Afghanistan towards economic growth
By Ahmad Sahil-Since the collapse of Taliban regime Afghanistan relied on donors like International Community, World Bank and International Monetary fund (IMF). Afghan Government received trillions of $USD funds for infrastructures, agriculture, education, development, reconstruction and industrial sectors particularly in enhancing the security sector. However, Afghanistan had not made enormous progress in these mentioned sectors specifically in security sector over the period of about 1st two decades the significant steps have not been achieved by government for instance development, infrastructure, education, reduction of poverty, illiteracy and micro stability in the country.
Since the period of about past two decades, Afghanistan received trillion of dollars to build up its infrastructure, agricultural, reconstruction, industrial, educational, health and security sectors but the progress it made compared to the fuds it received is very little, Illiteracy, poverty, corruption, unemployment, and poor health services are the vital problem of the society. This article focuses on the current economic growth the country had made along with the steps it should take in the future.
In contrast with past one decade, Government of Afghanistan had not worked properly in infrastructure, development, education, administration reform and specifically to established the modernize system by which they brought the transparency and accuracy in revenue collection which still caused that government relied on International Donors. Moreover, fighting against the corruption was a tough challenge for Afghan Government so far.
In 2001, when the Taliban regime collapsed, and international community entered to Afghanistan, Afghan government depended by three vast routes for trade which located one in east and two of them in west side named, Torkham, Speen Boldak and Hiratan borders. These trade routes were the only incoming sources for Afghanistan in past 15 years. Afghan Government and private sectors invested trillions of $USD on imports through the aforementioned routes which profited the neighboring Iran and Pakistan mostly.
Subsequently, in 2014 when the National Unity Government (NUG) came into existence after an agreement, so some projects took place in Afghanistan such as the first strategic economic vast route of Chabahar port, TAPI and multi trade Air Corridor which connects Afghanistan with Central Asia. Chabahar, TAPI and these Air Corridors are became the significant alternatives trade routes to Afghanistan when it is opened officially by Afghan President both India and Iran senior officials, so with the passage of time immediately Afghanistan has changed its trade routes and reduced its imports from above mentioned countries. Meanwhile, Afghanistan has launched two other new trade Air Corridors as well with Turkey and Saudi Arabia for its trade transactions. Approximately In which recently Afghanistan has sent 1500 tons dry food and 4500 Meters Carpet. The above economic vast projects makes great import and export to Afghanistan thus the average of exports were high than imports by these economic Air Corridor and economic routes. Here is the full description of the imports and exports of the goods which Afghanistan done with other countries.
First, with the opening of Chabahar port Indian Prime Minister has pledged 120,000 tons donation of wheat via Chabahar to Afghanistan which fortunately, Afghan government has received in the first consignment 1.1 million wheat from Indian government, Moreover, the new same Air Corridors have large amount of export as well. Last year Afghanistan enabled to open Trade Air Corridors with India and Dubai that they were able to export a large average of dry foods and carpets approximately Afghanistan sent 2500 tons dry foods included carpets that all cost were $2.78 billion dry food such as grapes, raisins, pistachios and peanuts included carpets by this Air Corridor to India and Dubai International Markets, which the economy prediction reveals that this average will be increased in near future by the new economic strategy which is made by government.
In 2014, when the transition period of foreign troops began thus many foreigners withdraw their investment and leave Afghanistan due to critical and fragile situation the entire National and International Community were reluctant that Afghanistan will be again the ground of war but it couldn’t happened immediately the economic growth were increased and the International economic strategy and relation were evolved by Afghan government. Although Afghanistan is still with deficit in financial position because still Afghanistan receives funds from International Community and relies on them.
By the way other mega projects are under implementation of Afghan government which names are Turkmenistan, Afghanistan, Pakistan and India joint gas pipeline cost of the project is 22.5 billion USD which will be completed all the operations in 2019. Afghanistan is expected to earn more than $400 million USD in transit annually from the mentioned project Additionally, Afghan Government will get 500 million cubic meters of gas from the project survey indicates that in the first ten years the rate will increase to one billion cubic meters of gas from which Afghanistan will be profitable from gas pipeline. Furthermore, Afghanistan is the junction point of TAPI Project (Turkmenistan, Afghanistan, Pakistan and India), a gas pipeline with the transmission capacity of 32.8 billion cubic gas per year. A new chapter of economic connectivity between the energy rich countries of central Asia with the energy consuming countries of south Asia will open new vistas of economic development and prosperity to the region in general and to the TAPI project signatories in particular.
Finally, Afghanistan should invest in some private and governmental industries that are very significant for expanding the economic, GDP Growth and the bilateral trade relations with foreign countries Moreover, Afghan Government should fully focus to invest on some Economic and Agricultural sections as well which are coherently described here in this article Firstly, as mentioned above Government has to consider in private and public industries government should fully focus to invest and support the private industries to expand export to foreign countries. Currently Government of Afghanistan has enough great land for cultivating some for the cash and staple crops which is famous because of the excellent quality that grows in this country. Secondly, Afghanistan fresh and dry fruits are very famous globally due to its unique taste and high quality. The world market for raisins, pistachios, dried apricots, almond and walnuts is more than $2.2 billion of which Afghanistan currently claims approximately 3 percent. Many of these products were formerly produced on a large scale and continue to enjoy international recognition for quality. Raisins are Afghanistan’s primary agricultural export commodity and once accounted for 60 percent of the world’s market. Pakistan, India, and Russia offer large, nearby markets in which Afghan products could begin regaining market share. Existing raisin processors are ripe for new investment to increase and improve production. Ideal growing conditions exist for almonds, pistachios, and apricots. The world’s largest importers of these products India for almonds and Russia for dried apricots are natural regional markets. Low productivity of existing orchards and production facilities as well as a lack of machinery for sorting, drying, and packaging, are issues facing by the Afghan industries and this major opportunity for both the domestic and International investors to invest in Afghanistan Agriculture sector. Especially in dry fruits processing. Furthermore, Saffron is also one of the strongest growing export sectors and subsequently brings economic opportunities with unique product quality which is famous throughout the world. Agri-processing is a resilient sector historical significance, marked by a higher per unit value and provides an array of exciting investment opportunities for both domestic and foreign direct investors.
Ahmad Sahil is Finance Manager at High Peace Council (JPIC), he has worked with various profit and nonprofit organizations in the field of Finance, and he is Social Activist and a regular contributor of Social Activities. Sahil hold Bachelor in Business Administration (BBA) Finance Specialization, Follow on twitter @k_ahmad90.