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