Understanding Afghanistan Synthesis Report

Synthesis Report
UNDERSTANDING AFGHANISTAN
The Consolidated Findings of a Research Project Commissioned by Her Majesty’s Government
SULTAN BARAKAT
November 2008
This report was produced as part of a significant research project commissioned by the British
government and implemented by the Recovery & Development Consortium.
The views expressed in this report are those of the authors and do not represent UK government policy.
The following Recovery & Development Consortium members were involved in this project:
DFID Understanding Afghanistan – Synthesis Report
Acknowledgements
Report Author:
Sultan Barakat
This report provides a synthesis of more than 500 pages of scholarship generated in the course of
the ‘Understanding Afghanistan’ research project commissioned by DFID Afghanistan. The entire
undertaking includes a Political Economy Analysis led by Peter Middlebrook, a Strategic Conflict
Assessment led by myself, Sultan Barakat, a Growth Diagnostic Scoping Study led by Alfie Ulloa and
Sharon Miller, and a Poverty, Gender and Social Exclusion Analysis led by Sippi Azarbaijani-
Mogaddam. ‘Understanding Afghanistan’ draws upon insightful contributions not only from these
output leaders but also from the individual team members: Jonathan Goodhand, Chris Cramer, Anna
Patterson, Simon Foot, Antonio Giustozzi, Christopher Langton, Michael Murphy, Mark Sedra, Arne
Strand, Emma Hooper, Deniz Kandiyoti, Andrew Pinney, Adam Pain, and Abi Masefield.
Numerous informants, who are included in the appendices to the individual reports, allowed the
study to gain timely and intriguing perspectives on conflict, history politics, economics, culture,
reconstruction and social exclusion. The whole team is indebted, in particular, to the several senior
Afghan government figures, including more than half a dozen Ministers and a dozen members of
the National Assembly, who took the time to speak with us.
I would furthermore like to acknowledge the support and guidance provided by Chris Pycroft,
Shalini Bahuguna, Lu Ecclestone, Alan Whaites, James Fennel, Miguel Laric, Rob Ower and numerous
others from DFID. This significant undertaking, which provides one of the very first opportunities to
draw together expertise from numerous sectors pertaining to Afghanistan’s stabilisation and
development, would not have been possible without their keen interest and commitment.
We also would like to recognise the tremendous efforts of the ‘Understanding Afghanistan’ project
management team, particularly Peter Middlebrook (Team Leader), Sharon Miller (Project
Coordinator), Oliver Mathieson (Project Director) and Robbie Gregorowski (Project Manager), the
latter two from Maxwell Stamp PLC. Peer reviewers such as Astri Suhrke, and Dianna Wuagneux,
Michaela Prokop and Deniz Kandivoti strengthened the content with their insightful critiques.
Finally, I would like to note the role of the Post-war Reconstruction and Development Unit (PRDU)
at the University of York, particularly that of Research Fellow Steven A. Zyck, in supporting the
production of this report. All errors and omissions remain the author’s exclusive responsibility.
Sultan Barakat, Post-war Reconstruction and Development Unit

Author, Synthesis Report & Output 2 Leader, Strategic Conflict Assessment
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Table of Contents
Acknowledgements ..................................................................................................................................... 1
1. Introduction..................................................................................................................................... 8
1.1 Purpose.................................................................................................................................................................... 8
1.2 Key Findings ........................................................................................................................................................... 9
2. Methodology.................................................................................................................................. 12
2.1 The Political Economy Approach ...................................................................................................................12
2.2 Opportunities and Challenges........................................................................................................................12
3. Context and Conflict in Afghanistan .............................................................................................. 14
3.1 The Structural Context .....................................................................................................................................14
3.1.1 Physical Structures.........................................................................................................................14
3.1.2 Human / Social Structures...........................................................................................................15
3.2 The Historical Context ......................................................................................................................................17
3.3 Conflict and Security ........................................................................................................................................18
3.3.1 The Multi-Conflict System...........................................................................................................19
4. Contemporary Conflict in Afghanistan ........................................................................................... 23
4.1 A ‘Theoretical’ Perspective on Conflict in Afghanistan..........................................................................23
4.2 Insurgents and Armed Opposition Groups.................................................................................................23
4.3 Motivating the Insurgency..............................................................................................................................26
4.4 Financing the Insurgency ................................................................................................................................27
5. Governance and the State .............................................................................................................. 29
5.1 The Envisioned State and Underlying Assumptions................................................................................29
5.2 Setting the Stage: The Bonn Agreement ....................................................................................................29
5.3 Territorial Control...............................................................................................................................................30
5.4 Revenue Control and Mobilisation ...............................................................................................................30
5.4.1 Control of Revenues ......................................................................................................................30
5.4.2 Revenue Mobilisation ....................................................................................................................30
5.5 Corruption, Predation and Taxation............................................................................................................. 31
5.6 (De) Mobilising Legitimacy..............................................................................................................................32
6. Economic Development .................................................................................................................. 34
6.1 Economics and Conflict in Afghanistan .....................................................................................................34
6.2 The Economic Context ......................................................................................................................................34
6.3 Constraints to and Opportunities for Growth ..........................................................................................37
6.3.1 Economic Rule of Law...................................................................................................................37
6.3.2 Crime and Insecurity......................................................................................................................39
6.3.3 Infrastructure ...................................................................................................................................39
6.3.3 Opportunities for Growth ............................................................................................................39
6.4 Contextualising the Growth Diagnostic .....................................................................................................40
7. Poverty, Gender and Social Exclusion ............................................................................................. 41
7.1 Poverty, Gender, Social Exclusion and Conflict ........................................................................................ 41
7.2 Poverty................................................................................................................................................................... 41
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7.2.1 Poverty and Access to Public Goods and Services ...............................................................42

7.2.2 Characteristics and Location of the Poor................................................................................42
7.2.3 Efficacy of Recent Interventions ...............................................................................................43
7.2.4 Key Findings......................................................................................................................................44
7.3 Gender ...................................................................................................................................................................44
7.3.1 Women and Security .....................................................................................................................46
7.3.2 State Absence in Female Insecurity ..........................................................................................46
7.3.3 Policies, Institutions and Interventions ...................................................................................47
7.3.4 Opportunities and Constraints ...................................................................................................47
7.3.5 Drivers and Blockers of Change .................................................................................................48
7.4 Other Forms of Social Exclusion....................................................................................................................50
7.4.1 The Disabled......................................................................................................................................50
7.4.2 Female-Headed Households ........................................................................................................ 51
7.4.3 Youth................................................................................................................................................... 51
7.5 Constraints to Social Inclusion ......................................................................................................................52
8. Strategies and Options ................................................................................................................... 53
8.1 The Grand Bargain .............................................................................................................................................53
8.2 Combating Conflict ...........................................................................................................................................53
8.2.1 Utilise Public Diplomacy to Counter Insurgency..................................................................53
8.2.2 Focus Sustained Assistance on ‘Angry, Young Men’ ............................................................54
8.2.3 Minimise Intra-State, Regional Tensions ................................................................................54
8.3 Governance ..........................................................................................................................................................55
8.3.1 (Re) Mobilising Legitimacy...........................................................................................................55
8.3.2 Improve Anti-Corruption Measures..........................................................................................55
8.3.3 Reform the ANA and ANP............................................................................................................56
8.3.4 De-Centralise the State ................................................................................................................56
8.3.5 Increase Revenue Mobilisation and Limit Expenditure ......................................................56
8.4 Economic Development ...................................................................................................................................57
8.4.1 Prioritise the Battle Against Nuisance Taxes and Corruption ..........................................57
8.4.2 Take Early Action to Protect Business from Crime and Insecurity..................................58
8.4.3 Increase Vision, Coherence and Consistency of Policy .......................................................58
8.4.4 Concentrate on Durable Systems, Not Personalities ...........................................................58
8.4.5 Foster Special Economic Zones ..................................................................................................59
8.4.6 Address Infrastructure Weaknesses ..........................................................................................59
8.4.7 Develop Value Chains ....................................................................................................................59
8.4.8 Build Human Capital......................................................................................................................59
8.4.9 Discourage Poppy Eradication ....................................................................................................60
8.5 Poverty Reduction..............................................................................................................................................60
8.6 Gender and Women’s Empowerment .......................................................................................................... 61
8.7 Social Exclusion ..................................................................................................................................................62
8.6 Cross-Cutting Recommendation: Further Research ...............................................................................63
9. Conclusion ..................................................................................................................................... 65
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9.1 Areas of Consensus............................................................................................................................................65

9.2 Points of Contention.........................................................................................................................................65
9.3 Refreshing ‘Understanding Afghanistan’ ...................................................................................................65
Bibliography.............................................................................................................................................. 66
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Table of Figures and Tables

Figure 1. Afghanistan’s Demographic Structure in 2000 ....................................................................................16
Figure 2. The Expanding Security Threat...................................................................................................................20
Figure 3. Annual Increases in Afghanistan’s Opium Production (MT) ............................................................. 21
Figure 4. Location of Key Armed Groups ..................................................................................................................25
Figure 5. Afghan Imports and Exports, 1962-2006...............................................................................................35
Figure 6. Afghanistan’s Informal Economy, by Sector..........................................................................................36
Figure 7. Hausmann, Rodrik and Velasco Growth Diagnostic Framework .....................................................38
Figure 8. Poverty, Level and Extent, by Province ....................................................................................................43
Table 1. Key Phases in Contemporary Afghan Conflict ........................................................................................17

Table 2. The Mounting Security Crisis........................................................................................................................19
Table 3. Drivers and Blockers of Gender Transformation in Afghanistan ......................................................48
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Acronyms and Abbreviations

ACCI Afghan Chamber of Commerce and Industry
AICC Afghan International Chamber of Commerce
AIHRC Afghanistan Independent Human Rights Commission
AISA Afghanistan Investment Support Agency
AMF Afghan Military Force
ANA Afghan National Army
ANAP Afghan National Auxiliary Police
ANCOP Afghan National Civil Order Police
ANDS Afghan National Development Strategy
ANP Afghan National Police
AREU Afghanistan Research and Evaluation Unit
ARTF Afghan Reconstruction Trust Fund
ASOP Afghan Social Outreach Programme
BPHS Basic Package of Health Services
CBO Community-Based Organisation
CDC Community Development Councils
CID Criminal Investigation Department
CNPA Counter Narcotics Police of Afghanistan
CSO Central Statistics Office
DDR Disarmament, Demobilization and Reintegration
DFID Department for International Development
DIAG Disarmament of Illegal Armed Groups
EPAA Export Promotion Agency of Afghanistan
EVAW Elimination of Violence Against Women
FATA Federally Administered Tribal Areas
FCO Foreign and Commonwealth Office
FDDP Focused District Development Programme
FDI Foreign Direct Investment
FHH Female Headed Household
GDP Gross Domestic Product
GECCS Gender Equity Cross Cutting Strategy
HiG Hizb-e Islami (of Gulbuddin Hekmatyar)
HMG Her Majesty’s Government
ICA Investment Climate Assessment (World Bank)
ICT Information and Communication Technology
IDLG Independent Directorate for Local Governance
IMF International Monetary Fund
IMU/T Islamic Movement of Uzbekistan/Turkestan
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ISAF International Security Assistance Force

LOTFA Law and Order Trust Fund for Afghanistan
LTO Large Taxpayer’s Office
MDG Millennium Development Goals
MISFA Microfinance Investment Support Facility for Afghanistan
MoCI Ministry of Commerce and Industry
MoD Ministry of Defence
MoF Ministry of Finance
MoFA Ministry of Foreign Affairs
MoI Ministry of the Interior
MoJ Ministry of Justice
MoLSAMD Ministry of Labour, Social Affairs, Martyrs and the Disabled
MoPH Ministry of Public Health
MoT Ministry of Transport
MoWA Ministry of Women’s Affairs
MRRD Ministry of Rural Rehabilitation and Development
NATO North Atlantic Treaty Organisation
NGO Non-Governmental Organisation
NRVA National Risk and Vulnerability Assessment
NSID National Security, International Relations and Development
NSP National Solidarity Program
NWFP Northwest Frontier Province
OEF Operation Enduring Freedom
PDPA People’s Democratic Party of Afghanistan
PEA Political Economy Analysis
PFM Public Finance Management
PPA Power Purchasing Agreements
PRT Provincial Reconstruction Teams
SSR Security Sector Reform
SWAP Sector Wide Approaches
TTP Tehreek-e Taliban (“Pakistani Taliban”)
UNAMA United Nations Assistance Mission to Afghanistan
UNF United National Front
UNODC United Nations Office on Drugs and Crime
USAID United States Agency for International Development
VET Vocational and Educational Training
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1. Introduction
During the period in which the ‘Understanding Afghanistan’ engagement was ongoing (April to
August 2008), the British military suffered some of its greatest losses, measured in the number of
casualties, within Afghanistan since the start of the international intervention in late 2001. This
fact, accompanied by the tragic loss of scores of Afghan civilians during the same interval,
highlights ever more strongly the need for a holistic understanding of Afghanistan – as a country,
an economy, a polity, a society and a zone of frequent international interventionism– in order to
identify the most effective manner in which to intervene in the cycles of national, regional and
global conflict which have affected it for much of the past 30 years.
The ‘Understanding Afghanistan’ research project consists of four main studies: (i) a Political
Economy Analysis, (ii) a Strategic Conflict Assessment, (iii) a Growth Diagnostic and, (iv) a Poverty,
Gender and Social Exclusion Analysis. Combined, they present one of the few initiatives that have
sought to consolidate information pertaining to contemporary Afghanistan as a whole. Their main
arguments and findings are brought together and streamlined within this report. Given the diversity
of the sectors being explored, the methods employed and the findings arrived at, this document
should be understood not as the sum of its parts but, rather, as a useful tool for analysing the
linkages between the different ‘Understanding Afghanistan’ outputs. References are constantly
made to the component reports, and further details, explanations and findings should be sought
from within them where this document, due to its brevity, is unable to reflect their totality and
depth. Furthermore, it should be noted that, while this report captures a snapshot of Afghanistan at
the time of its writing, the highly dynamic situation will require constant analysis and a continuous
updating of studies such as ‘Understanding Afghanistan’.
This Synthesis Report begins with a brief description, in Section 2, of the methodologies and
conceptual frameworks employed within ‘Understanding Afghanistan’. It then turns, in Section 3, to
a discussion of the contemporary and historical context which have ‘set the stage’ for all
developments and interventions that have taken place in Afghanistan since 2001. This contextual
analysis includes a discussion of the multiple ongoing conflicts in Afghanistan, which are then
further explored – as regards their participants, objectives, motives and financing – in Section 4.
Sections 5 and 6, respectively, review the current statuses of state building and economic
development in order to understand how limited progress in these areas has hindered the pursuit of
stability. Social exclusion and the constraints to inclusion and equity, particularly as related to
women, the chronically poor and the disabled, among others, is the focus of Section 7. Finally, policy
options for improving interventions in each of these sectors – conflict, governance, economic
development and social exclusion – are offered in Section 8 prior to a conclusion in Section 9. In
sum, these various sections review where Afghanistan currently stands and how, after nearly seven
years of external assistance and internal efforts, conflict has intensified, the State has failed to gain
widespread legitimacy, the economy has deteriorated and social exclusion has continued.
1.1 Purpose
The aim of Understanding of Afghanistan is to improve Her Majesty’s Government’s (HMG)
comprehension of the country in order to inform a multi-donor strategy and the
Department for International Development’s (DFID) Country Plan. In doing so, it not only
serves to consolidate information but to provide analysis which correlates to specific short-, mid-
and long-term strategies and policy options integral in operationalising the National Security,
International Relations and Development (NSID) strategy. However, it is important to note that what
results is not a blueprint or instruction manual but a variety of critical insights and policy options
which DFID and HMG should consider and, where appropriate, adopt for inclusion in a broader
government-wide or multi-donor strategy.
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1.2 Key Findings

The following are among the key findings of the various outputs produced during the
‘Understanding Afghanistan’ initiative.
Little progress with security, economic development or social inclusion is likely to be
achieved without the incorporation of the Taliban into the government, a goal which
was unwisely excluded from the December 2001 Bonn Agreement. A more inclusive, post-Bonn
political process is of critical importance, and all components of the international intervention
should focus upon achieving this end. It will be of primary importance to expand the presently
weak constituency for peace and stability within the Afghan government in order to counter
the economic and political interests dependent upon prolonged insecurity That said, the
process of dialogue and, eventually, negotiation over power-sharing should be led by the
Afghan government without external interference. The continuation of divisive rhetoric of the
‘war on terror’ and the labelling of all insurgents as ‘terrorists’ could prevent meaningful
dialogue and should be avoided.
The pursuit of a ‘grand bargain’ would prove unsettling for northern militias, in particular, who
had initially been privileged in the first post-Bonn systems of governance. The perception of a
pro-Pashtun agenda among key governmental officials or the international community would
severely exacerbate tensions created by the current focus of development and security
assistance on southern Afghanistan. All future interventions must take into
consideration rising North-South tensions, the realistic potential for a large-scale civil war
and the need to consistently provide financial incentives and security guarantees to the North
while politically incorporating or courting the Taliban and other predominantly Pashtun
entities.
Contemporary conflict within Afghanistan involves a growing diverse group of fighters

representing several factions and even more numerous interests and motives. The common
perception, however, that all attacks aim to achieve the overthrow of the State is
unfounded, and it appears likely that many insurgent leaders, including those among
the Taliban, see their interests best served by incorporation into the government.
Furthermore, it must be noted that, despite conventional wisdom to the contrary, no evidence
of direct Taliban engagement in poppy cultivation or narcotics trafficking was found.
Each of these groups, however, is fuelled by Afghanistan’s exceptionally pronounced

‘youth bulge’ and the lack of employment opportunities for, in particular, young men.
Targeting employment opportunities and livelihood assistance at this group is critical in order
to dampen insurgent recruitment.
The present-day Afghan State continues to struggle to gain legitimacy as a result of

dependence upon external assistance, high levels of corruption and its minimal control over
both the international military response and the reconstruction and development process. The
challenge of legitimacy is best demonstrated by the government’s limited, meagre ability to
mobilise domestic revenues.
One critical challenge to State sovereignty has been the partial and not entirely
successful incorporation of traditional or customary measures into a modern,
constitutional framework. The failure to do so has resulted in the creation of three parallel
systems, those supported by the Afghan government, those created by the international
community and those that had already existed. Each of these is shaped in various ways by
conflict and international, regional, national and local power struggles. A general conclusion
was reached that in sectors such as justice, security, anti-corruption and service delivery, it is
9
critical to draw upon and unobtrusively develop customary mechanisms rather than
continuing to treat them as corrosive or illicit. Providing a greater role for Islam within the
Afghan State will greatly facilitate cooperation between public and customary institutions, as
the perception of a technocratic and secular government has frequently led to mistrust and
divisions between the periphery and the centre.
Similarly, economic development, while having achieved impressive growth in GDP,

has, primarily, been sustained formally by external support and informally by
narcotics trafficking. Furthermore, growth has been hindered by corruption which detracts
from businesses’ profits and reduces incentives for investment. It is alarming to note that the
number of registered businesses in Afghanistan, having peaked in 2005, is declining rapidly
due to insecurity as well as the opaque and rent-seeking behaviour of public officials. This
situation is troubling given the close relationship between economic growth, revenue
mobilisation (i.e., taxation), governmental legitimacy, political stability, development and
security.
Furthermore, the examinations of economic growth and social exclusion highlight the need to
approach reconstruction and development not only in terms of structural changes and the
creation of enabling environments but also, if not more importantly, in terms of local
development. National growth has, thus far, frequently failed to provide improved living
standards at the local levels from which discontentment has principally emanated.
Agriculture presents, perhaps, the greatest opportunity for providing national

economic growth in terms of GDP while establishing livelihoods and community-
based development. This sector will require continued and expanded donor support which
would be wise to target value chains and the infrastructure, such as roads, cold-storage and
processing and packaging facilities, to support the added-value exportation of produce.
Poverty rates are high, and a large segment of the Afghan population sits alongside
the poverty line. Consumption poverty and food security are perhaps the most notable forms
which poverty takes, though weak service delivery also contributes to poor living standards.
Rising commodity prices and the high reliance upon grain purchases, compounded by
insecurity and a potentially related decline in the overall economy, could push more people
into poverty and malnutrition. Still, more research must be done into the ‘trajectories’ and
qualitative dimensions of poverty given the weakness of current statistical approaches.
The needs and interests of women, in particular, must be more fully addressed within and
beyond the economic sphere. Doing so must recognise the political nature of what are far too
commonly labelled ‘personal’, ‘private’ or ‘social’ concerns of women. Resources and
assistance targeting sectors in which women have a customary or familial role,
particularly health and education, is critical, as is the use of traditional and religious
leaders to begin loosening the cultural association between familial honour (or
religious purity) and the control of women. In some areas, however, such as justice,
safeguarding women’s rights – as well as the rights of other marginalised groups – will require
training and monitoring to ensure the rule of law. The Afghan government and international
community must support equitable justice, access to social services and the amplification of
empowering customary messages while ensuring accountability through consistent
quantitative as well as qualitative monitoring of women’s evolving position.
Violence against women must be understood as a remaining and potentially

increasing challenge, particularly in the context of rising insecurity. The Afghan
government has not taken steps to address this factor, and the international community’s
10
willingness to do so may be blunted by overly broad sentiments that ‘touching’ gender could
inflame additional insurgency. One critical step in tacking this epidemic of violence could be
the engagement of more women in the police and judiciary and the taking of tangible steps to
protect and empower women – not only relying upon the family to provide protection – and to
follow-up conventions and abstract commitments with tangible and closely monitored actions.
Additional socially excluded groups – the chronically poor, female heads of household, the
disabled, youth and others – will, like women, require improved access to basic social services,
to justice, to economic opportunities and to forums for advocating their interests. There is a
genuine need to invest in public goods – such as health, education and justice – in
order to safeguard the interests of those commonly barred, through formal and
informal systems, from accessing such opportunities. Yet, the provision of such goods
must be accompanied by at least minimal social safety nets to assist those who are too
vulnerable to benefit from, for instance, broader economic growth or development
programmes. As with women, the international community would be wise to utilise traditional
mechanisms, such as charitable giving (or zakat), particularly in those cases where
marginalisation is not based on identity, to guarantee sustainability and local ownership.
Finally, on an overarching programmatic level, three core components must be considered.

First, the tendency to focus upon wide and quick impacts must be replaced by attention to the
quality of interventions. Second, sustainability must be made a greater priority, both in
fiscal and in programmatic terms. Third, a genuine model of collaborative governance
whereby civil society, local communities, sub-national public structures and the international
community cooperate, under the overall guidance of the Afghan government, to build
consensus regarding the needs of the Afghan people and the most effective manners in which
to reach them, is required.
These findings and many others are explored in further detail within the following sections and, far
more elaborately, in the reports which have contributed to them. The overall picture is one of a
weak State which has lost legitimacy just as the insurgency has expanded and also claimed, if not
yet won, the moral high ground. The country’s future will depend upon the government’s ability to
gain capacity, legitimacy and autonomy and to rid itself of the corruption which has not only
weakened the State but severely hindered the economy. The international community has
contributed to such problems through specific policies and practices and, more broadly, through its
willingness to establish parallel structures and to deprive the government of the rights and
responsibilities of an independent State, despite the stated intention to do quite the opposite.
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2. Methodology
The various ‘Understanding Afghanistan’ outputs utilised differing but complementary
research methodologies, both quantitative and qualitative. In addition, conceptual
frameworks, reflective of their individual undertakings and subject areas, guided the development of
each output. These are encapsulated in the methodology papers designed by each output team in
advance of the field research. For its theoretical grounding, the Political Economy Analysis drew
upon a tri-partite rubric of capital, coercion and legitimacy and the notion of a ‘triple transition’ in
order to better understand the historical and contemporary processes of state building in
Afghanistan. The Strategic Conflict Assessment drew heavily upon DFID’s own Conflict Assessment
Guidance Notes in examining the varied roles of structures, actors and dynamics in the conflict and
the manners in which they were (and could be) affected by the international intervention. The
Growth Diagnostic, in recognition of the lack of conflict-adapted economic assessment tools,
employed the framework developed by Hausmann, Rodrik and Velasco (2005), but then, in a
separate and complementary report, analysed the results in the light of Afghanistan’s political
economy and conflict. Finally, the Poverty, Growth and Social Exclusion Analysis drew upon a variety
of qualitative and quantitative methods and the results of the 2005 and 2007 National Risk and
Vulnerability Assessments (NRVAs).
Within each ‘Understanding Afghanistan’ output, a standard process was followed in
reaching the final conclusions and reports. This began with the development of individual
methodologies to ensure rigor, followed by sector-specific literature reviews to highlight the gaps in
knowledge and analysis. Each output team then undertook significant amounts of field-based
research prior to drafting Initial Findings Papers, which were then developed in consultation with
DFID counterparts. The consultation phase not only allowed the output teams to better understand
HMG’s perspectives but also provided an opportunity for team members to identify and develop the
linkages between their findings and streams of analysis. Such connections are evident within this
Synthesis Report and within each of the individual output reports. Finally, peer reviewers, who
brought additional expertise and a refreshing degree of detached objectivity to the findings,
reviewed all outputs, including the final reports. This process allowed for thorough research and
analysis and was guided by the overarching conceptual framework described below.
2.1 The Political Economy Approach

In the interest of linking up the findings, the team members determined that a political economy
approach to the analysis was both most applicable to the task and most relevant to the Afghan
context. Political economy maintains that the economy – the structure of production,
patterns of economic activity, transactions and policies – cannot be understood simply as
an outcome of economic laws but also as influenced by and inseparable from political
interests, the organisation and balance of power and social relationships.
Understanding conflict, for instance, entails an understanding of whose interests – political,
economic, social, ideological or otherwise – are served by its initiation and continuation. Another
example emerging from the Poverty, Gender and Social Exclusion Analysis would be that women’s
participation in the wage-earning labour force is not simply a function of economic logic but also
of power relations and historically established (and perhaps changing) norms and ideologies. In
addition, several reports demonstrated that governance in Afghanistan is not solely determined by
technical arrangements and capacities but also by the economic structure and the manner in which
vested local and international interests are served (or not) by various manifestations of
governmental authority.
2.2 Opportunities and Challenges

The various methodologies were well suited for the individual outputs and for their consolidation
12
into the overarching project. Most significant, however, was not the technical approach and
analytical frameworks but the potential to engage in substantial amounts of field research within
Afghanistan (and, in the case of the Strategic Conflict Assessment team, Pakistan). In sum, more
than 140 person-days were spent conducting field research primarily in Kabul, though
Strategic Conflict Assessment team members were able to conduct more than 15 days of research in
Kandahar, Helmand and Herat provinces in addition to several days in Pakistan.
‘Understanding Afghanistan’ team members, facilitated by DFID Kabul, were able to interview high-
ranking Afghan officials, members of the National Assembly, foreign and Afghan soldiers and
military commanders, Afghan police officers, international police trainers, experts, advisers,
consultants and countless representatives of international, intergovernmental, financial and non-
governmental organisations (NGOs) in addition to, in the UK, several Members of Parliament.1 These
individuals provided insights and information which is not publicly available and served to highlight
as well as challenge critical assumptions regarding politics, conflict, economics, reconstruction and
social equity within Afghanistan.
The research was not, however, without minor complications. Security concerns and the limited
amount of time (one month) for field research posed anticipated constraints. However, the most
notable challenge, evident across all outputs, was the lack of historical as well as contemporary data
concerning Afghanistan. Several reports note that, despite the wealth of information gathered
regarding various sectors, the data remains diffuse, decentralised and, in many cases, unpublished.
The lack of data concerning gender and social exclusion, in particular, is noted by the Poverty,
Gender and Social Exclusion Analysis as resulting from the sensitivity of data related to women,
ethnicity and marginalised groups. 2 This lack of data complicated, in particular, the degree of
certainty which could be claimed by the results of the Growth Diagnostic, and, more broadly, data
paucity will continue to inhibit evidence-based policy development and programming. One of the
key recommendations emerging from this study is for DFID to take the lead in gathering
and centralising data related to security, reconstruction, economic growth, governance
and social exclusion.
1 Full lists of informants can be found in the appendices of each ‘Understanding Afghanistan’ report. In many cases,
informants requested to remain anonymous. In such cases, efforts have been made to identify the role or placement of such
individuals if not necessarily their title.
2 Additional information regarding data availability, or the lack thereof, can be found in Section 7 of the Political Economy
Analysis final report, in Sections 2 and 3 of the Growth Diagnostic Scoping Study final report and in Section 1.4 of the
Social Exclusion final report.
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3. Context and Conflict in Afghanistan

The Afghan context and the key structures that comprise it provide a crucial backdrop for all other
points addressed within ‘Understanding Afghanistan’, from conflict to politics, economics and
exclusion. As such, understanding what that context is and how its present formulation has been
shaped by history is critical. This section analyses those physical and human structures – such
as geography and culture – which comprise this context before turning to an exploration
of Afghanistan’s history and the patterns evident therein. Finally, it concludes by describing
the troubling contemporary security situation and by identifying the multiple conflicts which have
conspired to create it.
3.1 The Structural Context

By ‘structures’, this report means those relatively consistent (in temporal terms) features of a
country or society that shape and direct the economic, political, social, security-related and other
events and developments. Numerous structures were explicitly or implicitly referenced by the
team, including: Geography, Location (including Trading Position), Natural Resources, Demographics,
Centre-Periphery Relations, Corruption and Opportunism, Intra-State Regionalism, Inter-State
Regionalism, Gender, Poverty, Exclusion, Ethnicity, Culture, Religion, Security, the War on Terror and
Western Liberalism. The most significant and recurring structures are further examined below. 3
3.1.1 Physical Structures

3.1.1.1 Geography and Location
Afghanistan’s physical geography has provided both constraints and opportunities for governance,
state building, economic development and security. Afghanistan is located on a pivotal trade
crossroads which links Central and Southern Asia. The Afghan government is eager to regain
the country’s historic role as the major trade route (‘silk road’) or ‘economic land-bridge’
connecting the Middle East, South Asia, and Central Asia (Islamic Republic of Afghanistan, 2008). 4
However, the inaccessibility of the country’s terrain and its land-locked position present particular
challenges. Landlocked status brings constraints to economic development such as
detrimental transit costs, reliance on the transit infrastructure and the regulatory challenges of
cross-border commerce that are not experienced by coastal countries.5 The mountainous terrain has,
furthermore, made it difficult for governmental authority to extend into isolated rural communities
and has, historically, provided a strategic advantage against foreign armies in conflict.
Conversely, Afghanistan’s position as a regional centrepiece and its extensive borders has also
proven problematic. The country shares a total of 5,529 km of borders with Pakistan, Iran,
Turkmenistan, Uzbekistan, Tajikistan and China. Being relatively porous, these borders have
allowed smugglers and illegal armed groups to operate with relative impunity.
3.1.1.2 Natural Resource Endowment

Afghanistan has abundant natural resources including natural gas, oil, coal, copper, uranium, gold,
silver, chromate, talc, barites, sulphur, lead, zinc, iron ore, salt and precious and semiprecious stones
3Structures are discussed throughout each of the ‘Understanding Afghanistan’ reports but can be found, most notably, in
Section 3 of the Political Economy Analysis, Section 3.1 of the Strategic Conflict Assessment and Section 2 of the Growth
Diagnostic Policy Discussion Paper.
4 It has suggested that the Trans-Afghan Pipeline (TAP) would allow the country to serve as a conduit for Central Asian gas
to growing energy markets in Pakistan and India, however, the commercial viability of the project are questionable due to
security concerns, poor and unpredictable Pakistani-Indian cooperation and reliability of gas supply from Turkmenistan.
5A key study of trade in the wider region surrounding Afghanistan has flagged up significant costs of being land-locked for
this region (Byrd & Raiser et al., 2006).
14
(Afghanistan Geological Survey, 2007).6 Major mineral reserves are largely untapped, and
much existing mining is illicit. A substantial semi-precious stone industry exists in Afghanistan
but is largely informal with stones passing into Pakistan for cutting and polishing (World Bank,
2004). As such, the recorded activity from such natural resources contributed less than one per cent
of GDP in 2006.7
However, there are predictions that the contribution of minerals, if brought into the formal, licit
economy, to GDP and to government revenues could increase dramatically (ibid). Oil and gas
reserves, which may also be far greater than previously thought, could do the same. The US
Geological Survey estimates that two northern regions could contain up to 1.6 billion
barrels of oil and 15.7 trillion cubic feet of natural gas. Yet, as research has consistently
reflected, primary export commodities may sustain (if not, necessarily, ignite) conflict (Collier &
Hoeffler, 2002). The mining and trade of gemstones, such as Panjshiri emeralds, for example, was
widely reported as a source of income for the Northern Alliance.
Agricultural resources are also a critical component of the context, including of the
conflict dynamics, as they provide both substantial levels of employment (up to 70 per
cent) and more than 90 per cent of the world’s opium and heroin. Both facts may seem to be
counter-intuitive given that only between 10 and 14 per cent of Afghanistan is comprised of arable
land, only a third to half of which has any access to irrigation. Yet, as later sections will discuss,
agriculture may pose one of the greatest possibilities for economic growth if adequate
infrastructure is put in place to connect Afghanistan with wider markets.
3.1.2 Human / Social Structures

3.1.2.1 Demographics
Afghanistan’s population remains unknown given the absence of a census, though best estimates
place the number between 22.1 and 31.0 million (AREU Research Newsletter, 2007). Predominantly a
rural population, Afghans have long resisted urbanisation. However, since the mid-1990s, urban
centres have experienced rising populations (with Kabul averaging 15 per cent annual growth) due
to internal migration, influxes of returnees and natural population growth. In 2004, Kabul’s
population was estimated at 3 million, though growth rates predict that, at present, it is closer to
3.6 million (World Bank, 2005).
The median age in Afghanistan is estimated at only 15, compared to 20.1 in Nepal, 20.3 in Pakistan,
23.4 in Iran and 23.8 in India (CSO/UNFPA, 2006: 25-26). The population exhibits a classic
‘youth bulge’, showing a large number of children, a rapid rate of population growth and
a lower proportion of older individuals (see Figure 1). The presence of a growing, young
population, if not accompanied by expanding and licit economic opportunities, may
contribute to insecurity. This point is discussed further within Section 6 of this report and, in
particular, within the Political Economy Analysis, Strategic Conflict Assessment and Growth
Diagnostic.
6 Afghanistan Geological Survey, 2007

7By November 2007, Afghanistan announced the State-owned China Metallurgical Group won the rights to exploit the
Aynak copper field in Logar Province, south of Kabul. This investment is likely to generate significant revenues.
15
Figure 1. Afghanistan’s Demographic Structure in 2000
Source: Population Action International (2003)
3.1.2.2 Culture and Ethnicity

Afghan society, given the predominantly rural population, has long been dominated by adherence to
the qawm, or community. This community, with which would-be rulers frequently conflicted, is
principally a local, social entity but extends more broadly to encompass family, tribe and other
forms of social identification. The sense of community is considered strongest among Pashtun
Afghans, situated predominantly in the South and East with substantial overlap into Pakistani
border provinces. Pashtuns are estimated to include 44 per cent of the Afghan population. Other
ethnic groups include Tajiks (25 per cent), Hazara (10 per cent), Uzbeks (8 per cent) and others,
including Aimaqs and Turkmens (a combined 13 per cent). Many of Afghanistan’s warlords have
maintained mono-ethnic militias, though they have frequently come together in the face of a
common enemy, as was demonstrated in the anti-Soviet jihad.
Conflict has not only brought Afghans together but has, most notably, driven them apart.
During the Soviet era, in particular, traditional leaders, Khans and Maleks, were either co-opted or
killed. Local jirgas, traditional decision making councils, remained in existence but had been tainted
by the concept’s adoption by the Soviets and by subsequent regimes. In addition, the
‘Kalashnikovisation’ of Afghan culture, a result of the estimated US$6 billion in weapons provided
by the US, Saudi Arabia, Pakistan and China to the Mujahidin, has brought about an increase in
crime, violence, atomisation and community isolation.
3.1.2.3 Religion
In addition to ethnicity, Islam, according to its local and fluid interpretations, is a powerful
force though neither strictly fundamentalist nor completely stable in its interpretation
and application. Yet, it is considered a sacred and inviolable part of life. However, it is important to
note that, unlike the ongoing war in Iraq, sectarian divisions between Sunni and Shia Muslims have
not been a defining feature of conflict within Afghanistan, largely given the country’s
predominantly (80 per cent) Sunni composition.8 Islam has taken four major paths in Afghanistan.
8 Almost the entirety of the remaining 20 per cent are Shia.
16
The first is ‘traditional Islam’, which includes local folklore and is identified with the Sufi orders. The
second, ‘revivalist Islam’, includes Deobandis, Salafis, Tablighis and other groups. The remaining two
are notable for their relation to the State. ‘Pro-government Islam’ is comprised of clerics, generally
on the public payroll, who extol the virtues of the government and its policies, while ‘political Islam’,
as pursued by groups such as Hizb-e Islami and Jamiat-e Islami, seeks the incorporation of Islam (in
varying degrees and forms) into the State and governmental entities. 9
3.2 The Historical Context

Numerous histories of Afghanistan exist, and summaries and reviews of the historical literature are
available in the Political Economy Analysis final report and the Strategic Conflict Assessment
literature review. This section aims not to chart Afghan history but to analyse common trends
relevant to the contemporary situation and to address why Afghanistan has repeatedly proven such
a challenging context for would-be state builders.
Five central constraints have hindered effective state building in, at least, the past
century.10 First, a Western-style government has consistently been pursued through administrative
and technical processes without first having resolved external opposition among those stakeholders
who possess the means – generally violent means – to swamp state building efforts. ‘Elite pacts’
that involve only a portion of the necessary stakeholders have consistently been sought to the
detriment of more broadly inclusive ‘grand bargains’.
Second, governing coalitions, once created, have repeatedly proven unwilling to compromise on
their goals and interests, thus leading to the collapse of the coalitions and the devolution of
political conflict into violence. Third, an overdependence on foreign patrons, whether British, Soviet,
American or Pakistani, has privileged external (rather than internal) interests, has reduced the need
to mobilise local revenues (primarily through taxation) and, in the process, has blocked the
development of a ‘social contract’ whereby revenues are extracted in exchange for services and
protection.
Fourth, reforms pursued by elites in Kabul have repeatedly been perceived as culturally or
ideologically threatening to wide swaths of the population, including relatively ‘traditional’ ethnic,
community or religious leaders. Fifth and finally, the focus upon state building and governmental
expansion in the immediate post-conflict phase has rendered it unnecessarily complex and less
likely to succeed. While conflicts often result in and open the door for broad, national changes, they
also force the re-negotiation of forms and distributions of power and authority at lower levels.
Attempting to build a state within a context of countless small-scale power tussles has burdened
and ultimately undermined the process in several instances.
Table 1. Key Phases in Contemporary Afghan Conflict
1979 - 1988: Jihad in a Cold War Context

The Afghan rural resistance fought the Soviet-backed Kabul regime. The Sunni (i.e., Pashtun,
Tajik, Uzbek) resistance parties received military and financial support from Pakistan, the United
States11, Saudi Arabia and China. The Kabul regime received similar backing from the Soviet
Union. More than 5 million Afghans became refugees in Iran and Pakistan. The Geneva
agreements of 1988 paved the way for Soviet withdrawal.
9 Roy (2001) Islamic Radicalism in Afghanistan and Pakistan (Geneva: UNHCR); Dorronsoro (2000) Pakistan and the Taliban:
state policy, religious networks and political connections (Paris: CERI).

10 More details can be found in the Political Economy Analysis of ‘Understanding Afghanistan’.
11 It is estimated that US$6-8 billion worth of arms were sent through the Afghan arms pipeline (Rubin, 1995).
17
1989 - 1992: Jihad among Afghans

After the Soviet withdrawal an internal war between the Soviet-supported government of
President Najibullah and the various Afghan factions ensued, with rapidly dwindling support
from the Soviet Union and the US. The Najibullah regime collapsed when Abdul Rashid Dostum,
commander of an Uzbek militia aligned to the Kabul regime, switched sides to the Mujahidin,
who entered the capital in April 1992.
1993 - 1996: Factional War Among Afghans
As superpower influence declined, regional power interests reasserted themselves and the
conflict assumed the characteristics of both a regional proxy war and a civil war. In late 1994
the Taliban began to emerge, first in Kandahar in the South, with a stated objective of restoring
stability. In September 1996 they entered Kabul. 12
1996 -2001: Taliban Rule
Fighting continued between the primarily Pashtun Taliban, backed by Pakistan, and the primarily
non-Pashtun United Front (UF; also known as the Northern Alliance)13, backed by Iran, Russia,
Uzbekistan and Tajikistan. The Taliban controlled roughly 90 per cent of the territory, and the UF
the remaining pockets.14 The presence of radical Islamic groups in Taliban-controlled territory
(and in neighbouring countries) including Osama Bin Laden’s al-Qaeda network and the Islamic
Movement of Uzbekistan (IMU; now the Islamic Movement of Turkmenistan) contributed to
growing international concern and ultimately a re-engagement with the region.15
3.3 Conflict and Security

The question, thus, remains to what degree these historical patterns apply to contemporary
Afghanistan. As is evident in the rising trend of violence and insecurity (see Table 2,
below), the cycle has been repeated and, indeed, has led to several overlapping conflicts
(or sub-conflicts).
As of mid-July 2008, 153 international troops have died this year in Afghanistan not to mention the
ever-increasing civilian toll of both, insurgency attacks and the international military response. May
and June 2008 have been the first months during the ongoing Afghan conflict that have
claimed the lives of more international military personnel than in the present war in Iraq.
It is, thus, necessary to understand the various conflicts that have contributed to this escalation.
These statistics reflect a situation which is becoming less secure and an ‘insurgency’ that has
become more active and proficient.
12 See Maley, (1998) for an analysis of their rise to power.

13 The United National Islamic Front for the Salvation of Afghanistan (Jabha-yi Muttahid-I Islami-yi milli barayi Nijat-I
Afghanistan). The UF was formed in 1996 as an alliance of the groups opposed to the Taliban. The president of the ousted
government, Burhanuddin Rabbani, remained the President of Afghanistan the titular head of the UF, although real power
lay with Commander Ahmad Shah Massoud, the Minister for Defence (Human Rights Watch, 2001:12).
14 Principally in the north, northeast and parts of the central highlands.
15In August 1998 US air strikes on Bin Laden’s camps in Afghanistan followed the US embassy bombings in Tanzania and
Kenya. International sanctions were subsequently imposed in 1999 and 2000.
18
Table 2. The Mounting Security Crisis
2002 2003 2004 2005 2006 2007

Attacks targeting civilians16 - - - 491 969 1,127
Percentage of ‘Successful’17 Attacks - - - 74.5 71.7 79.1
Civilian Deaths per ‘Successful’ Attack - - - 4.2 5.1 5.2
IED Attacks18 22 83 - 783 1,730 1,314
Suicide Bombings19 0 2 3 17 123 137
Afghan Civilians Harmed by Such Attacks 20 - - - 1,540 3,557 4,673
Coalition Military Fatalities21 68 57 58 130 191 232
3.3.1 The Multi-Conflict System

The ongoing ‘conflict’ in Afghanistan emerges from a combination of several inter-related sub-
conflicts. It is neither a singular conflict nor a phenomenon of anti- versus pro-
government elements. The various components of this multi-conflict system are described below.
3.3.1.1 The Insurgency

The conflict between the ‘insurgency’ and the government (and its international supporters) is
perceived to be the most significant. However, the insurgency itself is comprised of a number
of armed opposition groups with differing motives. The Taliban, now frequently labelled the
neo-Taliban in light of its ongoing evolution, is comprised of members seeking a return to near-
absolute power while others pursue a strong bargaining position from which to enter and formally
participate in governmental institutions. Newer Taliban recruits are reportedly seeking income or
attempting to express frustration with the lack of anticipated progress since 2001, while many
others are far more fundamentalist, in religious terms, and identify most closely with al-Qaeda. It is,
however, important to understand that much of what is commonly perceived as the
Taliban or ‘the insurgency’ is, in fact, a federation of smaller entities including Hizb-e
Islami, the Haqqani Network and numerous Pakistani groups (Lashkar-e Taiba, Tehreek-e
Taliban/the Pakistani Taliban). The specific goals and interests of such groups are discussed in
Section 4 of this report and are elaborated within the Strategic Conflict Assessment final report.
16 Anthony Cordesman (2008) The Afghan-Pakistan War: A Status Update (Washington, DC: Centre for Strategic and
International Studies), p. 24. Data included within the next two rows is provided within the same document or is
extrapolated from statistics provided therein.
17‘Successful’ attacks are those which resulted in casualties. Attacks in which the bomb did not detonate or in which it
detonated accidentally and with no human impact are deemed to have been unsuccessful.
18 Numbers have been consolidated from a number of sources, including: US House of Representatives Committee on
Foreign Affairs (2007) Afghanistan 2007: Problems, Opportunities and Possible Solutions. Available at:
http://foreignaffairs.house.gov/110/ber021507.htm; and Afghanistan Conflict Monitor (2008) Security Incidents. Available
at: http://www.afghanconflictmonitor.org/incidents.html. The decline in 2007 is commonly credited to the enhanced
interdiction ability of Coalition and Afghan military and security services.
19 UNAMA (2007) Suicide Bombings in Afghanistan (Kabul: UNAMA), Sept.
20 Cordesman (2008) The Afghan-Pakistan War: A Status Update.
21 Afghan Conflict Monitor (2008) Military Casualty Data. Available at: http://www.afghanconflictmonitor.org.
19
Figure 2. The Expanding Security Threat
3.3.1.2 Narco-Conflict
For all of the attention provided to the role of narcotics in conflict, this may perhaps be the least
significant and the least violent (or potentially violent). A conflict exists insofar as those engaged in
the cultivation, processing and trafficking of opium poppies (i) pay ‘taxes’ to insurgent groups
which, in return, provide them with protection and freedom to operate and (ii) engage in skirmishes
during eradication or interdiction operations. Parallels to Colombia, where the rebel
organisations themselves operated the drug trade, are unsubstantiated, and no evidence
of direct Taliban involvement in the narcotics trade was found. It is widely perceived that
those who attempt to equate security and poppy eradication are attempting to provide a rationale
for the latter while paying little heed to the former.
20
Figure 3. Annual Increases in Afghanistan’s Opium Production (MT)
Source: UNODC (2007)
3.3.1.3 International / Regional Conflict

Regional conflicts have had a significant impact upon Afghanistan. Often viewed in the context of
Iran to the West, the highly paranoid Turkmen, Tajik and Uzbek regimes to the North and Pakistan to
the East, the situation has frequently been described as a ‘regional conflict system’. However, despite
the admitted relevance of each of Afghanistan’s six neighbours, Pakistan is by far the most
influential.22 Pakistan’s inability to control its lengthy border with Afghanistan and the
likelihood that Pakistani intelligence agents have continued to support various insurgent
groups both pose fundamental security dilemmas for Afghanistan. Fears continue to exist,
however, that emboldened international military action against militants in the Northwest Frontier
Province (NWFP), the Federally Administered Tribal Areas (FATA), Waziristan and Baluchistan could
destabilise Pakistan and lead to a domino effect involving, at least, Kashmir and India.
3.3.1.4 North-South Competition

Regional tensions between the North and the South, or non-Pashtuns and Pashtuns, emerged as a
currently non-violent but highly plausible conflict. North-South tensions and animosity
lingering from the anti-Taliban resistance led by the United Front/Northern Alliance were
transposed onto the Interim Administration and subsequent government as northern
commanders claimed key governmental posts. President Hamid Karzai at first came to be seen
as a Pashtun face for an anti-Pashtun agenda. However, the dynamic changed with the more recent
transfer of leading cabinet posts from Tajiks to Pashtuns (the ‘de-northernisation’ of the
government), which convinced many in the North that a Pashtun agenda had overtaken the State.
The simultaneous resurgence of the Taliban and other Taliban-allied insurgent groups, which came
to be derisively regarded as ‘Karzai’s Taliban’ by many in the North, compounded this situation.
Currently, the distribution of international assistance and all actions within the security
sector are being interpreted according to a North-South lens, and many fear that the
22It is necessary to highlight the potential role of Iran, in particular, in Afghan politics. While there currently appears to be
no credible evidence of Iranian involvement in the Afghan conflict, any political or military action against Iran could allow
the regime in Teheran to, at least, allow non-governmental agents to send weapons and fighters across the border into
Afghanistan. (Current accusations of Iranian weapons being used by the Afghan insurgency appear unfounded. Weapons
recovered may have been purchased on the Iranian black market at an earlier date, are frequently imitations of Iranian
weapons and were almost certainly not provided by the Iranian government
21
expansion of the insurgency to northern Afghanistan could draw resistance and provide a
catalyst for a large-scale civil war. The formation of the United National Front (UNF)23, a
political party representing members of the United Front which many see as a defensive alliance
amongst northerners, in 2007 is both a manifestation of Afghanistan’s unstable coalition politics
and the country’s growing North-South bifurcation.
3.3.1.5 Local, Power-Sharing Conflicts

Largely disconnected from the broader insurgency are localised conflicts involving communities and
‘strongmen’. According to some informants, up to 70 per cent of the violence in the South
and 50 per cent nationwide can be attributed to local disputes ‘outsourced’ to insurgent
groups, claimed by insurgents or falsely attributed to the Taliban rather than veritable,
anti-State insurgent activity.24 At the root of this violence are the grievances of some
communities or social groups over perceptions of exclusion from the district or provincial public
administrations. For instance, in Kandahar, the Noorzai tribe perceives itself as being virtually
excluded from government offices, which are seen to be monopolised by rivals, and feels
marginalized by the government. As a response this tribe’s members have frequently affiliated
themselves with the Taliban and, subsequently, attacked government targets not because they wish
to destabilise the State as a whole but in order to press their own equitable access to public
resources and positions.
3.3.1.6 Interpersonal Violence

Despite a tendency to assume that interpersonal violence, particularly that which affects women
and marginalised groups, is politically irrelevant, the report of the Poverty, Gender and Social
Exclusion Analysis shows that it is. The Taliban has routinely used violations of women’s
‘honour’ by international agents – such as showing foreign troops searching Muslim
women – to boost recruitment figures. Furthermore, in addition to its fundamental immorality,
violence against women and marginalised groups reduces social cohesion and economic
productivity. It may, in fact, signify the displacement of men’s growing dissatisfaction with the post-
conflict context.
As this section portrays, Afghanistan provides historical, cultural and geographical limitations upon
state building in addition to a wide range of ongoing and simmering conflicts. The challenge thus
remains to better understand how the pursuit of political power can be de-coupled from its near-
constant association with violence.
23 Members include Mustafa Zahir (grandson of former king Zahir Shah), ex defence minister Mhd Qasim Fahim,
parliamentary speader Yunus Qanooni, vice President Ahmad Zia Massoud and former general Abdul Rashid Dostam. The
UNF claims to be backed by 40 per cent of parliament.
24Personal communication, UNAMA personnel, Kabul, Afghanistan, April 2008. In such cases, tribal ‘strongmen’ frustrated
with their lack of control over the local, district or provincial administration may temporarily ally themselves with an
insurgent group, such as the Taliban, in order to gain support for an attack. Alternatively, such ‘strongmen’ may attack
independently and allow the attack to be attributed to or claimed by the Taliban in order to avoid responsibility or
retribution.
22
4. Contemporary Conflict in Afghanistan

Given the wide variety of conflicts taking place (or potentially taking place) in Afghanistan, a
discussion of the broader political economy is daunting. Indeed, there is no single political
economy but rather a variety of micro-political economies which fuel its incitement and
continuation. These are provided, in the scope of ‘Understanding Afghanistan’ within the Political
Economy Analysis and Strategic Conflict Assessment. These two reports provide complementary
perspectives on the same phenomenon, the first focused upon the theories and underlying
vulnerabilities with the second on the nexus of agents and causes which drive it at global, national
and societal (or individual) levels. Combined, they provide a comprehensive portrait of how state
weakness, poor governance, deprivation, financing and culturally-rooted expectations and
perceptions generate conflict and impel individuals to participate in armed groups.
4.1 A ‘Theoretical’ Perspective on Conflict in Afghanistan

Afghanistan represents a profoundly unstable political economy due to four primary factors. First,
Afghan statehood has been shaped by the interests and state-building strategies of
Western and regional powers. The lack of a nationally owned approach and the constraints
placed on the actions of Afghan political figures by their international backers has impeded the
sorts of negotiation and political accommodation which commonly leads to conflict resolution.
Second, Afghanistan is situated in a highly volatile and complex region which has injected
countless stakeholders with numerous agendas into conflicts. Many of these actors, primarily
Pakistan but also potentially Iran and Uzbekistan, have sought their own national interests through
involvement (either active or passive) in Afghanistan and in their border regions. Third, the heavy
degree of international financial support has made successive governments de-prioritise
the interests and ideologies of their citizens in order to maintain continued access to external
assistance. Doing so had led to widespread discontent with their government among Afghans and,
at times, impelled their participation in conflict to topple it. Fourth, the succession of conflicts
in Afghanistan has created a self-perpetuating cycle. Economies become oriented and in many
ways dependent upon conflict, and local leaders at all levels become accustomed to high levels of
autonomy and access to social and financial capital. The termination of conflict or establishment of
stable governmental institutions would jeopardise these gains, thus compelling them to undermine
security.
These same patterns, as will be discussed in the following sub-sections, were validated by the
Strategic Conflict Assessment, which explored the actors involved in Afghanistan’s conflicts and
their interests. Yet, potentially the most profound implication of both the theory and the
on-the-ground reality is that peace has few genuine proponents in positions of leadership.
Regional leaders prefer to keep international and Afghan security services bogged down in
Afghanistan and their national insurgents and terrorists occupied outside of or at the fringes of
their countries. Afghan political elites, who often benefit from the war economy more than those in
the provinces and villages (i.e., through involvement in narcotics and private security companies),
have a vested stake in its continuation at a limited level of intensity (which does not threaten to
topple the government or upset their financial interests). Local Afghan leaders, particularly those
unaffiliated with the government, rely on continued conflict in order to enhance their autonomy,
authority and illicit income. The only apparent losers in Afghanistan’s conflict are those
devoid of authority, who suffer the brunt of violence, and the international actors who
repeatedly fail to grasp that many of their allies remain, at best, ambivalent towards their
goals and interests.
4.2 Insurgents and Armed Opposition Groups

While it is important to note that allies may not share HMG’s or the broader international
community’s goals in Afghanistan, it is also critical to understand that not all insurgents necessarily
23
oppose the achievement of a stable Afghanistan. Despite the common but misleading use of
the term ‘anti-government elements’ to describe the insurgency, many actors involved in
the contemporary conflict are not attempting to overthrow the State but instead to achieve
autonomy, to earn pride or income or to bolster their negotiating position vis-à-vis the government.
The Taliban – The most significant part of the insurgency remains the Taliban.25 Informed
estimates put its maximum current size at 20,000 members (others closer to 10,000 or 15,000
members) with only a minority being full-time fighters. While many of its original members and
recent recruits are motivated by a fundamentalist Islamic ideology which compels them to impose a
radical interpretation of Sharia law, many newer members have joined out of more traditional
Mujahidin motives of expelling an occupying army and a discredited government (to so-called
‘Mujahidin-isation’ of the Taliban). Relatively unexpectedly, a rising number of recent Taliban
recruits have adopted the global jihadist perspective of al-Qaeda and have become more radical
than the Taliban’s clerical leadership. Still, UN officials in Kabul report that many Taliban elements,
including, potentially, Mullah Mohammed Omar, sustain the ‘insurgency’ as a means of improving
their bargaining power in advance of an anticipated negotiation process or power-sharing
arrangement.26
Hizb-e Islami – The second most significant insurgent group is Gulbuddin Hekmatyar’s Hizb-e
Islami. While Hekmatyar and his affiliates are officially barred from politics, individuals affiliated
with the Hizb-e Islami political faction, created in 2005 and officially not associated with
Hekmatyar, are active in the Afghan National Assembly in Kabul. 27 Hekmatyar’s dual political and
military approach has provided him with a strong hand in either stability or conflict. Concerns have
recently developed, however, that he has begun re-mobilising his fighters on a broad scale.
Recruitment among university students, a traditional Hizb-e Islami base of support, in northern
Afghanistan has increased. Informed individuals currently estimate that, while far from flexing its
full muscle and from giving up on the political system, Hekmatyar’s faction may account for up to a
quarter of all active insurgents (up from approximately 10 per cent in 2006).
Jamiat-e Islami – There are also signs that ideological fringe of Jamiat-e Islami, the largest of the
Mujahidin groups, are turning to armed opposition to the sitting governmental administration,
particularly in the West (Herat and Ghor provinces) but also in the northeast. This mobilisation,
being small and isolated rather than coordinated, has not had much military impact but contributes
to the spread of insecurity and facilitates the efforts of the Taliban to establish supply lines reaching
to the northern and western borders.
Haqqani Network – Jalaluddin Haqqani, like Jamiat-e Islami, fought with his so-called ‘Haqqani
Network’ for the Mujahidin. The Haqqani Network, which is widely credited with the bombing of the
Serena Hotel in Kabul in January 2008, now commands not only its own fighters but, due to its past
tactical success, has been put in charge of Taliban field operations in, at least, Waziristan.
(Unconfirmed reports say that Jalaluddin Haqqani may be the Taliban’s chief tactician and military
commander.)
Pakistani Insurgents – The so-called Pakistani Taliban, Tehreek-e-Taliban (TTP), led by Baitullah
Mehsud, is believed to have close links to al-Qaeda but seems careful to give allegiance to Mullah
Omar and the Afghan Taliban. In February 2008, TTP members kidnapped the Pakistani ambassador
25 Commentators such as Bearden and Gerges Fawaz who are familiar with the Taliban often note that, despite the constraints
imposed by its current outlaw position, seems to be far less well funded than prior to 2002.
26 Personal communication, UN officials, Kabul, Afghanistan, April/May 2008.
27Some such individuals have, in order to qualify for public office, been forced to sever ties with Hekmatyar. Such renunciations are,
however, not viewed as particularly meaningful, and Hekmatyar’s covert political role is considered firm. Indeed, he is believed by
some informants to be pursuing broad infiltration of the government, though the extent of his political reach is not considered to
be deep at present.
24
to Afghanistan, who it released three months later. It is an increasingly active organisation,

particularly due to the lessened interference of Pakistani security services, and is significant, among
other reasons, as a source of channelling finances and fighters to Afghanistan. In addition to TTP, a
variety of other Pakistani and Kashmiri insurgent and terrorist groups have the potential to engage
in Afghanistan. These groups may find their political aims within Pakistan assisted by instability in
Afghanistan or, more simply, may decide to join their fellow fundamentalists in their struggle on the
other side of the Durand Line out of anti-Western sentiments. A history of tribal cooperation in
cases of shared political pursuit is common between Afghanistan and Pakistan.
Figure 4. Location of Key Armed Groups
Al-Qaeda – At present, there are 14 global jihadist groups operating in Afghanistan, of which al-
Qaeda is the only critical actor.28 While considered a more meaningful symbolic and financial rather
than militant force, al-Qaeda is believed to be behind the increasing use of tactics such as
kidnappings, beheadings and suicide bombings, practices not previously seen in Afghanistan. Al-
Qaeda volunteers from abroad, excluding Pakistani Pashtuns, are commonly unwelcome by the
Taliban inside Afghanistan.29 As such, al-Qaeda’s support may flow to proxies operating in
Afghanistan such as Tahir Yuldashev’s Islamic Movement of Uzbekistan/Turkestan (IMU/T), which
seeks to destabilise the Uzbek government by fostering regional instability and by winning long-
term backing from regional jihadist organisations and fundamentalist financiers.
28 R. Weitz (2008) ‘Afghanistan: New Approaches Needed To Defeat Insurgency’, Eurasia Insight, 17 April.
29A. Giustozzi (2007) Koran, Kalashnikov, and Laptop: The Neo-Taliban Insurgency in Afghanistan (New York: Columbia University
Press), p. 131.
25
Narcotics Traffickers – These networks, which exist in nearly every province of Afghanistan,
extend from poor sharecroppers to ministry-level affiliates and protectors. Rather than involving a
simple connection between farmers and traffickers, they involve a highly complex and flexible
structure similar to that of any organised criminal activity. Corruption of those Afghan agencies
charged with controlling opium production, particularly the Ministry of Interior (MoI), the Afghan
National Police (ANP) and the Counter-Narcotics Police of Afghanistan (CNPA) has rendered them
largely immune from domestic law enforcement or interdiction. Eradication, where applied, has
done limited amounts of damage to these networks, which shift their enterprise to neighbouring
areas and, later, return to those areas from which they had previously been removed. Individuals
involved rarely have an ideological aim and are primarily driven by profit. Such networks, far from
promoting the overthrow of State structures, prefer low-level violence which complicates
interdiction efforts while allowing logistical networks to function.
4.3 Motivating the Insurgency

Perhaps no question is more difficult than parsing the motives of the insurgency. Its broad and
evolving composition, particularly its increasing adoption of the Mujahidin identity,
reflects even more rapidly changing and diversifying motives.
International Motives – Many fighters are driven by the belief that their culture, country and
faith are under attack. Afghans are regularly exposed to international events such as the war in Iraq,
Abu Ghraib and Guantanamo Bay scandals and the religious conversion (to Christianity) of Abdul
Rahman in Afghanistan, among others, has convinced an increasing number of Afghans that a
global war has been launched against Islam and all Muslims. Still others, such as those who killed
nine US soldiers in Kunar Province in July 2008 after a reported 36 civilians were killed by errant
airstrikes nearby, are motivated by concern for their personal safety and the impression that the
international military presence provides greater security risks than benefits.
National Motives – Still others fight to defend their nation against what they perceive as a
foreign occupation and a puppet government in Kabul. Such motives have been driven primarily by
the loss of the State’s credibility due to its failure to provide anticipated levels of development
assistance and public services and the corrupt nature of many government representatives,
particularly the police, the judiciary and local (district and provincial) officials. In the words of the
US Ambassador to Afghanistan: ‘There is deterioration in terms of personal security. People are more
frightened. It's the problems with the police; it's corruption; it's weak local governance.’ 30
Societal/Individual Motives – Individual motives should also be closely watched, particularly as
the mobilisation of insurgents is not commonly taking place ‘organically’ in response to specific
incidents or the presence of international forces but upon weighing the risks and benefits posed by
involvement in an illegal armed group. Some such fighters participate as a source of employment
and income in a weak economic environment. While few insurgents are paid a salary, despite some
reports to the contrary, participation in an armed group may give them access to resources and
allows them to evade the shame associated with unemployment. In such instances, fighting is the
only way to prove one’s manhood in the Afghan context. Still others are motivated by loyalty to
commanders, particularly former Mujahidin, or by the perception that affiliation with an armed
group is necessary to avoid future retribution from commanders or insurgent groups.
The international, national and individual motives are closely inter-twined and not mutually
exclusive. Many fighters are likely influenced by several in making the decision to participate in an
armed group. Further explorations of these motives may be found in the Strategic Conflict
Assessment final report.
30 David Ignatius (2008) ‘Two Fronts, Same Worries’, The Washington Post, 27 April, p. B07.
26
4.4 Financing the Insurgency

Despite these separate motives, it should also be noted that fighting requires a source of support.
Al-Qaeda, the Taliban, narcotics trafficking, charitable donations and the black market trade in
luxury goods have emerged as some of the most significant sources of funding for insurgent groups.
What should be understood, however, is that the insurgency has a highly diversified portfolio
and minimal operating costs. Attempting to deny the insurgency or Taliban financial
support is neither feasible nor an effective way in which to pursue security.
Al-Qaeda and the Taliban – Al-Qaeda is reportedly a significant source of funding for the Taliban
and almost the sole source of income for the IMU/T. Private contributors to al-Qaeda in the Gulf
States have reportedly been requesting that their funds support operations within Afghanistan. The
Taliban may, though reports differ, have itself become a source of financing for various insurgent
groups, including the Haqqani Network and Hizb-e Islami.
Narcotics – The international community’s assumption that poppy cultivation and trafficking
supports the insurgency is considerably overstated. Poppies are not the insurgents’ blank
cheque they are perceived to be. It must, however, be admitted that the informal ‘taxation’ of
cultivation, transportation and, increasingly, processing31 may provide a limited amount of financial
support for all armed groups throughout the country. However, it is important to recognise that
total poppy eradication would be unlikely to significantly influence the insurgency. Rather, it would
likely increase deprivation and strengthen insurgent recruitment.
Zakat – In addition, financial support for the insurgency also comes from Pakistan, where it is given
as unrecorded zakat, or charity. According to Pakistan’s Ministry of Religious Affairs, only 4.2 billion
Rupees (£32 million) are given as zakat through official channels. In contrast the madrassas are
reported to receive 72 billion Rupees (£552 million) in zakat from unknown donors. It is suspected
that the practices of Hawala and Hundi are used in transferring a portion of these funds to the
Afghan and Pakistani insurgencies, making detection exceptionally difficult.32
The Black Market – Yet, one of the fastest growing sources of income is the black market trade in
goods, primarily from China, into Pakistan and Afghanistan.33 The re-export of electronics, vehicles
and other items – thus manipulating regional tariff regimens – is an expanding business which will
grow as Gwadar, in Pakistan, will become the largest container port in the Arabian Sea in the
coming decade. The estimated volume of goods being moved through Gwadar by container is
expected to increase from 8 million tonnes at present to at least 20 million tonnes by 2020. In 2002,
the UN estimated that only two per cent of containers worldwide were checked. 3435 To compensate
the family of a suicide bomber, which reportedly receives US$300, requires only 40 or 50
per cent of the proceeds from the sale of a single camcorder on the black market.
Despite these funding streams, it is important not to overplay their importance. The Afghan
insurgency is a low-cost operation. Bomb-making materials, the main input of IEDs and suicide
bombs, are readily available in Soviet-era unexploded ordnance and landmines. As such, it is
unreasonable to assume that the cessation of funding, even if possible, would lead to the
widespread collapse of the insurgency.
Understanding conflict in Afghanistan, however, goes far beyond this analysis of actors, motives and
financing. The insurgency is taking place within a highly dynamic context of state building,
31 The ability to process poppies within Afghanistan has recently expanded from an almost complete lack of processing facilities five
years ago. At present, informants indicate that 2/3 of Afghan poppies are processed domestically.
32 Personal communication, Ministry of Religious Affairs, Islamabad, Pakistan, April 2008.
33 Personal communication, MoI, Kabul, Afghanistan, April 2008.
34 United Nations (2002) Container Traffic (New York: UN).
35 Personal communication, personnel of a multi-national shipping company, April 2008.
27
economic development and social change. It remains highly plausible that, as the Taliban
proved, a strong state (even if such strength is widely resented and achieved through
violence) can pre-empt and dissuade challenges. Similarly, an opportunity-laden economy can,
to a certain degree, limit (if not ultimately stop) insurgent recruitment and integrate rather than
fragment the country and the region. Yet, as the next two sections will show, constraints to state
building and economic development have limited these potentially beneficial influences.
28
5. Governance and the State

The conflict results, in large part, from the failure to establish a State with governmental
institutions which are strong or legitimate enough to contain violence and mandate a
certain degree of compliance. The issue of governance in Afghanistan has been felt within all
sectors, from conflict to the economy and social exclusion. As such, it is perhaps one of the most
ever-present components in all outputs and, in particular, within the Political Economy Analysis and
Growth Diagnostic. The overall finding is that the State has itself been the site and cause of conflict
and contestation. The dual-legitimacy trap whereby it balances responsibility to its
international stakeholders and its citizenry has undermined the degree to which it has
been able to satisfy either. The government’s effective marginalisation in assistance delivery,
despite a predominantly technocratic focus upon public administration rather than political
cooperation, has further served to erode its legitimacy. Finally, corruption has not only challenged
the government’s credibility but also undermined its bureaucratic effectiveness and contributed to
minimising foreign direct investment (a topic further addressed in Section 6).
5.1 The Envisioned State and Underlying Assumptions

State formation in Afghanistan was driven by a core set of assumptions regarding the type of state
which was required. These are examined in detail in the Political Economy Analysis final report. The
primary assumption was a conviction that external support aimed at creating a neo-liberal
Weberian state36 is best placed to strengthen centre-periphery relations and to create the
conditions for enduring peace, stability and economic prosperity. It was, thus, concluded that
the State – itself – should be capable of extending its legitimacy throughout the country, providing
security, delivering basic services and raising revenue from productive activity. To this end, the
majority of the international community’s focus has been on strengthening the capability of the
central government to perform its functions more effectively.
Other assumptions ensue, or have been implied, from this basic starting point. For example, efforts
have been made to develop a modern democratic constitutional state leading to the creation of
fully-functioning governmental institutions. However, in the light of continued insurgency,
increasing corruption and a highly limited ability to raise enough funds to support even the
government’s basic operations, there is a need to review these assumptions and determine whether
they still apply, whether they need to be changed or whether new evidenced-based assumptions are
needed to guide the next generation of international engagement.
5.2 Setting the Stage: The Bonn Agreement

In addition to its conceptual weaknesses, the Afghan State was also built upon a fragile foundation
and without the buy-in of key stakeholders such as the Taliban. The Bonn Agreement was not a
peace agreement, and the absence of important political groups around the negotiating
table led to the establishment of an administration incapable of forging a secure
environment. This ‘elite pact’, as it is described in the Political Economy Analysis, demonstrated one
of the common historical trends whereby incomplete coalitions ultimately undermine even the best
attempts at state building, thus precipitating a return to violence.
The decision to pursue an ‘elite pact’ was further complicated through the Bonn Agreement’s and
US-led international community’s subsequent promotion of an ethnic (Panjshiri Tajik)
elite. Following the march of the Northern Alliance (particularly Shura-I Nazar) into Kabul at the
36The concept of a Weberian State stems from Max Weber’s influential definition, in that an organisation that successfully
claims the monopoly on the legitimate use of physical force within a given territory. Such monopoly traditionally is
mobilised through the armed forces, civil service or state bureaucracy, courts and the police. In all sense Afghanistan is
recognised as a juridical state by the international community, but failures in political settlement most notably with the
Taliban continue to contest (both politically and territorially) such legitimacy.
29
end of 2001, northern forces took control over the Ministries of Planning, Defence, Interior and
Foreign Affairs, leaving finance to an ethnic Pashtun. Furthermore, commanders and so-called
‘warlords’ clung to power in the provinces. Of the country’s 32 post-Bonn provincial governors, 20
were militia commanders or ‘strongmen’ (Giustozzi, 2004).
The foundational failure of the Bonn Agreement’s ‘elite pact’ is resoundingly made within both the
Political Economy Analysis and the Strategic Conflict Assessment and should be viewed as perhaps
the most notable factor undermining the State. Without a ‘grand bargain’ involving the
Taliban and other contemporary insurgent groups, the State will fail to mobilise adequate
legitimacy and security to proceed with a relatively unchallenged process of institution
building. Furthermore, despite the temptation to equate the formation and development of
administrative entities and capacities with state building, the two should be understood as
fundamentally different, and the emphasis on the former should not lead one to believe that the
latter has been successfully achieved. A state is far more than its administrative parts.
5.3 Territorial Control

One of the most widely reported results of the troubled ‘elite pact’ – the Bonn Agreement – has
been the government’s limited territorial control. With the Taliban already controlling up to 11 per
cent of the country and 58 per cent now deemed under the control of local elites, the Afghan
government currently only has de facto control (albeit weak) of a little under 31 per cent of the
country. Other claims have indicated that the Taliban or its affiliates control up to 54 per cent of
the country, leaving little beyond certain major cities to the government. This trend is unlikely to
improve with the number of violent attacks in eastern, western and northern Afghanistan increasing
rapidly. The future, thus, could involve the historically common transformation of
Afghanistan into an ‘enclave state’ with only islands of government control between large
swaths of ungovernable territory.
5.4 Revenue Control and Mobilisation

5.4.1 Control of Revenues
The Afghan government has been marginalised in the provision of assistance and has controlled
only a fraction of its own core operating budget. The Afghanistan Reconstruction Trust Fund (ARTF),
originally designed to act as a de facto treasury for the government, has remained predominantly
under the control of its ‘donors’ meeting’.37 Due to many – though certainly not all – donors’
preference for direct execution through implementing partners, the Afghan government has only
had control over approximately one per cent of all project-based international assistance according
to an evaluation conducted in 2005 by the Norwegian firm Scanteam. The actual amount of money
controlled by the government is likely greater, though it remains difficult to differentiate between
real government-controlled funds and those which are formally included on-budget but which
evade the genuine control and oversight of governmental institutions such as the National
Assembly.
5.4.2 Revenue Mobilisation38

One of the most notable failures of the Afghan State has been the inability to mobilise sufficient
37The ARTF is a major funding channel for support for the GIRA rehabilitation and development efforts. The largest
contributions to the fund has been made by 1) the United Kingdom (24.6 per cent), Canada (17.6 per cent), the EC/EU (12.9
per cent), United States (12.1 per cent), Netherlands (10.3 per cent), Norway (5.3 per cent) and Germany (4.9 per cent) of 28
donors who totally paid in US$2.34 billion by spring 2008.
38The mobilisation of revenue by the Afghan government is discussed in each ‘Understanding Afghanistan’ final report. For
a particular comprehensive discussion, see Section 6.4 of the Political Economy Analysis final report and Section 5.2.2.2 of
the Growth Diagnostic Scoping Study final report (‘Fiscal Sustainability’ sub-heading).
30
revenues to cover even basic operating costs. By the end of 2008 it is anticipated that the Afghan
government’s revenue-to-GDP ratio will have returned to where it was in the 1940s, at around 7.5
per cent of GDP, allowing the Government to cover some 69 per cent of its projected (and very
minimal) operating expenditures. This inadequate level of resource mobilisation results, in
part, from the over reliance upon external funding which weakened the imperative to
maximise domestic revenues. The current fiscal crisis is compounded by a massive
expansion in expenditures in the security sector. This fact has pushed Afghanistan beyond any
reasonable hope of fiscal independence, perhaps requiring substantial levels of external support
over the next 20 to 30 years or more (thus re-creating one of the primary impediments to effective,
domestic state building). On the current trajectory, potential gains from improved tax administration
and broadening the revenue base will likely be offset by increased costs in security provision.
Several ‘Understanding Afghanistan’ team members felt that this failure is perhaps as strong a
challenge to State sovereignty and legitimacy as the mounting insurgency. Without sufficient
domestic revenues, the Afghan government will continue to be heavily controlled by its
international supporters, will be unable to use government-controlled finances as a tool
of extending national solidarity and will allow better financed non-State entities to
increase their influence upon the country’s periphery (and, increasingly, its centre). By
contrast, the Taliban regime was able to extract sufficient revenues to cover its non-military
expenses (which were financed by governmental and private contributions from Pakistan and the
Middle East). The Taliban taxed production at 10 per cent as well as opium and others sources of
illicit production at 10 to 20 per cent.
By contrast, the current Afghan government lacks the administrative infrastructure to collect taxes
and has lacked the coercive means to extract revenue except on a highly selective and often
politicised basis (discussed further in Section 6). The informal economy, which the Growth
Diagnostic showed as a massive source of revenue if formalised, has been beyond the regulation of
governmental institutions.
5.5 Corruption, Predation and Taxation

The State’s lack of geographical and financial control has been further complicated by an endemic
and, seemingly, growing level of corruption within the public administration. A recent survey of
corruption in Afghanistan has suggested that informal networks operate in a highly coordinated
manner and lead to preferential treatment by customs and other government officials (Gardizi,
2007). The 2005 World Bank Investment Climate Assessment has ranked corruption as the third
largest barrier to business in the country.39
While initially seen as a traditional form of network building and as, essentially, a facilitator of
institutional operations, corruption has become largely an end within itself. ‘Traditional’
corruption based on patronage networks and tribal linkages as well as new forms of
corruption are increasingly being ‘institutionalized’ as bribe-extracting mafias connected
by corruption networks known as Band-Bazi (Gardizi, 2007). According to Rubin (2000),
Afghans have commonly seen control of a centralised state as ‘war booty belonging to the victor’, a
belief which appears to remain embedded in much of the politics of the region. Moreover, the
failure of the current Government – in spite of the adoption of international governance,
accountability and transparency systems (PFM, Audit, etc.) – to stamp out corruption undermines its
very legitimacy and leads to poor perceptions of the public sector.
Corruption has, thus, become one of the few manners in which the State interacts with its
citizens, thus conveying the widely adopted perception that the government is more a
source of predation than protection. This problem was described within all outputs as most
39 The first two barriers were electricity and access to land.
31
notable within the law and justice sector with the judiciary and ANP having been almost entirely
discredited in the eyes of ordinary Afghans.
It may be important to highlight that corruption, while a common feature of Afghan state
institutions throughout history, was effectively addressed by the Taliban. Most notably, they
continuously moved senior civil servants from institution to institution, thus cutting corruption
links in the process. Furthermore, though less applicable to the current context, the application of
brutal punishments after public trials provided an effective and brutal reminder of the penalties of
corruption.
5.6 (De) Mobilising Legitimacy

The aforementioned factors – little territorial or financial control, weak resource
mobilisation and rampant corruption – have severely undermined the legitimacy of the
Afghan State. This fact was broadly agreed upon and formed the basis of much of the Strategic
Conflict Assessment and, in particular, of the Political Economy Analysis. While various
‘Understanding Afghanistan’ team members held slightly differing perceptions of the meaning of
legitimacy, it was broadly seen as the ability to provide security, deliver basic services and gain
revenue in a legal and transparent manner.
The loss of legitimacy, it should be noted, also results from the Afghan government’s inability to
meet unreasonably high expectations set by the international community. The secular Afghan State,
despite its limited Islamic features, also failed to claim authority or legitimacy on religious or
ideological grounds. Though recommendations for re-gaining a portion of its lost legitimacy are
made in Section 8 of this report, any modification of the dismal state building status quo will
be challenging given the activation of a ‘cycle of illegitimacy’. While this concept was not
specifically highlighted in any of the individual output reports, the disparate findings, when
combined, portray a cyclical process.
The ‘cycle of illegitimacy’ in Afghanistan begins with the current high level of financial and security
reliance upon the international community. Given this external assistance, mobilising domestic
revenues will continue to be de-prioritised by the Afghan government, and a high level of
dependency will remain. The government’s resulting lack of revenue will maintain low salaries for
public employees and lead them to continue relying heavily upon illicit rent-seeking behaviour. The
resulting corruption, which those in the government have little interest in addressing for fear of
revealing their likely complicity, will severely detract from private sector development and foreign
direct investment. Resource mobilisation and, hence, legitimacy will continue to be limited by the
resultant slow-down of commerce, and the international community, convinced that a corruption-
riddled State cannot be trusted, will continue to establish parallel institutions for delivering
assistance. As a result, the marginalisation of the government in service-delivery will further detract
from its legitimacy. The government’s final opportunity for becoming seen as more legitimate, a
stronger role for Islam and Ulema in the government or some degree of acceptance for the Taliban
as a political entity, remain blocked by secular international donors who control Afghanistan’s purse
strings and prefer only a Muslim façade.
Breaking this cycle, as will be further discussed, will require the joint reduction of corruption and
mobilisation of additional State revenues or a willingness to seek stability through political
engagement with the insurgency at the risk of substantial financial loss from (certain) disapproving
international donors. The final possibility, and the one recommended within this report, is for the
international community to accept a formal role for the Taliban within Afghanistan (through a
‘grand bargain’).
Currently, the greatest victim of this legitimacy trap may be President Karzai. Having
inherited a political system hostile to the Taliban and beholden to the Northern Alliance, he was
guaranteed opposition from the Taliban and their Pashtun supporters while knowing that any
32
attempts to seek support from the South would result in cries of betrayal from the North. President
Karzai has clearly struggled to find a middle ground that balances concerns over domestic and
international legitimacy at the same time.
Given the degree to which his credibility has been eroded internally and externally, he may
ultimately be unable to mobilise support from the Taliban and former Mujahidin factions while
keeping the international community in tow. In the absence of a political party of his own, against
which he could rally support, he has been exposed to heavy criticism at home (including from
within the National Assembly) as well as abroad.
Indeed, it frequently seems as if President Karzai, while certainly an imperfect leader, has unfairly
received the brunt of criticism for a situation so much out of his control and in the hands of the
international community, the Taliban and the Northern Alliance commanders-turned-politicians.
International actors such as DFID and HMG should fully understand that the security and
governance challenges being faced by Afghanistan are not entirely of his doing and that his
replacement in the 2009 elections will not guarantee a sudden turn-around. Further steps, outlined
in Section 8, must be taken.
33
6. Economic Development
The economy, it must be noted, is heavily reliant upon governance. Any state which lacks control
and capacity will be likely to witness the breakdown of economic order and the growth of
only those sectors that thrive on conflict and instability. Once such enterprises have been
developed, worse still, they exercise their growing influence to ensure that the conditions which
have allowed their emergence are able to persist long into the future. The question of economic
development is addressed primarily within the Growth Diagnostic and its separate Policy Discussion
Paper, though related issues appear throughout each of the ‘Understanding Afghanistan’ outputs.
The core question concerns the constraints on growth and development, an issue to which the
Growth Diagnostic applies standard economic tools as well as the lens of political economy.
6.1 Economics and Conflict in Afghanistan

The relationship between economic development and conflict is an undercurrent throughout
‘Understanding Afghanistan’. The Political Economy Analysis points to the large number of poor,
uneducated ‘angry young men’ whose participation in armed anti-government or criminal groups is
likely. The Strategic Conflict Assessment goes on to highlight the social experience of poverty within
Afghan culture as contributing to conflict far more than basic deprivation. Furthermore, the
Strategic Conflict Assessment as well as the Growth Diagnostic (particularly its Policy Discussion
Paper) emphasises the far-reaching and negative economic effects of poppy eradication and
the presumed, though relatively un-studied, likelihood that it could (and does) contribute
to Taliban and insurgent recruitment.
When combined, the outputs of ‘Understanding Afghanistan’ point to the dire security challenge
created by a substantial and unemployed youth population. This ‘youth bulge’ is frequently devoid
of economic opportunities and engages in insurgent and criminal violence as an alternative means
to pursue both economic gain and enhanced social standing. With more than half of the
population below the age of 19 and up to 40 per cent rates of employments, the prospect
of this ‘bulge’ turning into a new generation of insurgents and poppy traffickers is
exceptionally likely unless appropriate steps are taken. The potential of short-term, market-
driven economic growth to win the support of this group is rendered decreasingly likely by a hostile
business and security environment and by potential future reductions in external assistance.
Economics and security are closely related, and the former must be prioritised if the latter is to take
root. The remainder of this section suggests strategies for doing so.
6.2 The Economic Context

The Afghan economy has seen double-digit growth rates since the international intervention began
in 2001. Since 2002, per capita GDP has doubled. Official exports have grown more than 300
per cent over the last five years. Currently, however, the post-conflict ‘catch up effect’ –
whereby low levels of recorded economic activity during conflict are followed by proportionally
massive increases – is dwindling, and future growth is expected to require more reform and input as
well as security and stabilisation. Investment has fallen since 2005, and real GDP is anticipated to
decline from 13.5 per cent in 2007/08 to 7 per cent as a result of reduced aid inflows (as a
percentage of GDP).
In 2006, services were the main sector of the economy, at 38 per cent of GDP, followed by
agriculture at 32 per cent and industry at 27 per cent. Since 2005, industry, boosted by donor-
funded construction and entrepreneurial manufacturing, has been the most dynamic sector. Growth
in services is driven by aid injection into telecommunications, aviation, hospitality (restaurants and
hotels) and other sub-sectors in which there is a high demand from the international community.
That said, a fall-off in the consumption rates among international actors in Afghanistan
and in reconstruction and development assistance may re-structure the economy and
34
weaken economic growth. The Growth Diagnostic shows that economic growth is only
partly based on sustainable, national developments and should be considered highly
fragile.
Figure 5. Afghan Imports and Exports, 1962-2006
1400
1200
1000
Real US$ Million
800
600
400
200
0
1962
1964
1966
1968
1970
1972
1974
1976
1978
1980
1982
1984
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
Imports Exports
Source: United Nations Commodity Trade Statistics Database (COMTRADE) 2008
Investment, Foreign and Domestic – Investment peaked in 2006/07 driven by donor-funded

government investment, though private investment declined in the same period, with 2005 marking
the turning point. The Afghanistan Investment Support Agency (AISA) reported a decline in the
number of new businesses registrations during the same period. In 2005 the number of
companies registered with AISA declined for both domestic and foreign enterprises, and in
2007 the number of foreign companies declined almost 50 per cent within one year.
Similarly, the IMF (2008) reports foreign direct investment (FDI) peaked at 4.2 per cent of GDP in
2005, was reduced to 3.4 per cent in 2006/07 and is projected at 3.3 per cent or less through, at
least, 2009. Based on AISA registrations, only services and construction seem to be attracting
additional investment, especially from Afghan business owners themselves. It remains uncertain and
relatively doubtful that foreign, non-governmental investment will increase in the short to mid-
term.
Agriculture – Agriculture, despite accounting for almost one-half of Afghanistan’s exports in 2006,
has not been particularly successful. The sector posted negative net growth since 2003,
though this decline is partly due to external factors such as drought and the replacement of licit
crops with poppies. The most recent period of drought, in 2006 and 2007, caused a 20 per cent drop
in the sector. However, with 3.3 million Afghans involved in opium cultivation and a large portion of
the economy directly or indirectly reliant upon narcotics trafficking (and the capital it injects into
the economy), decline in this sector poses a major economy-wide risk. Sources of credit, many of
which are based on narcotics-derived income, will dry up. Once the influence of poppy
cultivation is isolated from within official agriculture figures, this sector is dramatically
reduced to 19 per cent of official GDP.
This sector, given its dependence upon transportation, has been one of the most susceptible to
increased criminal and insurgent activity. Roadside crime and extortion has made a great deal of
35
improved road and border port infrastructure difficult to access by would-be agricultural exporters.
As the Growth Diagnostic indicates, ‘the government’s inability to extend the rule of law along key
export routes will leave exporters of agricultural outputs at the mercy of informal taxation’ (Ulloa,
2008:66). Informal taxes and extortion, that alongside the growing costs of fuel, are making the
transport of goods to domestic and regional markets financially unviable, especially for the smaller
agricultural producers. The Export Promotion Agency of Afghanistan (EPAA) estimates that a truck
of melons on the way to market from Mazar-e-Sharif may be stopped up to 20 times inside
Afghanistan and illegally taxed.
Figure 6. Afghanistan’s Informal Economy, by Sector
Source: World Bank (2004)

Note: per cent figures refer to share of sector in total GDP, shadings to very rough estimates of the percentage of the
informal economy in the sector.
Informal Economy – The informal economy, which is unrecorded rather than necessarily illegal
(though much of it is), includes barter trade, manufacturing, commerce and other non-recorded
services, as well as smuggling and re-exports. Afghanistan’s informal economy, including poppy
cultivation and narcotics trafficking, has been estimated at around US$7 billion annually,
or between 80 to 90 per cent of Afghanistan’s recorded GDP. The main components in the
informal economy are: opium production and processing activities (35 per cent of official GDP),
subsistence agriculture and livestock (30 per cent) and the illegal trade in goods other than opium
(8 per cent). The bulk of the labour force is employed by the informal economy, and the large
majority of Afghanistan’s population is dependent upon it.
Institutional Multiplicity – While all post-conflict environments involve numerous overlapping
and competing institutions, this situation has been particularly pronounced within Afghanistan. The
Growth Diagnostic Policy Discussion Paper provides a full accounting of such institutions, but the
following are deemed to officially and unofficially share responsibility: (i) government entities such
as the Central Bank, the Ministries of Labour and Social Affairs, Commerce and Industry, Finance,
Rural Rehabilitation and Development and Agriculture, Irrigation and Livestock; (ii) legal institutions
and policies such as the Ministry of Justice, the 2003 Private Investment Law, the 2006 Labour Code;
and numerous pending laws (the Secure Transaction Laws of Moveable and Immovable Property and
the Negotiable Instruments Law among them); (iii) business membership organisations such as the
36
Afghan Chamber of Commerce and Industry (ACCI), the Afghan International Chamber of Commerce
(AICC) and at least a half dozen others; and (iv) informal institutions reflective of the combat,
shadow and coping economies (see Policy Discussion Paper). These institutions have, in the context
of weak governance, little rule of law and over-centralisation, begun to engage in informal
collaboration and coordination which will require transformation (rather than dissolution) once an
improved policy environment is meaningfully pursued by the Afghan government (at all levels) and
its international partners.
Policy Environment – The Growth Diagnostic and its Policy Discussion Paper highlight the
unpredictability of economic policy in Afghanistan as a factor contributing to the difficult
investment environment. Despite the ANDS establishing itself as the centrepiece of
Afghanistan’s private-sector-led future, there is startlingly little detail given regarding
the strategies that will deliver this aim in the medium- and short-term in this and in
other policy documents of the Afghan government. Thus although the ANDS confirms that
‘a growth strategy is the backbone of ANDS’ (ANDS, 2008: 40), benchmarks related to
private sector development lack sufficient detail. This reflects not only the de facto peripheral
treatment of private sector development but also a range of different opinions within government
(at the national and sub-national levels) and the international community over the appropriate
direction of economic policy in Afghanistan. Donors have spent time and resources, though not at
sufficient levels, drafting and implementing policies and programmes which are, in the end, stalled
or ignored by Afghan actors who consider them inappropriate. These differences in opinion,
including significant divergence from the free-market models favoured by donors and IFIs are often
treated as ‘embarrassing’ by donors and have not been addressed in a public forum. A number of
conferences dealing with private sector development have skirted around these issues, and often
fallen into the re-conceptualising of the same shopping lists of desirable outcomes for the private
sector. While such lists are apt, the widely agreed upon prioritisation of interventions, as was
pursued within the ‘Understanding Afghanistan’ Growth Diagnostic, must be achieved.
6.3 Constraints to and Opportunities for Growth

In addition to the informal economy and the lack of a coherent PSD policy, the economic
situation within Afghanistan has, thus far, been inhibited by two core features: (i) the
type of corruption previously highlighted in Section 5 and (ii) the lack of infrastructure.40
First, however, it is important to note that the following two constraints – economic rule of law and
infrastructure – were identified only following a review of several additional factors which, while
often viewed as constraints, were not seen as the most immediately pressing and significant. These
include: high costs of finance, low returns on investment, human capital/resources, global market
integration and macro-economic instability. Such potential but ‘discarded’ constraints are addressed
later on, and their remaining relevance is emphasised.
6.3.1 Economic Rule of Law

Where government regulation is really needed, such as in extending the rule of law, setting and
enforcing predictable ‘rules of the game’ and in ensuring the standards of goods on the market,
‘there is no capacity to enforce rules and regulations, even where they exist’; instead
‘government regulation of markets is bureaucratic, confused, contains many inappropriate
and overlapping functions shared by different ministries and hence is often used as a
means of rent-seeking by officials’ (Paterson, 2006: 2).
The Growth Diagnostic identifies three governance-related issues that reduce the ability of
40 These specific constraints were arrived at following an economic methodology which was not able to directly consider the
influence of conflict and insecurity. As such, they are joined (in Section 6.4) with an analysis of several additional factors
related to the political economy of state building and conflict.
37
entrepreneurs to receive the full economic benefits of their enterprises and investments. These are
taxation, corruption and property rights, what this section terms ‘economic rule of law’. In
particular, the 2004 tax reform and the subsequent selectively-aggressive behaviour of the Large
Taxpayers’ Office (LTO) as an economic ‘shock’ which has, to a significant extent, caused a reduction
and stagnation in foreign and domestic private investment since 2005. At the same time, a
perceptible increase in corruption has been reported by several agencies such as
Transparency International, Integrity Watch Afghanistan, the World Bank and others.
Even if the recent efforts to isolate large taxpayers from previous corrupt and inefficient tax
collection agencies indicate a move in the right direction, an inherently weak institutional setting,
such as currently exists within the Afghan government, cannot prevent ‘informal’ taxes and
corruption. Administrative fees, permits and licenses at the national and sub-national levels
of governance have increased, the majority of them unsanctioned, misapplied or illegal.
The MoI and the judiciary are perceived as the most corrupt entities in the Afghan Government
(Gardizi, 2007). Corruption and inefficiency also limit contract enforceability and property rights in
Afghanistan, with negative impact all across the economy, and very negative effects on the financial
market and long-term investment prospects. In addition, security issues linked to the conflict (i.e.,
suicide bombings and armed conflict) as well as criminal activity (i.e., the opium economy,
abductions, robbery) have also, as previously noted, worsened since 2005.
Figure 7. Hausmann, Rodrik and Velasco Growth Diagnostic Framework41
41 This diagram was created within the process of the Growth Diagnostic, and readers are advised to see output 3.4.1 for a
comprehensive interpretation. Key terms, however, deserve explanation. ‘Low appropriability’ refers to an investor’s limited
ability to receive the market-derived profits of one’s investment or enterprise. For instance, corruption would result in low
appropriability given that profits would be appropriated by rent-seeking officials rather than by the people responsible for
generating them. ‘Poor intermediation’ refers to a low level of reasonable trust between creditors and loan recipients which
results in difficulty accessing credit without burdensome requests for high levels of collateral or the payment of excessive
processing fees. Finally ‘information externalities’ or ‘self-discovery’ simply refers to a country’s inability to find its niche
within the world economy, often due to the constraining influence of negative information concerning that country.
Information externalities are the perceptual elements restraining basic market forces which link demand with logical
suppliers.
38
6.3.2 Crime and Insecurity

Government weakness in providing security, the increased frequency of attacks by insurgents, and
lack of faith in the police and judiciary are leading to a failure to address the specific threats to
business stemming from organised crime and insurgency related insecurity. According to the
Criminal Investigation Department (CID) of the Afghan National Police (ANP), some 130 cases of
abduction were reported from March to September 2008, of which 100 people were still in the
hands of the hostage takers and five had been killed. Of the total kidnappings during this time, only
13 involved foreigners, and the overwhelming majority of such incidents were political and,
significantly, financial in motivation (Shalizi, 2008). This threat which is specifically targeted against
businessmen seen as wealthy and able to pay, comes over and above the general insurgency-related
deterioration of security in Afghanistan.
The private sector is incurring added expenses in securing private protection and security, which
may be prohibitive for some players. There is a need to better understand the impact of security
and crime upon business, since the upward trend in these problems in 2005/06. The World Bank
Investment Climate Survey of 2005 found that managers did not rank crime and security as a major
constraint to investment and attributed this to improved security in major cities and the
mechanisms, albeit high cost ones (up to 15 percent of sales spent on security infrastructure,
according to the report) adopted by businesses (World Bank 2005). However, this survey was too
early to capture the new levels of insecurity and criminality experienced since 2005 and we may
speculate that security would feature more prominently were the survey to be conducted today.
6.3.3 Infrastructure
Infrastructure is the most critical issue for Afghanistan’s competitiveness and long-term
development. With the appropriate investments in transit and storage infrastructure, in
particular, the country’s geographic characteristics could shift from a liability to an asset.
Afghan would, as previously discussed, reclaim its role as a trade route and would be able to better
exploit domestic natural resources.
Electricity supply remains a particularly poignant constraint. Afghanistan is still a long way from
realising additional and reliable supply. Even if most of the infrastructure is in place, the power
purchasing agreements (PPA) with Uzbekistan are still being negotiated and rising fuel costs may cast
doubt over the viability of the diesel power plant. Most importantly, however, the unreliability and cost
of electricity provision (whether through the use of Industrial Parks or diesel generation) is a source of
great disadvantage to Afghanistan’s competitiveness. The ICA survey reports that firms lose on
average about 18 percent of their merchandise value due to power disruptions, and this
number can reach 30 percent in provinces more dependent on the national grid such as
Kandahar. Power generation is heavily dependent on imported fuel and the diesel market in
Afghanistan is characterized by abuse of market power and barriers to new entrants, corrupt allocation
of import licenses, and unregulated imports of poor-quality fuel (Paterson, 2005).
From a long-term (or possibly mid-term) perspective, those areas of the economy with the greatest
potential for future growth and value-adding will require a substantial improvement in
infrastructure. These include, for instance, agricultural business as well as mining and some
industrial production.
6.3.3 Opportunities for Growth

Perhaps the greatest opportunities for sustained economic growth in Afghanistan come through
stronger integration into the world economy. Agriculture, particularly added-value agriculture,
poses the single greatest opportunity though one which will require, at least, the following: (i)
improved transport infrastructure, (ii) support to value chains in the form of warehouses, cool-
storage and processing and packaging facilities, (iii) government-backed, internationally recognised
39
systems of quality certification, (iv) access to nearby ports in Pakistan and (v) improved security.
Furthermore, basic gains in agricultural techniques, input quality and mechanisation will be integral
in increasing the annual volume of agricultural produce.
Such systems, once in place, could also prove useful in sectors such as mining. While natural
resources pose economic opportunities for Afghanistan, their too-early exploitation could, in a
context of corruption and conflict, lend financial support for violence, as is already happening on a
limited scale. This sector should be safeguarded in the short-term in order to avoid detracting from
its long-term contribution to the economy.
6.4 Contextualising the Growth Diagnostic

It is important to note that when constraints are ‘discarded’ within the Growth Diagnostic, they
remain important areas for policy and programming. This is especially the case in the Afghan
context where policies aimed at promoting growth and investment are often bound up with the
other key priorities of the government and its international supporters such as job creation and
poverty reduction, two components not inherent to growth or investment per se but for which
growth and investment is a prerequisite. In the area of economic and social development, where
linkages are viewed by government as fundamental to quality growth and poverty reduction, the
overarching goal is to ‘reduce poverty, ensure sustainable development through a private-sector-led
market economy, improve human development indicators, and make significant progress towards
the MDGs’ (GIRA, ANDS, p. i).42 Thus, although the Growth Diagnostic indicates that high level
constraints to growth relate primarily to micro-economic constraints generated by government
behaviour and intervention, the ANDS, as a strategy for poverty reduction, stresses that the
interconnection of aims such as achieving high levels of quality growth cannot be met in the
absence of security, good governance, enhanced rule of law and respect for human rights, as well as
major gains in the spheres of social development (education, health, basic and essential services
etc.). The two documents remain highly complementary, with the Growth Diagnostic helping to
reveal those initial concerns which must critically address while the ANDS puts these into a larger
framework with a longer-term perspective.
42 In acknowledging that integrated approach is required to economic development to meet these goals and objectives,
sector investment programmes have been developed with regard to: (i) private sector development; (ii) energy; (iii) water
and irrigation; (iv) agricultural and rural development; (v) transport; (vi) information and communications technology; (vii)
urban development; (viii) mining; (ix) health and nutrition; (x) education; (xi) culture, youth and media; and, (xii) social
protection policies. Indicators and baselines for these programmes are provided in Annex II of the ANDS, and are therefore
not repeated here.
40
7. Poverty, Gender and Social Exclusion

The processes of economic development and state building in Afghanistan, as elsewhere, have been
accompanied by enduring spatial, social, political, economic and cultural cleavages in society.
Policies of resettlement, expropriation and redistribution have shaped forms of disadvantage based
on ethnicity and location. The gulf between an urban literate elite and a rural periphery has
been persistent.
The legacy of prolonged conflict in Afghanistan has resulted in new categories of powerful players
(such as commanders and warlords) and has increased the risk of elite capture of the State. Conflict
also predisposes the country to particular types of social disadvantages. This section focuses upon
poverty, gender and various other forms of social exclusion.
7.1 Poverty, Gender, Social Exclusion and Conflict

The role of social exclusion (including poverty and gender) within Afghanistan has, in part, been
marginalised given its lack of apparent relation to conflict. While social exclusion is a form of
structural violence and one closely associated with physical abuse and neglect, the
position of women or the disabled, for instance, is commonly perceived to bear no overt
relation to broader goals of defeating the Taliban-led insurgency. Indeed, an opposing
position is that attention to gender may be viewed as a challenge to Afghan culture and a
contributing factor to the insurgency. Such arguments have been demonstrated in the use of
women’s honour – its protection by Afghans and violation by the ‘enemy’ – as a rallying point
among the Mujahidin and the Taliban. Yet, it remains critical that poverty reduction, women’s
empowerment and social inclusion be designed in manners which support the overriding goal of
stabilisation if they are to be provided adequate levels of attention and resources.
7.2 Poverty
An examination of poverty headcount data shows that a significant proportion of the population
lives below the poverty line. The incidence of poverty is highly sensitive to small consumption
shifts43 as well as having marked seasonal dimensions.
Headcounts: The Spring 2007 survey estimates that 42 per cent of the population
(approximately 12 million people) live below the poverty line and do not meet their
minimum daily food and non-food requirements. This represents an increase over the 2005
estimate of 33 per cent44. Poverty headcounts are likely to be higher now (September 2008) given
the hard 2007-08 winter and dry spring leading to crop failure in many parts of the country. Rural
poverty is considerably worse than urban poverty (36 per cent as compared to 21 per cent for 2005,
45 per cent as compared to 27 per cent for 2007). While urban poverty rose during this period, rural
poverty rose at a faster rate. There are high levels of vulnerability to consumption poverty among an
estimated 20 per cent of the population who are not poor, but whose consumption level is just
above the national poverty line. Using NRVA 2005 data, it is estimated that only a five per cent
reduction in consumption could cause the national poverty headcount rate to rise from 33 per cent
to 38 per cent.
Seasonality: The seasonal variation in poverty is reflects the impact of winter on other aspects of
people’s lives (reduced access/productivity and higher expenditures on fuel, transport, medical costs,
etc.). Vulnerability to cold season shocks is more apparent among rural and Kuchi communities.
Levels of Consumption Inequality: While inequalities are significant, the NRVA data suggests
43 The absence of appropriate panel data prevented this study from being able to provide statistical analysis on the causes
of vulnerability.
44 In noting this increase, account has to be taken of differences in timing and method of the two surveys .
41
that consumption inequality per capita is relatively low compared to other countries in the region. 45
That said, low consumption inequalities exacerbated by limited access to luxury items and
widespread poverty are not uncommon in post-conflict countries.
Food Insecurity: Up until 2006-07 food security estimates have remained remarkably stable, with
21 to 27 per cent of Afghan households being unable to acquire sufficient calories to fulfil basic
nutritional requirements.46 Surveys confirm that there was little acute malnutrition but there
were high levels (45-59 per cent) of chronic malnutrition (stunting) and micro-nutrient
deficiencies. Furthermore, the shard decline in rural wage labour rates combined with a rapid rise
in food prices is likely to have substantially increased the number of food insecure and there are
recent estimates of 45 per cent of Afghan households experiencing food insecurity.
7.2.1 Poverty and Access to Public Goods and Services

The poor receive little in the way of public goods and services, though this fact derives from their
overall lack than to any deep-seated question of access by the poor versus the non-poor.
Comparative analysis of the access profile for basic services highlights the extent to which
the lack of access to health care, potable water, electricity, sanitary toilets and
community health workers is the norm for the majority of non-poor and poor alike. While
net primary school enrolment for the poorest quintile is as low as 17 per cent, even for the richest
quintile this figure rises to only 33.4 per cent, indicating that there are both availability and access
issues.
There is growing evidence that access to public goods is increasing in urban areas. This is due in part
to the stark contrasts between better off areas and growing slums (often due to returning refugees
and rural–urban migration) and partly relates to the extent to which better off urban households in
some cities and towns are able to pay for basic services such as water, education and health.
7.2.2 Characteristics and Location of the Poor

There is no simple way to characterise who the poor, and caution is required when interpreting data
relating to poverty. In NRVA 2005, for example, having a female head of household was not found
to be a strong predictor of being poor. However, qualitative research on chronically poor women
does suggest a correlation, particularly in rural areas, where widows are living without support from
other members of the family.
NRVA data supports the general view that poverty rates are considerably higher in the
mountains than in the plains, reflecting less productive natural resources, marginality and
remoteness with increasing altitude. It is estimated that 47 per cent of the population live in
hilly terrain, with 28.6 per cent living above an altitude of 2000 metres. At such, altitudes poverty
rates jump significantly above the national average. This is confirmed by poverty headcount rates at
the provincial level which vary from 10-20 per cent in the central plain to 77 per cent in Daikundi.
The highest rates of poverty are found in Badakhshan and the central highlands.
45 Data on consumption inequality highlights that the bottom 10 per cent of the population accounts for only 4 per cent of
total consumption, while the bottom 30 per cent accounts for 15.6 per cent share of total consumption. By contrast the top
10 per cent has a 21.1 per cent share of total consumption.
46 See Pinney and Ronchini (2007).
42
Figure 8. Poverty, Level and Extent, by Province
Source: Generated from NRVA 2005
The disaggregation by province of indicators relating to health status, education etc. also highlights
the fact that different indicators tell different stories thus drawing attention to the multiple
dimensions of poverty and the dangers of focusing on single measures of it. For instance while
Badakhshan and Daikundi provinces have high poverty headcount rates (60.1 per cent and 77 per
cent respectively as compared to rural average of 35 per cent) and are thus consumption poor,
female school enrolment figures tell a different story with values (26 per cent and 20.6 per cent
respectively) above or equal to the rural average of 20 per cent. For Daikundi province, the
percentage of births attended by skilled health personnel is 61.5 per cent is substantially better than
rural average of 9.4 per cent. There is not necessarily a correlation between different poverty and
human development indicators.
7.2.3 Efficacy of Recent Interventions

Since the 1990s and particularly since 2001 there have been major investments in Afghanistan to
address humanitarian and development needs. These have had varied impacts upon poverty and its
various indicators, particularly in relation to health and education.
Health – Five years ago, in the immediate post-conflict period, Afghanistan’s health services were
in a deplorable state. Availability and quality of health services was highly variable across provinces
and between urban and rural areas. In early 2002, the Ministry of Public Health (MoPH) and the
major donors developed a Basic Package of Health Services (BPHS) which was contracted to NGOs
by MoPH. Independent evaluations show that the MoPH has made considerable progress in
making the BPHS accessible to most Afghans. Data from World Bank supported BPHS in 13
provinces (USAID and European Commission funding cover much of the rest) point to a significant
improvement in Health Service provision and outcomes but also draw attention to the very low
baseline from which health outcomes and service provision are starting. There is still need for long-
term investment in the government’s ability to deliver and regulate universal health service delivery.
Gender discrimination in access to services is one area necessitating additional attention.
Education – A ‘Back to School’ campaign beginning in 2002 resulted in a striking total of more
than 4.3 million children enrolled in grades 1–12 and 6 million children are now in school, 35 per
cent being girls. However just less than 50 per cent of the school age population remain out
of school with significant gender and provincial disparities. To date, a range of supply-side
issues such as school buildings, teachers (only 22 per cent of teachers meet the minimum
43
qualifications of Grade 14, and only 28 per cent are female47), and curricula are receiving attention,
but demand-related factors have not been systematically examined. For instance, parents may desire
education for both sons and daughters but are constrained by poverty. Research (Mansory, 2007)
confirms that there is more pressure on children from poor and illiterate families to drop out, thus
indicating that gaps in formal educational attainment between poor and rich may widen.
7.2.4 Key Findings

The evidence on the nature and dynamics of poverty in Afghanistan point to a complex and not
necessarily consistent set of dynamics at play. The overall picture is of rising poverty levels and
greater food insecurity. There has been investment in public goods which has had demonstrable
effects, although there is much to be done. The following threats and trends are discernable for the
future.
The need to seek welfare through informal means will persist due to rising and
continuing physical insecurity.
The reliance upon grain purchases rather than production will contribute to rising levels of
consumption poverty levels and food security, at least in the short-term (and likely in the mid-
to-long term).
The overall rise in commodity prices may support agriculture-led growth but the
tensions between that and meeting domestic grain needs are going to increase. If
anything, the divide between the relatively well endowed areas in terms of agro-ecology and
with good market access and the more marginal, often mountainous hinterlands is likely to
increase, causing poverty inequalities to rise.
The nature of and dynamics of poverty are likely to continue to change. Structural
poverty may be reduced but is likely to be geographically and socially differentiated unless
systematic attention is paid to address this. The basis of such differentiation is likely to be
based on inter alia, social identity, location and altitude, access to public goods, market
penetration, cultural values, household demography and migration practices. There is therefore
likely to be increasing differentiation.
7.3 Gender
Over a period of more than two generations of conflict, formal and informal social
institutions in Afghanistan have both replicated and changed patterns of gender-based
disadvantage and inequality. Using the ‘gender’ lens as an analytical tool to examine the formal
and informal processes underlying, and the mechanisms causing, gender inequity in these three
domains, can shed light on the reasons for persistent gender inequality, which in turn affects (and is
affected by) the political economy of the country.
In this regard, four influencing factors have been identified as critical:
Gender-based disadvantage resulting from existing kinship and customary practices;
The impact on gender of the erosion of local livelihoods;
The criminalization of the economy; and,
Insecurity at the hands of armed groups.
These four influences combine together to produce extreme forms of female vulnerability, which
also have significant negative implications for poverty reduction policies. For the vast majority of
women in Afghanistan, vulnerability is most visible in relation to the household, the community, the
market and the state.
47 World Bank, 2008. Project Paper for Proposed Grant to Second Education Quality Improvement Project, Afghanistan. P2
44
Household Level – Concepts of male ‘honour’ or namus48 are critical for gender relations.
They are closely related to the protection of and control over women – as well as to notions of
female modesty and propriety and the ability to provide shelter to women in the domestic sphere.
Many observers from the international community argue that these deep-rooted concepts, whilst
strongly patriarchal, should not be tampered with, as they are in most cases the only form of social
protection available to women and children. They are also politically sensitive.49 The focus of
international development interventions by institutions subscribing to this perspective, has
therefore tended to be on the family or on a complementary model of gender relations, which
assumes that the men of a household will take women’s views and needs into account. However, the
way in which informal institutions interact, and in which traditional norms are interpreted in a
context of conflict, mean that this is not always the case.
Community Level – At the local level, women’s participation in local governance is low.50 The
number of women participating in governance does not honestly reflect their decision-
making power or the extent to which their voice is heard. In access terms, they are excluded
from customary bodies of local governance, dispute settlement and arbitration such as tribal jirgas
or village shuras, which tend to be all-male assemblies. Thus, local norms and institutions limit or
block gender-related change in terms of both access to justice and voice, regardless of the
numerical accomplishments claimed by segments of the international community and the Afghan
government.
The Market – Markets in Afghanistan constitute another spatial and economic location where the
gender-based disadvantages embedded in households and communities, play out, underlining
women’s marginality and vulnerability. Gender, in particular the gendered division of labour, is
a critical component of how Afghanistan’s markets operate. For example, key export
commodities such as carpets, dried fruits, nuts and opium poppies benefit from either
unremunerated or low-paid female labour. Likewise, women’s livestock and post-harvest processing
activities are vital for both subsistence and income-generating activities in rural areas, though they
have not necessarily led to a corresponding level of status within ‘the market’ as an abstract
concept or physical location.51 Policy interventions to address these issues have largely been
confined to the provision of credit through the Microfinance Investment Support Facility for
Afghanistan (MISFA) and capacity-building efforts for female entrepreneurs. However, women
entrepreneurs draw mainly on a narrow range of traditional skills and experience very low
profit margins.52 The growth of a predominantly informal, extensively criminalized economy in
Afghanistan has reinforced male networks of recruitment and patronage. As such, the last potential
outlet for female employment is likely to be the public sector, at least in the short- to medium-
term.
The State – Throughout Afghan history, periods of reforms initiating equality between men and
women have been followed by conservative backlash and curtailment of rights. Even today, gender
issues are at the heart of how ethnically diverse groups identify themselves and relate to control
from the central government. Contestation over women’s rights has featured prominently in
each successive state-building intervention. Recent experience in Afghanistan has shown that
the domination of efforts to mainstream gender can open up new battlefields of contestation
among political factions and between the centre and the periphery. Responses to this
48 According to Edwards (1996) “The concept of namus...signifies those people (especially his wife, mother, sisters, and
daughters), objects (e.g., his rifle), and properties (especially his home, lands and tribal homeland) that a man must defend
in order to preserve his honour.”
49 See Barakat 2004; World Bank 2005.
50 See for example Wordsworth (2008).
51 See Grace 2005.
52 Mercy Corps 2002.
45
ideological/social conflict have been to emphasise Afghan ownership and the engagement of
‘traditional’ structures which are frequently seen as more legitimate than the State, especially at
sub-national level. While such institutions and their legitimacy may usefully be harnessed by the
centre in order to strengthen its institutional credibility, local, traditional and informal practices of
power will ultimately reflect rather than contest women’s marginalisation and the physical, social
and economic insecurity which has historically and contemporarily accompanied it.
7.3.1 Women and Security

The sorts of marginalisation just portrayed have left women not only vulnerable in the abstract but
have resulted in physical violence both within and beyond the context of insurgency and armed
conflict. This has included domestic, public and economically-relevant violence.
Domestic – Although public acts of violence against women are generally frowned upon by Afghan
society, violence in the private realm of the household generally continues to be perceived
as ‘natural’ and a ‘right’ for family males. According to human rights organisations such as
Amnesty International, violence against women in Afghanistan is believed to have reached alarming
levels. However, it is not clear whether the situation is more extreme than in other societies, due to
the complexity and amount of variables involved in the reporting of cases across Afghanistan.
Public – International experience indicates a near-universal correlation between heightened
conflict and insecurity and violence against women.53 During the Jihad period in Afghanistan in the
1980’s and 1990’s, violence against women by non-family members occurred on an unprecedented
scale, beginning with the imprisonment of women on the grounds of political activism during the
Communist period,54 continuing with rape, torture and abduction during the Jihad, and culminating
with Taliban public beatings and executions on various grounds. This has led to a breakdown in
social policing (mostly encoded in systems of ‘honour’) by communities and households. Coping
mechanisms most readily adhered and applied to ‘protect’ women have revolved around
practices restricting female mobility, moving female members to a safer place, enforcing
purdah, early or forced marriages even to strangers, imprisonment or even honour killing
as a last resort.
Economic – The rise of the conflict economy has exacerbated both public and private violence
against women and created new forms of security-related vulnerability, including coercive marriage.
Of specific relevance to the growth of the conflict economy is the increasing evidence
over the past decade of the use of women in payment of opium debts, for example when
traffickers are killed en route to their destinations, with a consequent defaulting on
payment.55 Available evidence indicates that Mujahidin commanders started the practice of
pushing up bride prices and taking multiple wives. Families who refused either had to watch their
daughter be killed, raped, commit suicide, or the entire family had to run away. 56 This practice of
marriage coerced by offers of large sums of money has continued among the rich and powerful in
present-day Afghanistan.
7.3.2 State Absence in Female Insecurity

To date, the state has demonstrated relatively little political will or commitment to
addressing public manifestations of violence against women, from whichever source, and
effective national mechanisms to protect women from violence at any level are absent. The
lack of women within the police or judiciary has allowed this situation to continue. Currently, less
53 Ward & Marsh 2006

54 Emadi 1993
55 Azarbaijani-Modghaddam personal observation in Badakhshan and Herat.
56 Kandiyoti personal observation.
46
than 0.5 per cent of police personnel are women, and female police personnel usually play a minor
support role and are ill-placed to protect or advocate on behalf of women.
At present, there is no coherent state-sponsored approach to the provision of gender-equitable
security where women have a voice in determining the security agenda and where gender is
mainstreamed into security policies to ensure equitable outcomes. None the less, the state has made
some ad hoc efforts to address private violence against women and to make the issue into a public
concern. For example, the MoWA has an arrangement with a number of NGOs to provide shelter for
abused women. The MoWA, with the help of international organizations, has also launched a
campaign on the Elimination of Violence Against Women (EVAW), but the impact of such activities
is difficult to evaluate. Although public outcries concerning violence against women do
occasionally occur, there are very few cases (if any) where state actors have ensured that
the perpetrators of crimes have been tried and punished or where crimes are condemned
by community, religious or political leaders.
Gender tends to be regarded by the state as an ‘add-on’ agenda, with often token
appointments of ministry staff tasked with the issue, under-resourced institutional units and
practical as well as psychological disempowerment of women appointed to address the issue (e.g.
lack of vehicles to attend meetings; social norms around women’s ‘correct’ behaviour in public that
mitigate against active participation in the public sphere, even for a public appointee).
7.3.3 Policies, Institutions and Interventions

At the start of the post-Taliban period, the Bonn Accord of 2001 outlined key goals for the
realisation of enhanced gender equity, including the right to vote in elections, to serve in
government and to be elected to parliament. These goals were formalized in the 2004 Constitution
(Article 22), although the ambiguities associated with the simultaneous deference to sharia
law (Article 3) lead many commentators to question the viability of applying an
international human rights framework in the current Afghan context.
The Constitution of Afghanistan established the Afghanistan Independent Human Rights
Commission (AIHRC) for the purpose of monitoring the observation of human rights in order to
promote their advancement and protection. There is also an office responsible for reporting on
international conventions within the Ministry of Foreign Affairs (MoFA). However, the division of
labour between these institutions has been plagued by conflict, stemming from unclear or
overlapping mandates and personal differences between the government institutions
mandated with promoting and protecting women’s rights.
In addition to internal institutional difficulties, a major challenge for the state in the process of
rebuilding the country is that of incorporating the newly-acquired rights and liberties of women
laid out in these documents, to ensure that government policies conform to international
conventions; followed by the translation of reformed and new policies into practice via legislative
and administrative reforms. Despite the availability of institutional instruments, the state
continues to struggle in service provision to women and girls, in negotiating their emergence
from within families and in protecting them from public and private violence. The Gender Equity
Cross Cutting Strategy (GECCS) within the ANDS provides the basis for addressing and reversing
what the document refers to as ‘women’s historical disadvantage’, but it seems unlikely that an
additional document will have greater effect unless women’s rights can be made more contextually
relevant, more strongly supported within the Afghan State and internationally and more organised.
These are outlined below.
7.3.4 Opportunities and Constraints

Opportunities for change arise when gender mainstreaming is presented in terms of practical
activities and tangible outcomes which encourage buy-in and ownership, rather than merely
47
conveying abstract notions such as found in the Constitution or ANDS. This is particularly relevant
for the Afghan context, where the rules of the game are so skewed against women’s interests
that tangible proof of the benefits of addressing women’s and gender issues take on a
critical importance.
The fact that so many women in the country are poor highlights the urgent need to focus on
practical issues and activities that are going to improve the sorely-needed access to basic services
and livelihoods. At the government level, this has meant service provision ‘following the money’, in
the form of gender-responsive budgeting. At the household and community levels, women are
increasingly being allowed to form groups and participate in public life, provided that there are
obvious, immediate, practical and tangible benefits to be had which can be demonstrated to their
male counterparts. It is therefore critically important that men are empowered to reach an
understanding that gender needs are relevant to, and important for, the betterment of
family and community life. For example, available field evidence57 indicates that men’s groups
are learning that if they send women to complain about an issue, they may get a better hearing
from certain parties, rather than going themselves. This is a positive gender dynamic which can be
exploited and strengthened to give women a stronger role in communities.
The greater the tangible, evident, positive impact that an activity or process can have on
the immediate quality of life, the greater the amount of buy-in that is generated, and the
greater the increase in ownership from male stakeholders. To achieve this win-win outcome,
it is critical to address stakeholder realities at both national and sub-national levels. Neglecting
these merely serves to mask the profound challenges, but also the very real opportunities for
modest, but genuine progress in altering the ‘rules of the game’, at the levels where these play out:
the household; the community, the province and the nation.
7.3.5 Drivers and Blockers of Change

In Afghanistan, women’s status has always been negotiated between individuals or small
groups. The institutionalisation of this issue consequently poses problems of relative political
bargaining power, prevailing institutional realities, lack of understanding of the issue and a delicate
bargaining process of multiple (and often conflicting) interests. In this regard, it is important to note
the interrelationships between the various levels and how the drivers and blockers at each level (as
illustrated in Table 3 and discussed further in the Gender Inequality Final Report) impact each of
those at the other levels. This highlights the need for better communication strategies so that
effective and stronger linkages can be cemented across and between the various levels.
Table 3. Drivers and Blockers of Gender Transformation in Afghanistan
Drivers Blockers
General: General:
Moderate elements at all levels; Women as symbols of honour and namus
Donors, especially those pushing gender but only when convenient to male
budgeting; interests;
Accelerated provision of access to No effective national women’s

Information and Communication movement;
Technologies (ICTs); and, Conservative elements and their
Islamic feminists in the region: gender- corresponding conservative
interpretations of Islam at all levels
57 Azarbaijani-Moghaddam 2006
48
friendly interpretations of Islamic texts. including the oppression of women as

tool for consolidation of Islamic
credentials;
Contrast between abstract notions of
gender equity and women’s rights and
those processes which lead to tangible
outcomes benefiting men and women;
Women’s issues held hostage to rivalry
and in-fighting over ethnicity,
factionalism and access to funding;
Women’s labour invisible, not monetised
and exploited; and,
Culture of impunity related to public and
private violence against women.
State: State:
Women in political fora; Few sympathetic, influential, and
MoWA and DoWAs – provided that skills powerful women at policy-making level;
and capacity to effectively design, No responsibility given to sub-national
develop and manage gender issues and governance bodies to improve HDIs for
activities can be built in; women and girls;
MoF by earmarking money for gender Ministries which isolate units and
activities through specific gender individuals working on gender related
budgeting activities; issues. Other ministries which window
Ministers pursuing specific and dress their activities around gender issues
coordinated gender equality issues; for funding purposes;
Better consideration and awareness of Parliament, Supreme Court and political

gendered disadvantages in the supply of factions hold government ransom over
service provision; and, gender issues; and,
Compliance with international standard Rapprochement with Taliban or Hizb-e

setting instruments. Islami thus providing government with
less incentive to pursue a gender
mainstreaming agenda.
Community and Civil Society: Community and Civil Society:

Women’s organizations and institutions Civil society organizations and others
provided they can overcome tendencies using women and gender related issues
to engage in rivalry and turf protection in as bargaining chip to access funding;
order to form a coherent and capable Women’s organizations formed simply to
women’s movement; attract funding;
Civil society groups run by men and Absence of issue and interest based
women negotiating and demanding women’s grassroots organizations; and,
improved gendered access to services;
and, Provocative role models in media, who
use their positions and influence to
Appropriate role models in media. heighten tensions around gender
stereotypes, creating further resistance to
changes.
49
Household: Household:
Better access to basic services, especially Women as extensions of factions or
education for girls; families;
Women inheriting land and property and Lack of access and education regarding
controlling productive assets; and, the use of contraception and family
Access to formal credit. planning;
Lack of access to basic services such as
education, credit, and health; and,
Women unable to inherit land and other
assets.
A number of lessons learned emerge from the examination of opportunities. These include:
Avoiding the creation of situations where the international community is perceived as
forcing an agenda and or the pace of its development;
Placing increased emphasis on building understanding in the MoWA and other
relevant gender activists on how the national budget works, together with building
capacity around the appropriate analytical skills required to address gender, across ministries
and in activist groups;
Identifying change agents within both government and informal groups, who understand
(or can be empowered to understand) the logic of gender mainstreaming and are committed to
the initiative; and,
Identifying opportunities to raise gender issues with potential champions of change
at sub-national level, in order to strengthen local-level planning processes: for example,
ensuring that budgeting for gender-related activities goes hand-in-hand with good
governance initiatives and practices.
7.4 Other Forms of Social Exclusion

Several additional forms of social exclusion, in addition to and overlapping with poverty and gender,
exist within Afghanistan. These include:
Social exclusion on the basis of social identity: Kuchis and gypsies, religious minorities,
women (especially female headed households (FHHs) and dishonoured women such as
prostitutes), young people and children (especially orphans, working children and street
children)
Social exclusion on the basis of location: residents of remote and inaccessible areas, residents
of insecure areas which are the scenes of active conflict
Social exclusion on the basis of social status: the disabled and handicapped (both physical
and mental), the chronically poor (rural and urban), IDPs and returnees.
While it is not possible to examine the historical, social, political and economic causes of exclusion
affecting each of these groups, an overview is provided below.
7.4.1 The Disabled

Past and ongoing conflict in Afghanistan has resulted in high levels of physical and
mental disability. The National Disability Survey conducted by Handicap International (2006)
estimated that 8 per cent of Afghans are disabled. This figure can be subdivided among those with
physical disabilities (36.5 per cent), sensory disabilities (25.5 per cent) and mental disabilities (9.7
per cent). The remainder may have other forms or multiple disabilities (9.4 per cent).
In relation to the scale of the issue, formal welfare provision has been very limited. Currently the
50
Ministry of Labour, Social Affairs, Martyrs and Disabled (MoLSAMD) covers war and mine disabled
but cannot provide assistance to those disabled at birth or due to illness or accidents. A National
Policy Framework for Action for Persons with Disability has recently emerged as a result of policy
initiatives supported by strong international NGOs. In addition, a disability law is awaiting approval
by the National Assembly, and there is a national action plan to mainstream disability in the
ministries.
7.4.2 Female-Headed Households

It is clear that widows and female heads of household (FHHs), together with their children, are often
neglected, unprotected by the law and customarily prohibited from participating in public affairs. It
is estimated that there are around 40,000 widows in Kabul, though the number of FHHs across
Afghanistan is unknown. Apart from existing widows and FHHs, for instance, every caseload of
returnees includes women whose husbands died, disappeared or are in prison abroad, while ongoing
conflict and insecurity has also added to the number of widows (and orphans).
Loss of family males on a permanent or temporary basis constitutes a shock which can have chronic
long-term impacts not only on the women but also on the children in their care. Such households
may become more exposed to predatory behaviour, suffering and personal insecurity,
losing both coping mechanisms and informal rights (which provide a certain degree of
paternalistic protection for most women). Discussions with implementers show that widows
and their children are extremely vulnerable to abuse from their families, local leaders, communities,
employers and criminal groups.
There is very little formal assistance for such groups. The caseload is scattered across ministries.
MoLSAMD provides a pension for the widows of martyrs although this often has to be
‘negotiated’ through gatekeepers. Achievement of related MDGs and ANDS goals regarding FHHs
is only possible through the mediation of donors, UN agencies and NGOs. Furthermore, low social
status means that FHHs are often intimidated by formal institutions and, as such, have not
organised to press their rights and needs. Both the Ministry of Women’s Affairs (MoWA) and female
members of the National Assembly have failed to achieve substantive policy or legal gains for FHHs.
7.4.3 Youth
Over half of the Afghan population is estimated to be below the age of 19 which makes youth an
important sub-set when dealing with poverty, social exclusion and gender.58 While additional
research into the position of Afghanistan’s youth is necessary, global examples indicate that
economic pressures in post-conflict societies, including contemporary Afghanistan, lead
adults to force children to leave school and take up labour at an early age. Doing so
provides temporary economic benefits but is widely seen as limiting longer-term individual and
familial well-being. This trend in turn leads to the intergenerational transmission of poverty.
Such issues are often ignored as youth in Afghanistan have no dedicated policies specifically
addressing their welfare. Responsibility for youth is spread across a number of ministries and
institutions. The MoLSAMD recognizes around twenty types of vulnerability in relation to children in
Afghanistan and has prepared a National Strategy for Children at Risk with UNICEF and has recently
established a Children’s Secretariat59, as part of the ANDS Social Protection Strategy. Planning and
programming, however, are slow to follow such high-profile but minimally effectual steps.
Lack of attention to youth issues together with a youth bulge in the population can be a potent
mix. Urdal (2004) tested claims that youth bulges – extraordinary large youth cohorts relative to the
58 The figure given was 59.33 per cent in UNFPA Afghanistan – A Socioeconomic and Demographic Profile and Household
Listing 2003-2005
59 The Deputy Minister for MoLSAMD is the chair of the SAARC Committee for Children.
51
adult population – may be causally linked to internal armed conflict. Youth bulges, according to the
results of Urdal’s study, are believed to strain social institutions such as the labour market and the
educational system, thereby causing grievances that may contribute to violent conflict. This
dynamic was deemed particularly likely under conditions of economic stagnation such as exist in
present-day Afghanistan.
7.5 Constraints to Social Inclusion

There are several blockers to progress towards social inclusion. While it is not possible to list each –
which are discussed further in the three Poverty, Gender and Social Exclusion Analysis reports –
several apply to nearly all cases of marginalisation. First, the lack of tangible linkages between
social inclusion and security has made the concerns of marginalised populations a relatively low
priority. Second, the Afghan government and segments of the international community
have been unwilling to push for the inclusion of marginalised groups, particularly women,
given the perception that cultural change (rather than the manner in which it is pursued) is a
critical source of conflict vulnerability which will lead to an expanded insurgency. Third, the
Afghan government’s administrative weakness and the desire of all ministries to access
international funding by including a prominently displayed but tangibly meagre component for
marginalised groups has led to the diffusion of responsibility and benefits. Fourth, those benefits
which do exist are often mediated by gatekeepers, some within and some beyond the State.
Public officials and commanders were both reported to have extorted financial assistance provided,
for instance, to physically disabled individuals. Fifth, the stigma surrounding many forms of
marginalisation, or the marginalisation itself, prevents them from pressing their rights in a
vocal and coordinated manner with the international community, the media or the State.
These factors require attention from DFID and HMG in a conflict-sensitive manner and would be
best addressed through increased investment in health, education and at least minimal social safety
nets. In many cases, the lack of such services prevents individuals from being able to emerge from
poverty or overcome entrenched forms of exclusion. Furthermore, the public sector’s ability to
recognise the distinct needs of marginalised groups and to develop strategies for meeting them
should be included, where relevant, in governmental capacity building.
52
8. Strategies and Options

While the previous sections have focused upon analysis, ‘Understanding Afghanistan’ was primarily
directed at the formulation of concrete suggestions for improving security, strengthening the State,
growing the economy and including the excluded. There are more than fifty individual
recommendations and options discussed within the full reports of the ‘Understanding
Afghanistan’ initiative. Rather than attempting to discuss each within this Synthesis Report,
those which are deemed the most critical or which were highlighted within several of the
component reports are included here.
8.1 The Grand Bargain

Both the Political Economy Analysis and the Strategic Conflict Assessment teams arrived upon the
same conclusion – that there can be little lasting security or development in Afghanistan
without a ‘grand bargain’ including the incorporation of the Taliban and all other key
stakeholders into the Afghan government. Doing so must, however, be done carefully. The
international community must allow a highly credible Afghan figure, whether a post-Karzai60
president or a respected Pashtun religious or political figure, to initiate and direct all overtures
between the government and the Taliban (and its affiliated insurgent groups). International
involvement in the process will irreparably taint it and could lead to its collapse. Second the process
must achieve the buy-in of the Afghan political establishment with its range of vested interests,
many of whom may be opposed to sharing power (which may be widely perceived as losing power).
In the absence of such an agreement, the Taliban-led insurgency has no viable alternative
but to either topple the current regime or to carve out vast portions of the Afghan
countryside which will be beyond the control of the State. The Political Economy Analysis
provides additional recommendations for progressively increasing political dialogue and
participation in advance of any negotiations with the Taliban, while the Strategic Conflict
Assessment lays out a wide variety of approaches for winning the (potentially reluctant) support of
key stakeholders in Afghanistan and beyond through public diplomacy, economic development and
a wide variety of other interventions. This latter report also highlights the need to focus upon
national dialogue and political negotiation alongside community-based ‘peace building’ measures
and dispute-resolution forums, which include the State, to (i) strengthen non-violent responses to
conflict and (ii) combat local power-sharing conflicts which, as previously noted, may encapsulate
up to half of all ‘anti-government’ attacks.
8.2 Combating Conflict

It is anticipated that a ‘grand bargain’ will lead to a significant decline in the level of conflict within
Afghanistan. However, while assisting the Afghan government in the pursuit of this goal, several
additional steps can be taken to mitigate insurgent recruitment and intra-state, regional tensions.
8.2.1 Utilise Public Diplomacy to Counter Insurgency

Her Majesty’s Government, particularly the Foreign and Commonwealth Office (FCO), should support
large-scale public diplomacy efforts throughout Afghanistan which work through traditional
structures and avoid the mistakes of previous culturally inappropriate or obscure attempts.
In Afghanistan’s poorest areas which are the areas with greatest illiteracy, message passing is
often carried out through the religious community. Friday prayers and the mullahs and imams
are often the bearers of the insurgent message and the motivators of resistance. It is therefore
60 President Karzai, somewhat discredited in the eyes of many Afghans and much of the international community, may no
longer possess the clout to successfully initiate or complete a ‘grand bargain’ with the Taliban while maintaining the loyalty
of armed groups in northern Afghanistan.
53
important that clerics of all types are part of the process which persuades people not to support the
insurgency. A correctly structured message delivered in this way is essential. But so too is the
follow-up. This is where development connects with counter-insurgency. ‘Fast track’ development
projects to meet local needs are not only essential once an area is taken over by
government and international forces but also are integral in preventing the loss of the
territory gained. The failure to deliver improvements in infrastructure and quality of life means
that messages concerning the good will of the international community will be lost.
8.2.2 Focus Sustained Assistance on ‘Angry, Young Men’

The provision of extensive agriculture and livelihood support will go a long way to
reducing ‘angry, young men’s’ interest in joining armed groups such as the Taliban or re-
mobilising northern militias. Targeting such opportunities for young men will do the greatest
damage to insurgent recruitment, as will programmes designed to provide young men with
vocational and educational training (VET). International assistance flowing to long-standing stable
and newly secured areas will prevent them from effective Taliban and other insurgent infiltration. To
provide assistance in the estimated 50 per cent of the country which is inaccessible to civilian
reconstruction and development organisations, several options are available, including the increased
use of Islamic organisations and countries as assistance providers and the provision of assistance
directly to communities.
8.2.3 Minimise Intra-State, Regional Tensions

Divisions between groups, particularly between northern and southern armed groups,
should not be inflamed in order to prevent large-scale, intra-state conflict. First, assistance
should be provided – and perceived as being provided – in equal levels to Pashtun and non-Pashtun
areas. Second, further disarmament of illegal armed groups (DIAG) should not be pursued in the
North until stability has been achieved. Third, proposals concerning a cross-border Pashtun
autonomous zone between Afghanistan and Pakistan should be viewed with intense scepticism.
Doing so would be likely to inflame regional tensions and provoke re-mobilisation in the North.
8.2.3.1 Counter-Act ‘Perverse Incentives’

One recent development is the perception of a ‘perverse incentive’ whereby assistance is
provided in the greatest amounts to insecure areas or areas which have recently become
secure. By comparison, locations with little insurgent activity may receive relatively little assistance.
Elected officials and rural community members alike have noted this trend in northern Afghanistan,
the Hazarajat and in scattered stable communities in otherwise insecure regions. Accordingly, these
individuals have concluded that violence is necessary to attract reconstruction assistance and that,
as such, they should engage in or permit insurgents or other armed groups to engage in attacks
within their regions. Such conclusions could lead to Taliban expansion into currently secure areas
(though these comments should also be interpreted as posturing and attempts to maximise
assistance received).
8.2.3.2 Avoid Mobilisation of Militias for Counter-Insurgency Operations

Community self-defence programmes should be approached with great caution. Previous
attempts to mobilise communities in pursuit of their own defence, by the PDPA and Soviets in 1979
and 1980, laid the basis for the Mujahidin, and the recent Afghan National Auxiliary Police (ANAP),
which was quickly co-opted by the Taliban.
Current proposals, particularly the Independent Directorate for Local Governance’s (IDLG) Afghan
Social Outreach Programme (ASOP), are better designed given that they will not provide weapons,
training or uniforms and given that they are intended to be overseen by specifically-created shuras
comprised of the most respected individuals. That said, the oversight mechanisms lack punitive
powers, and the potential for the defection of State-financed militias to the insurgency is
54
commonly perceived as high if not nearly certain. Perhaps most worryingly, community-self
defence will, by necessity, be rolled out in locations with the greatest insecurity which is
focused in the predominantly Pashtun South and East. As such, it will be viewed as a direct
challenge to the non-Pashtun North, in particular, and would be almost certain to lead them to
dramatically the remobilisation and re-armament of their minimally demobilised militias.
8.3 Governance
While the ‘grand bargain’ remains the lynchpin for building effective governance in Afghanistan,
the ongoing ‘collaborative governance’ between the Afghan government and the
international community must also be strengthened in a manner that meets the interests
of both. While individual suggestions for doing so are identified below, a basic conceptual shift
must occur where by international actors realise that their primary security-oriented aims are best
pursued by listening and responding to the stated interests and goals of the Afghan government
and people. Doing so will require ceding control over the reconstruction process to Afghans and
ensuring that local priorities such as livelihoods are valued more than Western goals of counter-
narcotics. Once this shift is widely achieved, the remainder of the agenda becomes clearer.
8.3.1 (Re) Mobilising Legitimacy

Both the Strategic Conflict Assessment and the Growth Diagnostic highlighted the need to more
fully engage the State not only in financial management but also in the allocation and oversight of
reconstruction initiatives. Ensuring that assistance is seen as coming from the government is
critical in building the State’s legitimacy, and enhanced governmental involvement will allow public
sector personnel to gain necessary capacities.
Mobilising legitimacy will also involve the devolution of power and authority from the Executive
(and the international community) to, most notably, the National Assembly and the Ministry of
Defence. The marginalisation of the National Assembly has helped contribute to national
fragmentation and has prevented dialogue. Its exclusion from the reconstruction process has,
most notably, led it to become a body centred around criticising actions taken without their
engagement or approval. Similarly, the ‘Comprehensive Approach’, with its emphasis on more closely
integrating the Afghan Ministry of Defence with NATO/ISAF troops and the US Operation Enduring
Freedom (OEF), is also significant on both practical and symbolic levels. Doing so will demonstrate
the international military’s growing confidence in the Afghan government and armed forces to
maintain security and will, at least, serve to bolster Afghans’ pride in their primary symbol of
national unity, the ANA.
8.3.2 Improve Anti-Corruption Measures

Providing the State with increased responsibility for reconstruction should be accompanied by
improved and strengthened anti-corruption measures as have been pursued through Public
Financial Management (PFM) reforms. They could involve, as various ‘Understanding Afghanistan’
reports suggested, forming an elite and well paid anti-corruption unit with broad powers
(and extensive oversight) in the government. Still others, particularly those engaged in the
Growth Diagnostic, suggested a complementary bottom-up approach whereby community leaders
are able to report corruption while receiving some form of protection from identification and/or
retribution. Public awareness would be a critical component of such an approach. Alternatively, as in
the disarmament process, social pressure could be brought to bear by traditional leaders and
councils against public officials who engage in rent-seeking behaviour. The Taliban’s
emphasis on regular rotating staff members is a viable suggestion, particularly once core capacities
have been achieved among the public administration, and an emphasis on the high-profile
prosecution of violators could set a positive national example.
55
8.3.3 Reform the ANA and ANP

Significant reforms are also necessary among the ANA and, in particular, the ANP. Within both the
ANA and the ANP, pay and rank systems should be – as they currently are being – restructured, and
merit should replace nepotism as the basis for promotion. The current process of pay and rank
reform, launched in 2006, has borne some fruit at the senior-most level in the police, but at the
lowest levels, there is strong evidence that it has been compromised in the face of corruption and
factional pressure.
Furthermore, corrupt elements within the police should be tackled from the top down,
and oversight structures should be strengthened. Initially, high-level reform of the ANP and the
MoI and the use of the Focused District Development Programme (FDDP), which draws upon a
combination of ANP training and the temporary replacement of regular police officers with the
highly professional Afghan National Civil Order Police (ANCOP) in hopes of improve community-
level anti-corruption efforts, should be vigorously pursued. In the mid- to long-term, however, it
will be necessary to re-consider the role and structure of the ANP. To better meet the demands of
the security situation without depriving the police of a community policing orientation, the force
should be restructured and endowed with a robust Gendarmerie or paramilitary component. This
would permit the institution of a division of labour in which some police receive specialized
paramilitary training and contribute to the counter-insurgency while others receive standard police
training and assume regular police duties. The monitoring of ANP community policing through
local governance bodies would be one manner in which corruption could partly be
addressed. Furthermore, a police ombudsmen’s office should be created, but situated outside the
MOI to insulate it from intimidation and corruption. It should be given wide powers and significant
resources that would allow it to investigate abuses and allegations of corruption across the country.
It should work closely with both the Internal Affairs police of the MoI and the Attorney General.
8.3.4 De-Centralise the State

Currently Afghanistan remains one of the most highly centralised democracies in the world. Doing
so allowed the international community to interact with a single and geographically focused set of
stakeholders in ministries and the Executive. However, this situation – and the failure to pursue a
federal model – has also alienated the periphery from the centre. Those sub-national structures
which do exist are commonly lacking clear duties and oversight, and little has been done to connect
community-based organisations (CBOs) such as the Community Development Councils (CDCs)
established under the National Solidarity Programme (NSP) with the State. Fostering a
transparent, purposeful and decentralised public administration – initially to be focused
exclusively upon transparent, locally-accountable service delivery in collaboration with
CBOs, traditional councils and leaders and other low-level stakeholders – will do a great
deal to build the State’s legitimacy and counter the fragmentation which is currently
taking place. Once this initial achievement is reached in the coming several years, the
decentralisation of decision-making and resource-mobilising functions may be considered.
8.3.5 Increase Revenue Mobilisation and Limit Expenditure

The aforementioned recommendations – increased state legitimacy, anti-corruption and
decentralisation – would have the net effect of promoting revenue mobilisation. Doing so should be
combined with a more transparent and government-owned process of security sector expenditure.
Furthermore, the international community should seriously consider the long-term viability of the
expansion of the Afghan National Army (ANA) to 120,000 troops. Such an expansion may not be
financially sustainable, and its short-term security impact would be blunted by the lengthy amount
of time necessary to more than double the current force (which is more than 6 years in the making).
Regardless of decisions concerning the size of the ANA, it will be necessary to ensure an open,
transparent and increasingly government-owned process for allocating expenditures in the
56
security sector. The multi-donor Law and Order Trust Fund for Afghanistan (LOTFA) provides one
viable model, though many involved in ‘Understanding Afghanistan’ would prefer the use of entirely
government-controlled mechanisms within the Ministry of Finance (MoF). That said, the
international community and Afghan government cannot take sole responsibility for mobilising and
allocating resources. A large segment of the ‘Understanding Afghanistan’ team, particularly from
within the Strategic Conflict Assessment and Growth Diagnostic, also advocated for the inclusion
of a bottom-up, community-driven approach whereby revenues are not only mobilised
nationally for security provision but also for tangible community-improvement projects.
Such an approach, utilised effectively within the NSP showed that communities are willing to pay
for public improvements and services but only when secure in the knowledge that they will receive
most of the benefits of what they contribute.
8.4 Economic Development

Several recommendations for improving Afghanistan’s economic development are also made
throughout nearly every report, from those focused upon short-term gains and stabilisation to
those considering Afghanistan’s long-term niche in the global marketplace and the needs of
marginalised groups. Several of these are accompanied by specific suggestions for supporting
agriculture and traditional sectors such as carpets (see the Growth Diagnostic Policy Discussion
Report). That said, it is critical to realise that any reforms in economic governance will
require the establishment of a governmental entity charged with the formation, analysis
and implementation of economic policy.
8.4.1 Prioritise the Battle Against Nuisance Taxes and Corruption

The persistence of nuisance taxes and bureaucratic obstruction reflects the relatively weak and
uneven attention given to the promotion of private sector driven growth as a key government aim
across and within different ministries. A greater degree of oversight of the different hurdles
that affect the private sector in its engagement with government is required in order to
expose and eliminate inappropriate taxes and bureaucratic requirements. This is not only an
issue of tax policy alone, but largely one of weak administrative oversight and weak compliance.
The government’s stated aim of reforming complex structures and functions of government will
remove opportunities for corruption as well as reducing the bureaucratic burden upon the private
sector. For the private sector, the introduction of more and better auditing and monitoring could
have some effect, including a reliable system for recording corruption, where it is encountered.
Finally, the identification of corruption at high levels within government requires the
exemplary action against high level corruption, including the sacking of corrupt officials.
The following specific recommendations were also made within the Growth Diagnostic Scoping
Study:
The Roadmap for Strategy and Action to fight corruption proposed by the joint donor
community should be implemented. The donor community should recognize that it is as much
part of the solution as it is part of the problem. The same transparency levels the international
community demands the Afghan government to practice should be as well practiced by donors
and NGOs.
The endogenous corruption should be limited by cutting red tape, concentrating all licenses
and permits into a one-stop-shop model and empowering one single autonomous revenue
authority.
The Anti-Corruption Unit must be strengthened with a clear mandate, an independent
budget and high-level political support. Every effort should be made to ensure that this entity
is insulated from political pressures and considerations.
Prevention and awareness are two other key components of any anti-corruption campaign.
The international community should support such projects in order to inform ordinary Afghans
57
of their rights vis-à-vis rent-seeking behaviour. It is also recommended that the international
community improve its own policies and practices towards corruption, as its willingness to pay
bribes and submit to unofficial permit and licensing costs has undercut broader anti-
corruption efforts.
8.4.2 Take Early Action to Protect Business from Crime and Insecurity
The specific threats to business need to be acknowledged, alongside and not after the broader
challenge posed by the insurgency has been addressed. Without security for business, the type
of growth necessary to discourage Taliban recruitment will not be possible. The Afghan
government has yet to provide an adequate response to this escalating threat to the business
community and there are few examples of successful and transparent prosecutions of kidnappers. A
delegation of businessmen has asked the President to establish a special court to try kidnapers. A
response is required even if only to recognise the seriousness of these threats to the private sector.
While developing a broader strategy, emergency measures to protect business may be worth
considering, such as the proposal made recently by the EPAA to the Afghanistan Investment Climate
Facility (AICF) for the piloting of a 24 hour hotline for exporters moving goods by road. The hotline
could allow exporters whose trucks are illegally stopped and asked for payment to access unarmed
mobile teams, stationed in cities along the major export routes, which could attend the scene if
necessary. A database of the frequency and types of illegal roadside payments could then be
presented to government. The AICF is an appropriate organisation to pioneer and fund measures for
protecting business from kidnap and extortion, and DFID, as in Sudan, may by the appropriate
organisation to support a National Risk and Threat Assessment at the district level in order to better
understand micro-economic risks.
8.4.3 Increase Vision, Coherence and Consistency of Policy

There is a need to bring together government actors from all relevant ministries and agencies, to
discuss with private sector representatives strategies for growth, investment and export, including a
clear outline of those reforms and interventions that require prioritisation. Discussions should be
pro-active and not reactive and must result in a plan of action which stakeholders can monitor.
However, for this to be a meaningful exercise, donors need to convince Afghan actors of the
desirability of their policy preferences, from trade to privatisation: to ‘win the hearts and
minds’ over economic directions for Afghanistan. Donors will retain the strong leverage on
policy directions that Afghanistan’s dependency on aid and credit brings, but using this leverage at
the expense of Afghan ownership will have a cost in terms of policy implementation.
Consistency and coherence of the message being sent out by donors through technical assistance
and other programmes is also vital in convincing Afghan actors over appropriate directions of
economic policy. A number of programmes have sent out contradictory messages to Afghan
observers. For example, whilst donors resist trade protection or the officially sanctioned notion of
subsidising fledgling industries, a number of donor funded programmes, notably in the sphere of
alternative livelihoods, have amounted to the subsidy of certain types of production on the ground.
In debating a vision and a strategy for private sector investment and growth, the donor community
also needs to strengthen the trajectory and consistency of its argumentation.
8.4.4 Concentrate on Durable Systems, Not Personalities

As far as possible, donors should be supporting the establishment of durable systems and processes
within ministries, in the hope that these can both influence a difficult reform environment and
outlast the tenure of a pro-reform minister. Durable processes can be supported by properly
targeted technical assistance, providing tools and resources and working structures that
are tied to a specifically identified need as well as to the overall PSD strategy and which
can be easily handed over to Afghan civil servants. Changing political culture, however, is a
slow process, and engagement with Afghan elites, even those involved in misuse of government
58
resources or state capture, is vital. Nonetheless, donors should try to be cognisant of who the large
political-economic interest groups are and how programmes supporting the private sector can be
made independent of such interest groups. Corporate governance and responsibility should be firmly
integrated into the wider governance agenda in Afghanistan. Interventions targeted at SMEs may
help to boost this sector amidst an uneven playing field.
8.4.5 Foster Special Economic Zones

To overcome business uncertainty concerns as identified by the Growth Diagnostic, special
economic zones (similar to the industrial parks, perhaps even free zones) where a five-to-
ten-year tax holiday could be provided for companies willing to formalise their businesses.
Such zones would benefit from full access to basic business services and could also benefit from the
recent public sector leasing of land. Thus, they could help circumnavigate poor protection of
property rights by guaranteeing security of asset within their boundaries. The idea of scaling up
investment parks has been often repeated, in spite of the questionable success of investment parks
so far in Afghanistan, due in part to confusion over the division of responsibility for the parks
between AISA and the Ministry of Commerce and Industry (MoCI). Given a clear strategy and clarity
of leadership, investment parks could provide a key opportunity to generate some good news stories
in the small and medium enterprise sector.
8.4.6 Address Infrastructure Weaknesses

With weak infrastructure highlighted as the second most binding constraint to economic growth,
and against a background of high external infrastructure financing since 2001, identifying the
infrastructure needs of high potential economic sub-sectors is more important than ever. With each
sub-sector demonstrating different infrastructure requirements, public investment will need to be
far clearer on which sub-sectors are to be supported and to which markets such production is to be
exported. Of particular policy significance, given government’s weak capacity to maintain
large infrastructure, will be increased infrastructure investments at the community and
village level (access to electricity, processing and marketing infrastructure, etc.), an area
of investment that has shown great success in countries such as Thailand and Bangladesh.
In addition to small to medium sized infrastructure, lack of storage and integrated value-chain
structures appear major policy shortfalls when viewed as a percentage of public investment. At
present, the current focus on building public, not private, infrastructure might usefully be
strengthened by established viable public private partnership arrangements through the
establishments of special purpose entities, perhaps working closely with the EPAA, and MoCI.
8.4.7 Develop Value Chains

As was previously discussed in Section 6 of this report, there is a vital need to improve value
chains and associated infrastructure to ensure that Afghans receive the full potential
profits from production. Doing so will involve the creation not only of necessary infrastructure,
such as roads, processing and cold-storage facilities, but also the pursuit of markets for value-added
products. The continued development of western China provides an exciting opportunity, as does
Russia (though inter-state trade through the former Soviet Central Asian Republics, which have
economies similar to Afghanistan may prove overly burdensome).
One source of information and inspiration for the development of value chains in Afghanistan is the
poppy cultivation and narcotics trafficking industry. It has developed one of the most highly
sophisticated and effective approaches to credit provision, cultivation, sale, transportation,
processing and distribution within Afghanistan’s agriculture sector.
8.4.8 Build Human Capital

While many of Afghanistan’s current businesses may not require technical capabilities, future
59
businesses (in addition to the public sector) will require well educated and highly skilled personnel.
This process – which should have begun in earnest in early 2002 – must begin now if
Afghanistan is to be prepared to continue developing ten years from now. Institutions of
higher education, potentially more so than even basic vocational training centres, should be made a
high priority, particularly as their development has been seriously neglected in the rush to raise
rates of primary education.
8.4.9 Discourage Poppy Eradication

A distinction must be made between the impoverished farmer and the well-armed traffickers and
their political protectors. The latter two groups receive the vast majority of profits from narcotics
and use it to bribe public officials, corrupt segments of the security service, support private militias
and attempt to limit the territorial extension of State control. With this distinction in mind, the
importance of stopping the traffickers while not, necessarily, preventing the production and growth
of poppy cultivation becomes the only logical and humane solution. Eradication, which does not
have the domestic or international political support to be widely implemented, will only
push cultivation from province to province, leaving a trail of insecurity in its wake, and
raise the value of the opium poppies produced. Furthermore, it will lead to increased poverty
and to widespread hatred and resentment of international forces and their Afghan government
host, as it has already done. Furthermore, given that the majority of Afghanistan’s credit sector is
rooted in income derived from poppy cultivation and narcotics trafficking, engaging in or
allowing international partners to engage in poppy eradication could lead to wider-than-
anticipated economic results.
8.4.9.1 Promote Public Integrity through Counter-Narcotics

Poppy trafficking networks should be tackled, in the short-term, through increased interdiction
alongside borders and in neighbouring countries. Well equipped, highly trained and generously paid
border guards both within Afghanistan and its neighbours should be created with international
assistance. The target of interdiction should, however, not solely be the poppies and opiates
but also the precursor chemicals which are necessary for processing. By closely tracking the
sale and transport of these chemicals, the international community and Afghan government could
provide an ideal solution in which cultivators continue to receive payment for the raw product while
the organised criminal networks will be unable to add value. As such, processing will continue, as it
previously had, to be done outside of Afghanistan, thus leaving far fewer profits in the country to
finance violence and, in particular, to undermine the State through the co-optation of public
officials.
8.5 Poverty Reduction

The following recommendations are made by the authors of the ‘Understanding Afghanistan’ report
concerning poverty.
Invest in Public Goods. There is a strong case to be made for supporting the Afghan government
by investing in public goods as a means to address widespread structural poverty. This is likely to
address the needs of many households in Afghanistan and have general benefit with respect to
poverty reduction. The focus should be on health and education in particular and in a support of
processes which focus on building the capacity of the Afghan state in health and education service
delivery.
Supporting Social Protection Mechanisms. Given state weakness and the capacity of the
informal sphere, ‘customary’ mechanisms should be supported so that the poor can reduce the
discount on the future. Such measures must be rooted in an understanding of and improvement in
informal security mechanisms.
Address Poverty Inequalities. Poverty inequalities based on social identity (specifically gender)
60
and other structural reasons will not be addressed unless they are systematically analysed and
responded to. There is a danger that structural determinants of these inequalities, particularly where
they are socially or politically based (e.g. cultural prescriptions endorsing gender inequality) will
simply be treated as disadvantages and the underlying causes not addressed.
Improve Poverty Targeting. A focus on public goods, social protection and poverty inequalities
will all require some degree of targeting, from the decision not to target to targeting based on
poverty assessments, self-targeting and targeting based on categorical or geographical
characteristics.
Better Understand Poverty. Effort is required at a minimum not only to improve the country level
cross-sectional metric assessments of consumption or income poverty but to build systematically
and link it with more qualitative and socially informed understanding. This requires multi-level
qualitative-quantitative studies (not just Q2) which include analysis of household trajectories. This
in turn highlights the importance of building the capacity of government institutions to collect,
collate and analyse quantitative and qualitative data in order to formulate appropriate policies and
programmes to address poverty.
8.6 Gender and Women’s Empowerment

The following recommendations are made within the Gender Inequality Final Report.
Adopt an Incremental Approach. The findings of this report lead to the recommendation that
DFID adopt a step by step, ‘building block’ approach to achieve sustainable gender-related change,
whilst continuing to support the bigger picture at the policy level, including in order to influence
the way it unfolds, to build institutional capacity, and to monitor policy implementation, as well as
increasing the accountability of key stakeholders.
Increase Women’s Voice and Agency. At present, women’s political representation must be
heavily moderated by men at all levels with very little effective transfer of power to women. What is
required is a more detailed analysis on the various intra-family dynamics, negotiations and power
transfers which can lead to the win-win situation of males retaining ‘face’ while women participate
in public life. The gradual scaling up of such dynamics could transform gender relations
within Afghan communities and lead to sustainable gains. Specific examples for how to do so
are offered in the Gender Inequality Final Report.
Support Gender-Equitable Economic Growth Policies. At the policy level, DFID should
encourage the development of improved design, content and market relevance of women’s
skill-building and income generation programmes, whilst recognising the evidence on the
existing constraints faced by women in terms of participation. Further research and analysis of
women’s role in the informal economy could support this approach, including on how it impacts on
women’s livelihood options; the impact of the criminalisation of the economy on women and girls;
and how the latter, combined with the erosion of local livelihoods, impacts gender equitable
outcomes. At the programme level, DFID should support initiatives by government and civil society
that promote equitable access to productive assets, including inheritance.
Begin Supporting Health and Education. Investment in education would enable DFID to
prioritise issues of equal access for girls and boys. Specific areas of recommended intervention
would address issues of both quality and access. These include: curriculum quality, the number
of female teachers, girls’ secondary school attendance and, through education, the number of
trained female health care professionals (with expertise on female health needs). Investments by
DFID in the health sector could similarly help address the challenge of increasing health service
usage by women. This is not just an issue of physical access. Even where health facilities exist, and
are near women’s homes, only one quarter of women use skilled birth attendants.
Promote Fair, Transparent Justice for Men and Women. While traditional systems of justice
61
(village councils) are discriminatory against women, they account for 80 per cent of cases settled
throughout the country. They are more accessible, more efficient and perceived as less corrupt than
the formal state courts. They also represent the only route for the majority of Afghans to access,
and are closed to women’s participation and biased against them. DFID should support measures
to address women’s and men’s legal awareness and to monitor informal justice systems
(e.g. for conformity with human rights principles).
Additional justice-related interventions requiring DFID support include:
Support for the state’s legal apparatus in applying the equal rights enshrined in the
Constitution, improving the ability of the formal legal system (including the MoJ) to interact
with local, informal/tribal systems of justice, to promote and protect women’s rights;
Support for the provision of legal aid for women at the provincial and district levels;
A legal rights outreach programme to inform women and men about inheritance
rights at the village level; promotion of legal literacy and awareness-raising on men’s and
women’s rights around land, provisions of customary vs. Islamic law, justice mechanisms etc,
delivered in a way that seeks to synergise with local institutional mechanisms and that
generates local level ownership, as well as building on gender equity: (e.g. for female judges in
family courts in rural areas to facilitate inheritance claims); and,
Support for land-related policy development, which should seek to actively consult with
women and men to promote inclusion of interests.
Develop Institutional Capacity to Support Gender Equity. DFID should bring to bear its
experience and institutional memory, to broker the multi-dimensional nature of issues such as
gender inequality and female vulnerability in policy making. DFID can increase effectiveness in
activities, delivery and programmes by: pushing for innovation in programme design,
moving away from approaches which have not yielded results, and helping to identify and
enhance the gender awareness and understanding of stakeholders in formal and informal
institutions who have the ability and influence to enact long-lasting changes.
Formal and institutional personnel constitute the most effective change agents. Here, quality, not
just quantity, will be critical. Going beyond the numbers alone (e.g. an increase in the number of
women in institutions and processes) to focus on how they should be included to yield maximum
impact, and what support they will need to deliver on it, will be critical.
Additional Recommendations. The following should also be considered in DFID policy formulation
and programming concerning gender and women’s empowerment.
A robust, realistic understanding of women’s rights, gender equality issues and insights on the
complexity of local socio-political and economic relationships and power interactions will need
to be mainstreamed across DFID’s Afghanistan programme;
DFID should, when security conditions permit, reach out beyond the urban areas to reach
women and men whose contact with state institutions, markets and NGOs is limited;
DFID should aim to bridge the gap between constitutional commitments and informal
institutional understanding through dissemination of knowledge and capacity building
around tangible, practical interventions with evident benefits to men and women;
Support to civil society to continue to build a constituency of support for gender
equality will be important, not least because sustainable change in male-female relations
will only come from within Afghanistan, in all its geographic and socio-cultural diversity.
8.7 Social Exclusion

The aforementioned recommendations applicable to poverty, gender and women’s empowerment
apply to the broader question of social exclusion, and they must be applied to other marginalised
groups such as youth, the elderly, the disabled and others.
62
Improve Access to Social Services. Perhaps the leading concern of socially excluded groups is
access to social services such as health and education. Access to such public goods has been
increasing, though each group has faced specific challenges in receiving their benefits. The
poor may require basic social safety nets rather than mainstream services, as the chronically poor
may be required to forsake children’s education in order to maintain a meagre sustenance lifestyle.
Other marginalised groups may face similar barriers, particularly when marginalisation is based on
identity, or may be too geographically isolated to readily access public goods. DFID must take a
strong role in improving access to social services and, equally if not more important, ensuring that
the Afghan government is prepared to maintain services and social safety nets in the event of
diminished international financial support.
Utilise Customary Institutions. Afghanistan, as noted in Section 7, has consistently demonstrated
a religiously-founded obligation to support the poor and marginalised and a strong emphasis on
safeguarding women’s honour. Such systems must be utilised productively. Zakat and other
charitable obligations must be mobilised and regularised in order to ensure the locally
owned provision of basic social safety nets for the chronically poor, the disabled, female
headed households and others. Similarly, customary and religious leaders must be incorporated
into programmes aimed at reducing the marginalisation of women and other groups. For instance,
emphasising women’s role as mothers and their traditional responsibility for the family, schools and
health may be used to advocate for their education and for their expanded involvement in local
governance.
Strengthen Monitoring and Accountability. The dual responsibilities of the State and customary
institutions for social service provision and for mediating the experience of the poor, women and
the socially excluded is likely to persist. Each is subject to failures and complications in relation to
particular populations, services or locations, thus leaving gaps which will require attention. In order
to highlight and respond to these gaps, improved monitoring and data collection
regarding marginal populations must be ensured. Rather than focusing strictly upon
quantitative indicators of progress, a dual emphasis should be placed upon qualitative
research concerning inter-personal relations and the evolving nature of impediments to
equity and social inclusion. Such a system should, for instance, attempt to change the changing
notion of female honour and its application or manipulation by parties in the intensifying
contemporary conflict.
Support Policy-Oriented Advocacy. Finally, institutions to facilitate policy advocacy among
excluded and marginalised groups should be created to give them a political voice. This role
has largely been filled by donor institutions and international NGOs, though it may be time for a
‘nationalisation’ process. As indicated above, a public information programme with the goal of de-
stigmatising marginalised groups may need to first be implemented in order to create a facilitative
environment for such policy-oriented activities.
8.6 Cross-Cutting Recommendation: Further Research

A final recommendation made within each ‘Understanding Afghanistan’ output is the need
to improve, widen and centralise the collection of data concerning governance,
corruption, social exclusion, conflict vulnerability and economic growth. The currently
fragmented nature of data collection makes data-based analysis and policy-making burdensome if
not impossible.
In relation to the Strategic Conflict Assessment, further research into the potential strategies for
increasing the evident role of Islam within Afghan governmental institutions. The Growth Diagnostic
highlighted the need for greatly expanded data collection of economic indicators in order to
facilitate econometric analysis. Finally, the Poverty, Gender and Social Exclusion Analysis highlighted
the need to strengthen quantitative studies of exclusion while recognising that qualitative studies
63
will be necessary in order to capture the ‘relational’ and experiential dynamics influencing
trajectories of gender, poverty and other forms of marginalisation.
64
9. Conclusion
This synthesis has attempted to consolidate the various outputs of the ‘Understanding Afghanistan’
undertaking and to reflect those key points and areas of mutual concern. Above all else, the need to
better understand conflict in order to contribute to its resolution is highlighted. Security is
necessary for facilitating economic growth, for allowing the foundation of a stable State
and for the inclusion of marginalised groups. That said, a strict focus upon security
through military and counter-insurgency efforts is widely deemed short-sighted and
bound to fail. A concerted effort to integrate the Taliban-led insurgency into the government is
critical and will provide, perhaps, the only viable route to stability and, eventually, peace. As the
brief historical analysis provided in this report shows, power-sharing arrangements which exclude
key stakeholders will be subject to continued contestation until they ultimately devolve into all-out
armed conflict.
9.1 Areas of Consensus

The need for a political resolution to the conflict was widely agreed upon. Further areas of
strong consensus include the need to bolster the State’s legitimacy through improved governance
and the vigorous eradication of corruption, particularly in relation to the police, the judiciary and
trade-related institutions. Furthermore, the need for the employment of traditional mechanisms and
religious sources of authority, such as the Ulema, was considered necessary in all instances. Doing so
will lead to security improvements and will provide the State with the ideological and moral
authority it lacks.
9.2 Points of Contention

Points of significant contention were minimal throughout this project, though this is, admittedly, a
function of the separate although complementary tasks undertaken by each of the output teams.
The greatest sources of contention concerned broadly theoretical questions of the development
approach to be employed by DFID and other donors. While some, such as those engaged in the
technical Growth Diagnostic Scoping Study and Political Economy Analysis, felt that a national
approach was called for, many others, particularly in relation to the Strategic Conflict Assessment,
Poverty, Gender and Social Exclusion Analysis and Growth Diagnostic Policy Discussion Paper,
deemed a local approach to be more likely to succeed. In either event, the perspectives are far from
contradictory. All those engaged in ‘Understanding Afghanistan’ would agree that both
approaches are necessary and that, in relation to the State and the economy, that mid-
level structures still require formation and guidance. With NGOs working on the community
level and governmental and inter-governmental entities at play on the national level, sub-national
governance has failed to effectively materialise, and economic links between communities and
global markets have only grown in relation to insurgency and illicit economic activities.
9.3 Refreshing ‘Understanding Afghanistan’

The findings from ‘Understanding Afghanistan’ have challenged some of the common assumptions
often made by the international community and national policy makers about the nature of the
conflict and speed of progress. Such evidence-based research provide invaluable platform for
policy development. However, given Afghanistan’s rapidly changing context, this sort of
engagement must be ‘refreshed’ from time to time with new data sets and new perspectives
brought into the equation. The findings from this engagement can be easily used as the baseline for
future studies and comparisons.
65
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70
The University of York’s
Post-war Reconstruction
& Development Unit (PRDU)
‘…linking theory and practice
for enablement and development…’
Established in 1993, the Post-war

Reconstruction and Development Unit
(PRDU) has pioneered the study of war-torn
societies and their recovery
Regional Human Security

Centre (RHSC), Amman
‘…advancing human security through
research, training and dialogue …’
Contact:
The PRDU Tel: +44-1904-432640 © 2009
Derwent College Post-war Reconstruction
University of York Fax: +44-1904-432641 & Development Unit,
Heslington The University of York
York YO10 5DD E-Mail: prdu@york.ac.uk
United Kingdom szb1@york.ac.uk

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Synthesis Report

Sultan Barakat, Post-war Reconstruction and Development Unit

7.2.1 Poverty and Access to Public Goods and Services ...............................................................42

9.1 Areas of Consensus............................................................................................................................................65

Table of Figures and Tables

Table 1. Key Phases in Contemporary Afghan Conflict ........................................................................................17

Acronyms and Abbreviations

ISAF International Security Assistance Force

1.2 Key Findings

Contemporary conflict within Afghanistan involves a growing diverse group of fighters

Each of these groups, however, is fuelled by Afghanistan’s exceptionally pronounced

The present-day Afghan State continues to struggle to gain legitimacy as a result of

Similarly, economic development, while having achieved impressive growth in GDP,

Agriculture presents, perhaps, the greatest opportunity for providing national

Violence against women must be understood as a remaining and potentially

Finally, on an overarching programmatic level, three core components must be considered.

2.1 The Political Economy Approach

2.2 Opportunities and Challenges

3. Context and Conflict in Afghanistan

3.1 The Structural Context

3.1.1 Physical Structures

3.1.1.2 Natural Resource Endowment

3.1.2 Human / Social Structures

6 Afghanistan Geological Survey, 2007

Figure 1. Afghanistan’s Demographic Structure in 2000

Source: Population Action International (2003)

3.1.2.2 Culture and Ethnicity

8 Almost the entirety of the remaining 20 per cent are Shia.

3.2 The Historical Context

Table 1. Key Phases in Contemporary Afghan Conflict

1979 - 1988: Jihad in a Cold War Context

state policy, religious networks and political connections (Paris: CERI).

1989 - 1992: Jihad among Afghans

3.3 Conflict and Security

12 See Maley, (1998) for an analysis of their rise to power.

Table 2. The Mounting Security Crisis

2002 2003 2004 2005 2006 2007

Percentage of ‘Successful’17 Attacks - - - 74.5 71.7 79.1

Civilian Deaths per ‘Successful’ Attack - - - 4.2 5.1 5.2

IED Attacks18 22 83 - 783 1,730 1,314

Suicide Bombings19 0 2 3 17 123 137

Afghan Civilians Harmed by Such Attacks 20 - - - 1,540 3,557 4,673

Coalition Military Fatalities21 68 57 58 130 191 232

3.3.1 The Multi-Conflict System

3.3.1.1 The Insurgency

Figure 2. The Expanding Security Threat

Figure 3. Annual Increases in Afghanistan’s Opium Production (MT)

Source: UNODC (2007)

3.3.1.3 International / Regional Conflict

3.3.1.4 North-South Competition

3.3.1.5 Local, Power-Sharing Conflicts

3.3.1.6 Interpersonal Violence

4. Contemporary Conflict in Afghanistan

4.1 A ‘Theoretical’ Perspective on Conflict in Afghanistan

4.2 Insurgents and Armed Opposition Groups

to Afghanistan, who it released three months later. It is an increasingly active organisation,

4.3 Motivating the Insurgency

4.4 Financing the Insurgency

5. Governance and the State

5.1 The Envisioned State and Underlying Assumptions

5.2 Setting the Stage: The Bonn Agreement

5.3 Territorial Control

5.4 Revenue Control and Mobilisation