At times when the international aids to Afghanistan is drying up; the need for Afghan economy to start standing on its feet is being felt more than ever before. After more than a decade of ouster of Taliban from power, our economy remains highly dependent on foreign aids. These aids have made much development and reconstruction works possible for the Afghan people, although existence of corruption has deeply impacted their efficacy.
As Afghanistan is moving into the transition area, it must plan for sustainability of its economy in order to reduce reliance on international funds. The international community has committed to provide $16 billion of aid after 2014 for supporting Afghanistan’s economic, social, education and infra-structure development. Provided the corruption can be curbed and a solution to improve the security condition can be reached, coming years will provide golden opportunity for Afghanistan to develop its economy.
Another important area that should be under focus is attraction of foreign direct investment (FDI). Afghanistan requires investment in many areas. Through FDI, not only our economy will grow but also employment opportunities can be created. Creating job opportunities through such channels is crucial at times when more than 40,000 Afghans who are working with various foreign organizations are expected to go jobless and the general unemployment rate might go high, after withdrawal of majority of international civilian and military personnel from Afghanistan by the end of 2014.
It is quite welcoming that several Indian firms have shown interest to invest in Afghanistan. According to Afghanistan Investment Support Agency (AISA), officials of seventeen Indian companies have completed their visit to some provinces where they assessed the investment opportunities. After the assessments they have agreed to invest in the country.
The investment is expected to take place in sectors like mining, information technology, agriculture and livestock industries and logistics as these are considered fast growing sectors in Afghanistan. Experts think that with these new investments, the Indo-Afghan trade will cross the $1 billion mark within the next two years.
Insecurity remains as the greatest hurdle to economic development and FDI in Afghanistan. Security situation has been escalating in Afghanistan and with many planning to the leave the country. Nonetheless, intentions shown by Indian firms are bold and courageous and indicate that the people and government of India are in favor of development, reconstruction, peace and stability in Afghanistan. The Afghan government must encourage and facilitate businesses that despite the prevailing security condition are ready to invest in Afghanistan.