19.11.2016

New study: India’s role in Afghan’s econ stability

Kabul (Afghanistan) ̶ Amidst the fallout from dwindling international aid, a new role is possible for India in the economic stabilization of Afghanistan.

  • Photo by Thomas Sjørup / CC 2.0 - A man at the market in Kandahar setting up his shop for the day, 2009

The international military drawdown from Afghanistan has led to a drop in the international financial assistance to the country. Amidst the fallout from the dwindling international aid, and the pessimistic narrative that it has churned about the future of Afghanistan, very little attention has been paid to the window of opportunity available for the long-term economic stabilisation of the country.

With Afghanistan undergoing an inteqal (‘transition’), should India continue the well-trodden path after decades long policy on development and restructuring assistance for Afghanistan? Or should it undertake policy realignments to expand its role?

These questions are of focus in a new study on India’s role in the economic stabilisation of Afghanistan. Outcome of a collaboration between the FES Regional Peace and Security project, FES India Office and the FES Afghanistan Office, the study was conceived and created with essential inputs by the Afghanistan Policy Group, a diplomacy group consisting of former and current politicians, researchers, journalists, and civil society activists from Afghanistan.

For the purpose of this publication, the author Shanthie M. D’Souza undertook a field research in four provinces of Afghanistan – Kabul, Balkh, Badakhshan and Bamyan – in the period between July and August 2016. On the bases of the primary data and interviews collected, D’Souza explores India’s role in the future economic stabilisation of Afghanistan by examining the possibility for India to replace its focus from quick- impact projects to alternative economic livelihoods programmes. Such a shift, the author asserts, is critical for the long-term stability of the Afghanistan.

India, one of the largest bilateral donor countries to Afghanistan, has already signaled its intention to continue its economic engagement and assistance. It remains to be seen how New Delhi will pursue the development and reconstruction activities amidst changing and deteriorating, political and security conditions in Afghanistan. Until present, India has refrained from engaging in any new large-scale infrastructure project. At the same time, it has shown greater inclination for small-scale low-visibility development projects, its number increasing throughout the past years.

Considering these characteristic and the changing ground conditions in Afghanistan, the study traces the trajectory and rationale behind India’s economic assistance to Afghanistan post-2001. The topic of India’s role in the economic stabilisation of Afghanistan will be further addressed at the 2016 annual regional conference on Afghanistan, held in Berlin in December as part of the FES Regional Peace and Security Project, and in a seminar on India-Afghanistan relations in New Delhi in December, organised by FES India.

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