Afghanistan’s history of governance has been marked by drastic shifts, beginning with the fall of the monarchy in 1973. This was followed by a Soviet-backed communist regime, a decade-long Soviet occupation ending in 1989, and a civil war that led to the rise of the Taliban in the mid-1990s. The Taliban imposed strict Islamic rule until their ouster by U.S.-led forces in 2001. Efforts to establish a democratic government over the next two decades were plagued by corruption, internal strife, and the Taliban’s resurgence. This ongoing instability has significantly hampered Afghanistan’s economic development, culminating in the Taliban’s return to power in 2021.
On August 19, the Afghan Taliban’s interim government will mark its third year in power, yet there is little for the Afghan people to celebrate. Since the Taliban’s takeover, Afghanistan’s economic situation has deteriorated rapidly. The country, heavily reliant on foreign aid, faced a sharp decline in international support as Western nations froze assets and halted financial assistance. This decision severely impacted Afghanistan’s already fragile economy, which contracted by approximately 30% in 2021 alone, according to the World Bank. With inflation soaring, unemployment rising, and basic services deteriorating, state institutions have eroded.
Taliban’s limited understanding of economic management, coupled with their ideological rigidity, has failed to foster a stable and predictable business environment necessary for economic growth. As a result, the economic crisis has plunged millions of Afghans into poverty, with the UN warning of an impending humanitarian catastrophe as over half the population faces acute hunger. This dire situation has fueled public discontent and significantly undermined the Taliban’s legitimacy, especially in urban areas where expectations for improved living standards were high.
The Afghan Interim Government’s (IAG) alliances with various terror groups, including Tehrik-i-Taliban Pakistan (TTP), ISKP, and al-Qaeda (AQ), have further complicated the economic landscape. These alliances have made the international community wary of engaging with the Taliban regime, which has allowed terrorists to use Afghan soil in violation of their Doha commitments. This reluctance to engage has led to a freeze on aid and investment. Additionally, the Taliban’s support for these terror groups has strained relations with regional partners, including Pakistan. Pakistan, which has historically supported Afghanistan, is now frustrated by the Taliban’s inaction against the TTP, which has intensified attacks on Pakistani soil.
Concerns about potential violence spillover from Afghanistan have been voiced by neighboring countries such as Pakistan, China, and Iran. These countries have urged the Taliban to take decisive action against terrorist groups, but the Taliban’s response has been inconsistent and often driven by internal power struggles rather than strategic considerations. Despite Taliban denials, reports from SIGAR and intelligence agencies confirm the continued presence of AQ and TTP, raising fears that Afghanistan could become a terrorism hub once more.
Pakistan, like other neighboring countries, is deeply affected by Afghanistan’s economic and humanitarian crisis. Regional stability is closely linked to economic cooperation, and Afghanistan’s failure to stabilize its economy could derail potential trade and development projects benefiting the entire region.
In light of these challenges, it is crucial for the Taliban to address the concerns of neighboring countries, particularly Pakistan. Afghanistan’s geopolitical reality is such that its stability is closely tied to the attitudes and actions of its immediate neighbors. Constructive engagement with these countries could help mitigate external pressures exacerbating internal issues like economic hardship and security threats. The adage “one cannot change neighbors” underscores the importance of these relationships. Afghanistan’s future prosperity depends on maintaining healthy ties with its neighbors. Ignoring or antagonizing them risks further isolation, deepening the political and economic crises facing the Taliban. By prioritizing regional cooperation and addressing legitimate concerns, the Taliban could secure the political respite needed to stabilize their rule and rebuild Afghanistan.
