With the ouster of Taliban regime from Afghanistan in 2001, hopes for reconstruction and development of national infrastructures of Afghanistan including economy went high. But today, after more than a decade after international engagement, this country is highly dependent on international aids and its economy faces the highest level of uncertainty.

There have been improvements, no doubt, in all sectors but those are not significant enough and the Afghan economy has not undergone any significant change. Improvements are deemed fragile. Corruption, criminal activities, insecurity and many other constraints are conceived key causes of little economic development of Afghanistan. Until and unless serious measures are in place for addressing the mentioned issues, Afghans are anticipated to remain extremely poor and dependent.

To strengthen economy, there is a need to encourage and attract investments in Afghanistan. Investment, especially foreign direct investment is considered an important pillar of economy. In the last decade, Afghanistan has retained stability in its economy through receiving international funds.

However, in the years to come foreign aids are to diminish and the country will be in dire need of other options – one of which is foreign investment - to continue its economic growth. Afghanistan is an attractive market for investors but due to lowest security level here, investment has gone decreasing over the last years – specially the foreign direct investments. The three-decade long conflicts have kept investors away from Afghanistan. This factor is majorly responsible for the fragile economic condition we have today.

If the condition persists as is, it is far difficult for Afghanistan to become self-reliant in economy – for which attracting investment has a vital role. Any prospective private equity investor will examine the risk-return trade-off, the ability to have equity contracts enforced, and the ability to quickly withdraw its stake, if necessary.

If an institutional structure does not exist which protects the equity investor or the long-term investors, investments simply will not be forthcoming. Other factors raise the cost of conducting business in Afghanistan, including endemic corruption, bureaucratic red tape, absence of proper legal infrastructure, etc.

There should be a formal plan for bolstering investment in Afghanistan. The international community and the Afghan government must give sufficient attention to improving the economy by taking measures to increase investment in Afghanistan. For this purpose, ensuring that Afghanistan will not once again fall into chaos such as it faced during 90s would have a critical role.