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13 April 2015

For a robust economy in Afghanistan

April 13, 2015

AP"Only 6 per cent of Afghanistan's land is cultivated; it could increase the yield to its full potential and help switch over from a predominantly opium-driven sector to alternative crop." Picture shows an Afghan farmer collecting raw opium in a poppy field in the Zhari district of Kandahar.
Located in the vicinity of rising economies China and India, Afghanistan has the leverage of benefitting in areas like investment, technical expertise and technology transfer

The overarching focus in Afghanistan on political stability and effectiveness of the security forces is understandable given the nature of the immediate challenges confronting the country. However, in the long run, economic stability will have to figure in as an intrinsic driver towards sustainable peace. While the previous dispensation was predominantly security-driven, President Ashraf Ghani, with his stint at World Bank and as Finance Minister previously, is expected to underscore economic reconstruction as a key component of state-building.

Beyond providing fiscal cushioning, target-oriented economic interventions can help bridge the governance gap and financial deficits — hallmarks of the previous regime, which, as offshoots of a poorly managed economic toolbox, contribute to a widening political and security vacuum. This vacuum, in turn, provides leeway for extremist forces to move in, as established by Sarah Chayes (Carnegie Endowment) in her comprehensive study drawing linkages between governmental corruption and religious extremism, especially in the context of Afghanistan.

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