Afghanistan’s Taliban militants have grown richer and more powerful since their Islamic fundamentalist regime was overthrown by US forces in 2001.
According to reports from Mullah Yaqoob, son of the late Taliban spiritual leader Mullah Mohammad Omar, in the fiscal year that ended in March, the Taliban raised $ 1.6 billion, which revealed the Taliban’s sources of income in a confidential report commissioned by the North Atlantic Treaty Organization. and subsequently obtained by Radio Free Europe / Radio Liberty.
By comparison, the Afghan government raised $ 5.55 billion over the same period. The government is now in peace talks with the Taliban, seeking to end their 19-year insurgency.
I study Taliban finances as an economic policy analyst at the Center for Afghanistan Studies. That’s where their money comes from.
1. Medicines: $ 416 million
Afghanistan has accounted for about 84 percent of world opium production over the past five years, according to the United Nations World Drug Report 2020.
Much of those illicit drug profits go to the Taliban, who run opium in areas under their control. The group imposes a 10% tax on each link in the drug production chain, according to a 2008 report by the Afghanistan Research and Evaluation Unit, an independent research organization in Kabul. This includes Afghan farmers who grow poppy, the main ingredient in opium, laboratories that convert it into a drug, and traders who move the final product out of the country.
2. Mining – $ 400 million to $ 464 million
Mining for iron, marble, copper, gold, zinc and other rare earth metals and minerals in mountainous Afghanistan is an increasingly lucrative business for the Taliban. Both small-scale mining operations and large Afghan mining companies pay Taliban militants to allow them to keep their operations running. Those who don’t pay have faced death threats.
According to the Taliban’s Stones and Mines Commission, or Da Dabaro Comisyoon, the group earns $ 400 million a year from mines. NATO estimates the figure to be higher, at $ 464 million, compared to just $ 35 million in 2016.
3. Extortion and Taxes: $ 160 million
Like a government, the Taliban tax the people and industries in the growing swath of Afghanistan under their control. They even issue official tax receipts.
The “taxed” industries include mining operations, media, telecommunications and development projects financed by international aid. Drivers are also accused of using highways in Taliban-controlled regions, and shopkeepers pay the Taliban for the right to do business.
The group also imposes a traditional Islamic form of taxation called “ushr” – which is a 10% tax on a farmer’s crop – and “zakat”, a 2.5% wealth tax.
According to Mullah Yaqoob, the tax revenue – which can also be considered extortion – brings in about $ 160 million annually.
As some of those taxed are poppy growers, there may be some financial overlap between tax revenue and drug revenue.
4. Charitable Donations – $ 240 million
The Taliban receive secret financial contributions from private donors and international institutions around the world.
Many Taliban donations come from private charities and trusts located in the Persian Gulf countries, a region historically sympathetic to the group’s religious uprising. These donations total about $ 150 million to $ 200 million annually, according to the Afghanistan Center for Research and Policy Studies. These charities are on the US Treasury Department’s list of terrorist funding groups.
Private citizens of Saudi Arabia, Pakistan, Iran and some Persian Gulf nations also help finance the Taliban, contributing an additional $ 60 million annually to the Taliban-affiliated Haqqani network, according to agencies. American counter-terrorism.
5. Exports: $ 240 million
In part to launder illicit money, the Taliban import and export various everyday consumer goods, according to the United Nations Security Council. Among the known commercial affiliates is the multinational Noorzai Brothers Limited, which imports auto parts and sells refitted vehicles and spare parts for cars.
The Taliban’s net export income is estimated to be around $ 240 million annually. This figure includes the export of poppy and looted minerals, so there may be a financial overlap with drug revenue and mining revenue.
6. Real Estate – $ 80 million
According to Mullah Yaqoob and the Pakistani TV channel SAMAA, the Taliban own real estate in Afghanistan, Pakistan and potentially other countries. Yaqoob said NATO’s annual real estate revenues are about $ 80 million.
7. Specific countries
According to the BBC, a classified report by the Central Intelligence Agency estimated in 2008 that the Taliban had received $ 106 million from foreign sources, particularly the Gulf states.
The governments of Russia, Iran, Pakistan and Saudi Arabia are now believed to be funding the Taliban, according to numerous US and international sources. Experts say these funds could amount up to $ 500 million a year, but it’s difficult to give an exact figure on this income stream.
Build a peacetime budget
For nearly 20 years, the great wealth of the Taliban has financed chaos, destruction and death in Afghanistan. To fight its insurgency, the Afghan government also spends a lot on warfare, often at the expense of basic public services and economic development.
A peace deal in Afghanistan would allow the government to redirect its scarce resources. The government could also see a stream of substantial new revenue from legal sectors now dominated by the Taliban, such as mining.
The stability is also expected to attract foreign investment to the country, helping the government end its dependence on donors such as the United States and the European Union.
There are many reasons to cheer for peace in war-scarred Afghanistan. His financial health is one of them.
Hanif Sufizada is an Education and Outreach Program Coordinator, University of Nebraska Omaha.
This article first appeared in The Conversation.