Abd Al-Haq Arsala — an Afghan mujahideen commander — said “For us, Afghanistan is destroyed . . . It is turning to poison and not only for us but for all others in the world . . . Maybe one day [the Americans] will have to send hundreds of thousands of troops to deal with that. And if they step in, they will be stuck. We have a British grave in Afghanistan. We have a Soviet grave. And then we will have an American grave.” He was not wrong. On the 15th of August 2021, the Taliban recaptured Kabul after 20 years, undoing the makings of the USA and its allies. As they now prepare to govern the Afghan people along the lines of their version of the Sharia law, one of the many things that the world has been largely unaware about is — how do the Taliban make their money? While we do know that the Taliban is one of the richer terror groups, we don’t know whether it is enough to sustain an economy on the verge of collapse.
Experts suggested that as of 2020, there are five major (and known) sources of Taliban revenue — extortion, opium & drugs trade, mining, donations and exports.
Afghanistan is the world’s largest producer of opium, with its harvest accounting for more than 80% of the world’s supply. Farmers aren’t keen on changing their ways mainly because cultivating poppy seeds is profitable for them. Despite US airstrikes on poppy fields, cultivation was estimated at 37% in the middle of the pandemic last year. Taliban, apart from earning money from the export of opium, also impose a 10% tax on every link in the production process of the drugs (the cultivators, the places that convert the seeds to drugs and traders responsible for the supply channels)
Researchers have estimated that this brings in anywhere between $100–400m dollars annually. In other words, it accounts for 60 per cent of the Taliban’s revenue, despite the outfit’s promise to ban the cultivation of poppy seeds. In 2000, the cultivation of poppy seeds was banned as the Taliban sought international legitimacy. The decision faced much resistance and they were forced to change their stance.
Myriad factors drive opium poppy cultivation in Afghanistan, some of them being political instability, scarce employment opportunities, lack of quality education and limited access to markets.No matter how hard they try, they cannot get rid of the production as they are too tied up in it. According to Gretchen Peters, the American author of the book “Seeds of Terror: How Heroin Is Bankrolling the Taliban and Al-Qaeda”, said the Taliban’s previous ban on poppy cultivation was tactical. The terror outfit was under immense international pressure and that it was a ploy because they had so much stored up. The group made a huge amount of money once the price shot up by 10 times.
It is clear that the Afghan economy has always been dependent on the drug trade for its survival. Even if it does make money, it is at the cost of those who consume these drugs in and around the world. The right thing for them to do is to curb the production and take up other jobs such as extracting mineral resources (which the country is laden with). This not only brings revenue in the long run but would also fund them to discover newer and cleaner energy (note the irony). An example of a country that invests in cleaner energy by way of exporting fossil fuels is Norway which is debatable and yet carried out for the greater good. However, it takes a huge amount of effort by the existing “government” to convince its people and itself to move on to purposeful opportunities, instead of being engaged in illicit activities. Furthermore clamping down on drug peddlers in the country and curbing routes can be carried out with much more efficacy by the Taliban than anybody else, due to Afghanistan’s (and moreover the Taliban’s) long term affair with poppy seeds and drugs. This can be seen as a more moderate and legal stand on the part of the Taliban and serve as the base for securing international legitimacy. Predictably, the decision(if taken) would affect the demand and supply chain of drugs and their users around the world. This opens up potential avenues that can be exploited and (hopefully)crackdown on major drug-trade routes and their operators.
Another important source of revenue for the Taliban is mining. The mineral resources of the Afghan subcontinent, which are estimated at around $1 trillion as of 2021, are often thought to be underexploited. These rich mineral resources are profitable for countries that have chosen to recognize the Taliban government. They extract minerals like iron ore, gold, zinc, copper, et al. Most of the mining is carried out in small pockets and illegally.
Expanding control over areas is also a way for the Taliban to make money. It seizes control and threatens the local traders to pay their “taxes” (essentially reading between the lines, a proportion of their (potential) profits). Over the past twenty years, a sizable amount of Western money has also ended up in Taliban pockets. Visualise the Tom and Jerry episode where Tom digs a hole in the sands and Jerry throws the sand back into the hole almost immediately. The group taxes (and disrupts)the infrastructure projects undertaken by the West, international truckers carrying supplies to forces, and services provided by the Afghan government. At the end of the day, a lot of effort, money and time invested in these projects is either wasted or reverted to the Taliban thus defeating the purpose of these development projects. Before the recapture of Kabul, they also made sure to disrupt the construction of development projects. For example, the outfit hindered the US military’s construction of the ring road, whose timely completion would have meant easier movement across the otherwise difficult terrain of the country. Taking control over territories also gave them access to military equipment, treasuries and other assets.
The speedy evacuation process in August (2021) made the US leave behind most of its “defunct” military equipment and other important (irrelevant) documents, according to claims by the Pentagon. What is worrying is that the Taliban allege they will have the equipment up and running in no time.
The terror outfit also receives “foreign aid” from sympathizers mostly from the gulf countries. In 2020, the Taliban received over $240 m in aid alone. Potential non-western countries the Taliban could turn to for aid are Qatar, Iran, Turkey, China and Russia. These countries along with Pakistan have been in constant touch with the Taliban High command. The extent to which the Heads of state would be willing to help the terror outfit is, however, unclear. It is an open secret that Pakistan provides military aid which was vital in capturing the fortress of Panjshir (which would have remained independent otherwise). Apart from campaigning aggressively for the Taliban on global platforms, the amount of aid provided is unclear for the most part (although private actors are known to finance the Taliban and provide for its operations). Saudi Arabia, which along with the United Arab Emirates (UAE) has recognized and funded the Taliban since the 1990s, has lately not been generous with its aid to Pakistan and other dependent countries.
An article in BBC stated that Qatar and Turkey will act as the lifelines for the Taliban to the outside world. Qatar enjoys a particularly close relationship with the Taliban and was instrumental in the evacuation of citizens of western countries. It has also offered (and delivered) substantial aid (mostly medical and food items) as part of its “continuous support to the Afghan people”. Turkey is the only Muslim majority nation that is a part of NATO. Over the years (as a result of NATO missions) it has developed close intelligence ties with some Taliban-linked militia. President Erdogan stated that his country was ready to lend all kinds of support for Afghanistan’s unity but would follow a very cautious path. Another potential donor, Iran’s (formerly the Taliban’s enemy due to cultural differences, however, made peace recently) financial services run dry as it has been forced to bankruptcy due to the US sanctions.
Even though Russia and China extend their support to the Taliban they are apprehensive of the infiltration of terrorism into central Asia. China does not appreciate the existence of Uighur units functioning within the Taliban. President Putin went so far as to prevent fleeing refugees from entering the country as he did not want any activities of the ISIS-K leaked into the territory. However, they may be willing to share the know-how of avoiding US sanctions through virtual currencies and unregulated money exchange platforms albeit it might be challenging. At the end of the day, countries are guided by their interests. They are eager to maintain a good relationship with the Taliban as it would help them exploit the natural resources in the region (in China’s case) and keep out extremist activities at the same time. As to whether they would fund the Afghan economy (and if so, how much) is still undecided.
It might help us to develop counterterrorism strategies if we knew how exactly the Taliban collects funds, moves them through channels and stores them. Lack of direct access to documents makes us question the existing statistics at hand. Therefore researchers have turned to indirect indicators of financial health within the Taliban system. According to an article written in the lawfare blog, factors such as lack of weapons and ammunition, complaints about late payment of salary, lack of food and other forms of subsistence indicates its inability to distribute and manage its money effectively.
Understanding how the Taliban are financing themselves is important as it gives us possible loopholes to exploit. We cannot allow the terror outfit to carry on its “governance” of the people of Afghanistan whilst promoting terror attacks within and outside its borders. So instead of the international community playing a professional blame game, we need to join hands to avert a crisis that threatens the global order.
AUTHOR- SUPRITHI SUDHARSANAN
