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EDITORIAL: With the US withdrawal of troops under way, a US administration official reportedly stated that "any Central Bank assets the Afghan government have in the United States will not be made available to the Taliban." While this claim has not been confirmed by any senior member of the Biden administration yet, however given the horrendous pictures of hundreds of Afghans trying to leave the capital by scaling on a plane's fuselage and five falling to their deaths as the plane took off, and domestic criticism of Biden's decision to leave Afghanistan prompting him to return to Washington DC to defend his decision, one would assume that the unnamed official's statement is credible.

The amount of Afghanistan's gross reserves was estimated at 9.4 billion dollars end April this year according to the International Monetary Fund (IMF) consisting of its total foreign exchange reserves, the country's reserve position at the IMF, monetary gold reserves and US dollar value of SDR holdings by the Afghan State Bank. However, reportedly, most of these reserves are held outside Afghanistan though the exact amount held outside or in the US is not known though one would assume that the bulk of these reserves are held in the US/Europe which perhaps is the only leverage that may be used with the Taliban to ensure that all those given visas by the West, particularly those who worked with foreign forces during the last two decades, are allowed to leave the country.

Irrespective of whether this leverage would be accepted by the Taliban leadership, it is relevant to note that in the first decade of US-led military engagement in Afghanistan aid accounted for around 100 percent of the country's Gross Domestic Product - a rate that has been declining since 2009 as the drawdown of foreign forces began in 2009. It is perhaps fair to state that the reliance on foreign aid remained a significant contributor to the Afghan budget. In this context, it is relevant to note that foreign aid was forthcoming from NATO countries as well as multilaterals particularly the International Monetary Fund (which disbursed 370 million dollar loan to Afghanistan to help support the economy amid the Covid-19 pandemic less than two months ago), the World Bank (total disbursement of around 5.3 billion dollars mainly in grants) and Asian Development Bank due to the West's pervasive influence on their managements and boards though their engagement was more towards community-based projects.

Two decades down the line the Taliban face a different world entirely: China has emerged as an economic power rivaling the US - a fact that may have led Biden to call on the G-7 to support a Build Back Better World (envisaging assistance to build infrastructure in the developing world) to counter China's One Belt One Road initiative. China has also asserted its rights in the disputed Himalayan region with India that is certainly another factor in strengthening of the US-Indian strategic partnership. Russia has been sanctioned by the Biden administration and there are clear signs that Russia may be amenable to accepting the Taliban if they play their cards right. Turkey and Qatar have clearly and unambiguously stated that they would like to be engaged with the new government in Kabul. And Pakistan of course requires guarantees that the Taliban would not allow the Tehreek-e-Taliban Pakistan (TTP) sanctuary from where to launch attacks against Pakistan. However, time will tell whether Taliban would take advantage of these new realities or not.

In this context, it is relevant to note that the US Senate Committee on foreign affairs made some sage and succinct recommendations with respect to assistance to Afghanistan 10 years ago that were never adhered to: develop a multiyear strategy that defines US assistance goals and the tools, authorities, and oversight mechanisms necessary for a successful military drawdown and transition; reevaluate the performance of stabilisation programmes in Afghanistan and reallocate funds as necessary and follow a simple rule: donors should not implement projects that Afghans cannot sustain. Sadly, this advice was not followed in Afghanistan and is not being followed by donors in several developing countries even today.

Copyright Business Recorder, 2021


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