Peering, head above the parapet, into Afghanistan’s next 10 years

In Firdausi’s Shahnameh – completed at the start of the 11th century at Sultan Mahmud Ghaznavi’s court, a two-hour drive south of Kabul – the hero Rostam lives near the Helmand river, in lands granted by Iran’s king Manuchehr to Sam and Zal. This grant is “a charter full of celestial praise,” including overlordship of “Kabol, Danbar, Mai, and India, the Sea of China as far as the Sea of Send, as well as Zavolestan as far as Bost.” Sam receives rich gifts, reflecting the prosperity of this wide realm. In Rabindranath Tagore’s short story Kabuliwala (1892), the narrator – a cloistered but “well-born Bengali gentleman” – chats to beturbaned fruit peddler Rahamat about “Abdur Rahman and the Frontier Policy of the Russians and the English” before realizing that “talking to the Kabuliwala served me in lieu of travel.”

The news about Afghanistan this fall is once again relentlessly negative. It has tracked an imperfect election, with alleged fraud by leading candidates of as-yet unmeasured dimensions. Deeper lies the unresolved issue of nation-building, a project pursued only fitfully by Afghans and their international partners since 2001, and without which neither peace nor recovery is a serious prospect. Then there is the continuing conflict, still eluding easy categorization: is it a nascent Pashtun revolt, born of a lopsided bargain at Bonn? Or is it a consequence of Pakistan’s unquenched drive for ‘strategic depth’ – their version of the old Frontier Policy under the Raj – an imperative for officers and political leaders since Zulfiqar Ali Bhutto in 1971, after Bangladesh had been lost and rivalry with India began to take on ‘asymmetric’ form?

This article does not tackle any of these issues. Rather, it is about the backdrop to Afghanistan’s existential questions: electoral legitimacy, massive institution-building, regional peace. Afghanistan has been a crossroads – both entrepot and emporium – from time immemorial. For its region, for Asia and for the world, it exercises a powerful imaginative hold – an influence rooted in literature, dynastic history and successive civilizations on the Iranian plateau, and in South and Central Asia. This resonance is in turn founded on its lynchpin role in trade and exchange. Thirty years of conflict have blurred this legacy. A passerby in the streets of Tabriz, Kolkata or Hamburg can be forgiven for not seeing Afghanistan as a cultural hotbed, much less an economic oasis. But it is far from extinguished. After eight years of post-Taliban transition – despite suicide attacks and electoral complaints – Afghanistan is re-emerging at centre-stage.

Afghanistan is reconnecting itself to Asia. Since 2002, 90 percent of the highway circling the Hindu Kush – linking Mazar-e Sharif, Kabul, Kandahar and Herat – is rebuilt, with only the hilly northeast quadrant still unfinished. This ‘ring road’ is now linked by asphalted arteries to key border crossing points: Torkham and Spin Boldak (Pakistan), Zaranj and Islam Qala (Iran), Torghundi (Turkmenistan), Hairatan (Uzbekistan) and Sherkhan Bandar (Tajikistan). The donors are all potential trading partners – the EU, India, Iran, Pakistan and the US.

Most epoch-making has been the torrid pace of provincial and rural road-building – the network driving Afghanistan’s trade rebound since 2001 and the uplift of its farm economy. This road-building is a warrant for more ambitious transit arrangements linking Chinese, Russian and Central Asian entrepots with Karachi and Gwadar (Pakistan), Chahar Bahar and Bandar Abbas (Iran) ports. Through the Central Asian Regional Economic Cooperation (CAREC), established by the Asian Development Bank (ADB) in 1997, these projects are embedded in Asia-wide transportation corridors.

Afghanistan’s reconstitution began with massive refugee returns – over five million citizens have been repatriated since 2001. But economic drivers have been equally critical. Regional trade has blossomed: according to the Economic Cooperation Organization (ECO), total trade among the 10 ECO members rose from US $10.8 billion in 2002 to US $38.7 billion in 2006. Iran, Turkey, Kazakhstan and Afghanistan account for most of this growth; Afghanistan’s total trade with ECO partners (adjusted for national reporting deficiencies) was close to US $4 billion in 2006 – a dramatic rise from virtual standstill under the Taliban regime. Over the same five years, ECO countries averaged eight percent annual GDP growth. From 2002 to 2007, Afghanistan had 14 percent annual GDP growth. In spite of continuing global economic crisis, the IMF projects nine percent GDP growth for Afghanistan in 2009.

The 10 ECO economies – which include Afghanistan and all of its neighbours except China – went from 1.2 percent of world GDP in 2002 to 1.9 percent in 2006. Is this surprising? Such rapid growth is remarkable, even by global standards. But its causes are not difficult to find. When the Taliban started as a movement in 1993 and 1994, with Pakistani assistance, their first priority was to reopen the highway system – then pot-holed and beset by factional checkpoints due to civil war. The goal was to open traffic between Pakistan and Central Asia, thereby securing access to five new states. In the end, Afghanistan’s continuing conflict from 1994 to 2001 – aggravated by diplomatic and economic isolation – undid the mercantilist vision of ‘strategic depth.’ But the post-Cold War potential for trade linking Central Asia, China, Gulf, Russia and South Asia is real.

It is already transforming communities. Along the Pyanzh river separating Afghan Badakhshan from Tajik Gorno-Badakhshan, three new bridges have changed life for four Afghan districts: Wakhan, Ishkashim, Shugnan and Darwaz. They have restored family ties sundered by demarcation in the late 19th century. ‘Border bazaars’ have flourished – with weekly events becoming almost daily. From Badakhshan, there is potential to broaden these linkages to communities in Chinese Xinjiang and Pakistani Chitral.

Afghanistan’s new regional affiliations are mutually reinforcing. Formed in 1985, ECO received Afghanistan as a member in 1992; the ECO Council of Ministers met for the first time in Afghanistan – from 16 to 20 October 2007 in Herat. ECO now seeks to bring about a free trade area among its members by 2015. In 2007, Afghanistan joined the South Asia Association for Regional Cooperation (SAARC), also formed in 1985: SAARC is now pursuing the South Asia Free Trade Agreement (SAFTA).

On March 27, 2009, in Moscow, the Shanghai Cooperation Organization (SCO) held a first-ever special conference on Afghanistan. Its theme was cooperation against terrorism, narcotics and organized crime. UN Secretary-General Ban Ki-moon, the US, the EU Presidency, the European Commission, NATO, major European states and Canada – all taking part for the first time – supported a joint declaration, while SCO members issued a statement and action plan.

The new ECO Secretary-General is Mohammad Yahya Maroofi, an Afghan diplomat who was Ambassador to Tehran and Oslo and diplomatic advisor to President Karzai during the Bonn process. The US has committed itself to ensuring that Afghanistan and Pakistan agree a revised bilateral trade and transit agreement by the end of 2009. Following trilateral summits with the Presidents of Afghanistan and Pakistan, Turkey has launched the Istanbul Forum as a catalyst for regional trade. To support improved cooperation at entry points along the Afghanistan-Pakistan border, Canada has supported the Dubai Process – an effort to bolster the capacity of border officials on both sides.

There is an entirely new vision for roads in the heart of Asia in CAREC’s Connecting Central Asia: A Roadmap for Regional Cooperation (2008). In 2001, Afghanistan lacked paved roads outside major cities. Today, the Central and South Asia Transport and Trade Forum, which groups Afghanistan, Iran and Pakistan alongside Tajikistan, Turkmenistan and Uzbekistan, is actively seeking to improve access to ports on the Arabian Gulf. Until now, Afghanistan has lacked substantial rail infrastructure. In March 2009, the ADB approved a Railway Development Study for Afghanistan: a first line from Islam Qala to Herat is virtually complete. Bereft of functioning civil aviation in 2001, Afghanistan now boasts one state-owned airline (Ariana) and three Afghan commercial carriers (Kam Air, Safi and Pamir) – two of which are operating near-new aircraft.

Complexity is a management challenge – especially for nation-states. At its best, Afghan foreign policy in the 20th century was neutral, drawing benefits from all, and preventing domination by any one power. Post-Taliban Afghan strategic planning has sought to revive this tradition. According to the sector strategy for regional cooperation in the Afghanistan National Development Strategy (ANDS) – a five-year blueprint unveiled in Paris in 2008 – Afghanistan is a “central connecting hub” – a critical strut at Asia’s core, linking the Far East (through China), Central Asia, South Asia and the Middle East. The diplomatic touchstone for reconnecting Afghanistan to Asia is the Kabul Declaration on Good Neighbourly Relations, adopted by Afghanistan, its six neighbours and G8 members on December 5, 2005 in the Afghan capital. The second Regional Economic Cooperation Conference for Afghanistan (RECCA) took place in Delhi on November 19, 2006. In 2007 and 2008, the RECCA process yielded to regional security imperatives. But the Afghanistan-Pakistan Peace Jirga Declaration adopted in Kabul on August 12, 2007, followed by the October 28, 2008 Islamabad Declaration of the smaller jirgagai, addressed a key dimension of the regional cooperation challenge. The third RECCA finally took place on May 13 and 14 of this year in Pakistan, generating another Islamabad Declaration – driving home the emerging trade, border and energy agenda.

What is the upshot? The Islamabad conference focussed on rail projects – extending Pakistani lines from Quetta and Peshawar to Kandahar and Jalalabad inside Afghanistan, then linking them onwards via a railway shadowing the ring road highway to lines now approaching completion in Herat and contemplated for Hairatan-Mazar-i-Sharif. It also highlighted border management. It identified potential in mining and agriculture. It underlined the need for larger-scale capacity development. In marked contrast to 2006, there is now serious action on each of these fronts.

The Taliban have targeted trucks and traders – both to disrupt military resupply and undercut regional cooperation. In Afghanistan’s Southwest, issues of trade and transit take a back seat to the threat from narcotics traffickers. But the resilience of insurgency and cartel-driven drug trafficking has not prevented major improvements to road and border infrastructure: the Kandahar-Herat and Zaranj-Delaram highways were completed on time. Zaranj remains the fastest-growing city in Afghanistan – living testimony to trade’s vibrancy even in the teeth of conflict and an illegal economy.

An Afghan economy wired into Asian networks, further integrating economic giants with better overland connections, would embrace four pillars:

Minerals and precious stones – the first pillar – have been pivotal from Sultan Mahmud’s time. Beyond the Ainak copper mine in Wardak (south of Kabul), bringing US $3 billion in Chinese investment to one of the world’s 10 largest copper deposits, Afghanistan has gold. It also has iron and other base metals, coal and precious stones. In Jawzjan and Sar-i-Pul, it has proven oil and gas. Potential reserves, including in Helmand and Kandahar, are much larger. And exploration is accelerating. Mineral projects bring multipliers: Ainak includes a commitment to build a railway along the Torkham-Jalalabad-Hairatan route.

The second pillar is energy. As of January 2009, power imported from Uzbekistan is lighting homes in Kabul through new high voltage lines built from the North under the Northeast Power System – an initiative supported by the ADB, the World Bank, the US, Germany and India to bring imported power from Tajikistan, Turkmenistan and Uzbekistan to Kabul, adjacent provinces, and the Southeast. The current ANDS sector strategy calls for 1,840 megawatts of installed hydroelectric capacity in the Helmand, Hari-Rud, Kabul, Kokcha and Kunar riversheds. Rehabilitation of existing facilities at Salma (Hari-Rud), Kajekai (Helmand) and Dahla (Arghandab-Helmand) is underway. Under the Central Asia-South Asia Regional Energy Market, promoted by the ADB since 2006, the CASA-1300 project would bring a generated surplus in Kyrgyzstan and Tajikistan to market in Pakistan. The Turkmenistan-Afghanistan Pipeline Initiative is advancing, with Turkmenistan recently confirming supply.

The third dimension is business infrastructure. A Private Sector and Civil Society Enabling Council is active at presidential initiative, following a conference organized by the government and the Aga Khan Development Network in July 2006. Over 10 million Afghans now have access to mobile telecommunications. Access to finance has improved with 14 banks now licensed, including a network of entities offering microfinance. Under Afghanistan’s Border Management Initiative, customs procedures are improving, due to new equipment and better training. On September 27, 2008, Afghanistan inaugurated the Afghanistan Central Business Registry – a one-stop shop.

Tourism and culture – the fourth pillar – are equally critical. Badakhshan, Bamiyan, Herat and other provinces are already cultural magnets – as pilgrimage sites, as centres of civilization, and as stunning settings. With better security, tourism is set to become a major driver of Afghan growth. A new generation of mountain guides took several expeditions to Badakhshan’s highest peaks in 2005. On April 22, 2009, Mostapha Zaher, Director-General of Afghanistan’s National Environmental Protection Agency (and grandson of King Zaher Shah), inaugurated Afghanistan’s first national park at Band-e Amir – a series of six terraced lakes in Bamiyan province. The Afghan story has a huge audience – from Khaled Hossaini’s best-selling Kite Runner, to Atiq Rahimi’s Prix Goncourt-winning Syngue sabour (Pierre de patience), to the blockbuster Afghan Star feature on Saad Mohseni’s Tolo television – itself the subject of a prize-winning documentary. Farhad Darya remains one of the Farsi-speaking world’s greatest singers. “East-West Divan,” an exhibition of contemporary Afghan, Iranian and Pakistani artists shown at the 2009 Venice Biennale, has put this vitality on display, as has urban regeneration and restoration of historic monuments by the Aga Khan Trust for Culture in both Kabul and Herat, and by Turquoise Mountain in the Murad Khane precinct of Kabul’s Old City. The “Bactrian Gold” exhibition, now shown in Europe and North America, has refreshed the world’s taste for the richness of Afghanistan’s archaeological legacy.

Afghanistan can be a lynchpin – for trade and transit, for the broader energy market, for next-generation tourism, and for an improving business environment. It is a potential hub for the next phases of Asian economic integration. After only six years, Afghanistan has the region’s best mobile telecommunications network. Why should it not be possible for transit or tourism to follow suit? With a myriad of initiatives now underway to unlock these possibilities, three scenarios present themselves: which one will Afghanistan embrace over the next quarter century?

The first is focussed on energy and infrastructure: Afghanistan as a web of new linkages speeding up land-based trade and transit – connecting the four corners of Asia, as well as more distant Europe and Africa. It would emphasize rail and road construction, as well as base metal and hydrocarbon development – to feed economic growth in China, India, Russia and a host of smaller Asian economies. It would also rely on new power lines and pipelines to bring Central Asia’s energy surplus to bear on South Asia’s deficit. This would be an export-led growth model, rooted in a trading, resource-driven economy. Let us term this scenario the Lapis Economy – in recognition of Badakhshan’s ancient gemstone export that was traded to Predynastic Egypt as early as 3300 BC.

The second scenario would be for the Yaghestan Economy to predominate. Yaghestan is a Persian term – often applied to tumultuous periods of Afghan history – made famous recently by Michael Barry in Le royaume de l’insolence: L’Afghanistan 1504-2001: it literally means ‘land of the rebellious.’ Under this scenario, the drug lords protect – even enhance – their hold on power. The Taliban go untamed. A new generation of warlords is weaned. Impunity reigns. Recent gains in protection of human rights go by the boards. But Afghanistan continues to produce the world’s largest, high-quality, totally fungible, illegal commodities: opium and heroin. Under this scenario, development, nation-building and ‘Afghanistan as entrepot’ are put on hold, or shelved altogether. International engagement is reduced to ‘terrorist hunting,’ as Rory Stewart, George Will, Jeffrey Simpson and other advocates of disengagement have urged.

The third scenario is the Deodar, or Chinar, Economy. The deodar (cedrus deodara) is a species of cedar native to mountainous areas of South Asia: it has highly aromatic bark and needles, which can turn an alpine landscape into a riot of perfume. ‘Chinar’ is the Persian name for the oriental plane tree (platanus orientalis), which has been a sacred tree in India, Afghanistan and Iran for millennia, and had already been imported to ancient Greece: Hippocrates is reported to have taught under a chinar. This is the future in which Afghanistan is given the opportunity to recover its history, to rebuild and celebrate its monuments and institutions, and to participate fully in the new global economy – one based on innovation in both goods and services. This would be an Afghanistan with not only highways, but a stock exchange; with mobile communications and software start-ups; with eco-tourism in Bamiyan and ‘Silk Road’ tours of Helmand.

For the foreseeable future, Afghanistan will remain a hybrid of these scenarios. Each has had its champions in recent elections. Tilting the balance toward exports and nation-building will require a consolidation of forces – internal and external. At the time when President Karzai first referred to Afghanistan as “a crossroads of civilizations” and “a land bridge for Asia,” Dr. Abdullah was his foreign minister and Dr. Ashraf Ghani his minister of finance. As Afghan civil servants return from training in India, Pakistani merchant groups advocate more effective cross-border security arrangements, Iranian officials seize precursor chemicals needed for heroin production in Afghanistan, and Kazakh oil field engineers contemplate their next contract in Sar-i-Pul, there is no commodity so precious as Afghan leadership – the ability to drive forward a new era of reforms in all the relevant sectors of government, private sector and civil society.

In A Ten-Year Framework for Afghanistan – a report by the Atlantic Council – Dr. Ghani put it simply: “The Afghan people want institutions of good governance and to be part of the modern global system.” In short, Afghans want deodar, chinar and a whole forest of additional trees. Who knows? If international resolve holds, if counter-insurgency and institution-building can be delivered through an integrated approach, they may even see this goal start to be reached.

Afghanistan was already a centre of commerce and civilization in antiquity. Under its great Islamic dynasties, it became one of Asia’s key arteries of conquest, migration and trade. In the 19th and 20th centuries, it was written out of the global economic script. As a Great Game and Cold War buffer state, its borders were sealed, its railways unbuilt; investment denied. Undoing such a formidable legacy is hard.

But today, Afghanistan has a genuine opportunity to reoccupy higher ground in the new game of regional integration. Its economy is relatively open. Its currency is stable. Linkages with the outside world are strengthening. There is every reason to expect that 21st century traders and professionals will again make their homes in Khost, Jalalabad, Kabul, Mazar-i-Sharif, Herat, Kandahar and the thousands of other communities across Afghanistan that have deep roots in the soil of Asian trade. There is even potential for NATO and Russia to make stability in Afghanistan and Central Asia a new fulcrum of cooperation – one that might underpin a broader Eurasian peace.

When he wrote of Zabolestan, Firdausi was flattering his patron, Sultan Mahmud – the progenitor of a Turkish dynasty who ruled from Herat to Delhi. Today, Afghanistan again commands attention in Asia and beyond by those who seek advantage and profit – the equivalent of today’s ‘Bengali gentlemen’ in Singapore, Sydney and Siena. The global economy has new rules – as does the nascent Afghan nation-building process. The rules for regional economic cooperation and regional security for Afghanistan are also being written anew: when will they be accepted, and will they hold?

Students burning midnight oil at Kabul University, or in high-walled compounds in Daikundi, understand the opportunities. They are seeking the skills with which to embrace them. They are pleased to live on remittances or assistance-driven benefits for now, but will demand their place in the economy of the future. An Afghanistan open to the world would reduce friction in Asia’s economic engine room. The gateway for South Asian goods to reach Europe by truck through Afghanistan, Uzbekistan, Kazakhstan and Russia is nearly open. South Asia’s appetite for energy has never been keener. China’s reach into the Gulf and beyond into Africa has never been stronger.

The wild card remains Pakistan – a Taliban sponsor, past and present, with the ability to veto key aspects of regional cooperation, whose army continues to see Afghanistan as an Indian-dominated Yaghestan. Will Pakistan see advantage in allowing Afghanistan to embark on a future of regional reconnection? Will it be willing to replace a Taliban-led scorched earth policy with a trade-driven condominium? Time will tell. With breathing room for today, and internationally-backed stability tomorrow, Afghanistan has the potential to be the hinge for a new wave of Asian economic development. Whatever the ultimate scenario, we all have an interest in seeing that pivot turn.

Christopher Alexander was Canada’s first resident Ambassador to Kabul (2003-2005) and Deputy Special Representative of the UN Secretary-General in Afghanistan (2005-2009).