Some 17 years after the U.S.-led invasion to oust the Taliban from power, Afghanistan remains one of the world’s poorest countries, highly dependent on foreign aid. In addition, Afghanistan is a land-locked nation that depends on imported goods for its basic staples. Afghanistan, therefore, needs access to neighboring countries for vital supplies, and trade as well as to a sea-port to bring in vital commodities.
So what are Afghanistan’s options? To its south, it has Pakistan. To its west it has Iran. And to its north it has former Soviet republics of Tajikistan and Turkmenistan. And to its east, it has China. Only Pakistan and Iran, can offer Afghanistan with easy access to a sea port. Iran, too, has close cultural and linguistic links with Afghanistan, which also renders it easier for trade and communication. China, Pakistan and Iran, have strong vibrant domestic industry, most goods on the street in Afghanistan originate from these countries.
The core issue, however, is that Afghanistan’s relationship with Pakistan has been strained for a long-time. In addition, Pakistan has historically provided very poor support for Afghan trade. To rebuild the Afghan economy by relying on Pakistan is inherently problematic.
Thomas Lynch, a National Defense University expert and a former U.S. Army officer who advised the chairman of the Joint Chiefs of Staff on South Asia policy stated in an interview with Reuters recently that “There is no other legitimate and reliable way to (import goods to Afghanistan). You can’t do it by air, you can’t do it through Pakistan because they just extort for everything they do,” said Lynch. “The lifeline runs through Chabahar (in Iran).”
U.S. President Donald Trump’s decision to pull out of the Iran nuclear accord and re-impose sanctions on Tehran therefore fundamentally threatens to derail a project to help build Afghanistan’s economy, endangering a key goal of the U.S. strategy to end America’s longest war.
There is a massive resurgence of Taliban power that has resulted in huge swaths of Afghanistan now being controlled again by the Taliban. By some accounts almost 50% of the country is once again ‘ruled’ by the Taliban. Trump’s sanctioning of Iran fundamentally undermines the U.S. backed government in Kabul, and in effect lends support again to the Taliban.
One strategy the U.S. employed, was to ask India to participate in the reconstruction of Afghanistan. And the Indians, invested in upgrading Iran’s Chahbahar port complex, with a specific view of importing vital supplies to Afghanistan to help transform the Afghan economy.
The Indian-backed Chabahar port complex in Iran is being developed as part of a new transportation corridor for land-locked Afghanistan that could potentially open the way for millions of dollars in trade and cut its dependence on Pakistan, its often-hostile neighbor.
Building Afghanistan’s economy would also slash Kabul’s dependence on foreign aid and put a major dent in the illicit opium trade, the Taliban’s main revenue source.
But Trump’s decision to re-impose sanctions on Iran and penalize financial institutions for doing business with Tehran is clouding Chabahar’s viability as banks, nervous they could be hit with crippling penalties, pull back from financing.
“President Trump’s decision has brought us back to the drawing board and we will have to renegotiate terms and conditions on using Chabahar,” a senior Indian diplomat said. “It is a route that can change the way India-Iran-Afghanistan do business, but for now everything is in a state of uncertainty.”
Launched in 2016, the joint Iran-India-Afghanistan Chabahar project already was facing holdups. It has yet to see significant traffic apart from some containers of donated wheat from India, and the first shipments of Afghan dried fruit to India are not expected before July.
At least three contracts to build infrastructure at the port now have been delayed, with two Chinese companies and a Finnish group left hanging while bankers seek clarity from Washington before approving guarantees, a person close to the project said.
In addition, Afghan traders, who were hoping for an alternative to Pakistan’s port of Karachi, now find themselves cut off from funding and forced to rely on the traditional hawala money transfer system, which is insufficient on its own to transform an economy. Hawala is a trust-based system commonly used in Afghanistan that involves the movement of funds between agents in different countries.
“We know our correspondent banks would not let us pay for imports coming through that port,” said a senior executive at one major Afghan lender.
Chabahar is among a number of projects of transport and energy networks projects designed to boost Afghanistan’s trade and lay the foundations for a mining industry capable of exploiting its billions of dollars in untapped mineral reserves.
Bypassing the border with Pakistan, which last year was closed for some 50 days over various disputes, Chabahar is seen as a way for Afghanistan to consolidate its relationships with India and other regional powers.
“The only way to get India more involved” in Afghanistan’s economic development “is through Chabahar,” said Barnett Rubin, an expert with New York University’s Center for International Cooperation and a former adviser to the State Department and the United Nations. “Our Iran policy is headed for a train wreck with our Afghanistan policy.”
With India via Iran, direct Iranian, and direct Pakistani goods becoming increasingly difficult to source for Afghan traders, the U.S. is essentially forcing Afghanistan to consider options to its East i.e. China. The country is being thrown into Chinese arms!
Once again, U.S. does all the heavy lifting, ‘liberates’ a country, and then hands it to a rival regional player.
Apart from illegal opium exports estimated at some $2 billion by the International Monetary Fund, its main products are dried and fresh fruits, and carpets, none of which amount to more than a fraction of the value of the drugs trade.
Initially Afghanistan would export agricultural produce – such as pomegranates and grapes – through Chabahar, utilizing a section of a road India paid for and then an extension to the Iranian border that New Delhi built, experts said.
Eventually, those exports could expand to mineral resources, something Trump has expressed an interest in gaining for U.S. firms. For India, this would mean using a planned railroad to Chabahar to export iron ore from two tracts at the Hajigak iron mine in central Afghanistan that it won the rights to exploit, the experts said.
This whole policy undermines another Trump goal of pressuring Islamabad to shutter Afghan insurgent sanctuaries on its side of the border and force the militants into peace talks. `
The whole policy seems badly short-sighted. Its Iraq-War redux again. Everyone is jumping quickly into an anti-Iranian rhetoric and ‘war’ without really weighing the costs and impact. As people keep reminding us Trump shoots from the hip and has nothing except soundbites for the media. There is no deep strategic thought being given to any policies in this administration.