In post-conflict countries like Afghanistan, investment plays a very crucial role in boosting their economic conditions. Investments both external and domestic form the backbone of a self-reliant economy. The more foreign organizations, larger business firms, multi-national companies and successful entrepreneurs are attracted towards investing in a country, the more it will be effective in boosting business activities and adding to the government’s revenues of that country. Unfortunately, although Afghanistan has put behind foreign occupation, civil war and then the rule of Taliban, this country is still not an attractive place for large foreign investors.

The Afghan economy is highly dependent on international aids. As is the case with security situation, Afghanistan’s national economy might also collapse all it once if the international community stops supporting it. This is no less than a national tragedy for the country. However, the government has reluctantly acted to lay strong economic foundations over the past 12 years.

Before investing in a country, any business would analyze the risk factors and in Afghanistan making investment is highly risky. The businessmen would see the ground realities in the country not the verbal promises and assurance of its authorities.

Actually, Foreign Direct Investment is directly related to the political and security situation of a country. In Afghanistan, the security situation is at its worst. This could be better, if the government had logically formulated its policies, especially towards the insurgents.

Specifically speaking, it is the Taliban who are responsible for the deteriorating security situation. For a part of their success, the way the government has been dealing with them is the main reason. The Taliban have been killing thousands of innocent people each year and instead of being prosecuted and sentenced to severe punishments, they are being set free in a way that it feels as there is no law in the country. This is how the government policies have been sophisticating the business and investment environment in the country.

Both the domestic and foreign business firms currently operating in Afghanistan are worried about growing insecurity and uncertainty about the future. Therefore, economic development of Afghanistan is highly fragile at times when the government policies are inclined more towards the Taliban than towards the hands that have supported it and the country for the last decade.