New US Strategy Needed in Afghanistan and Pakistan

The USA occupied Afghanistan in November 2001 and its almost more than 6 years since then and yet the United States has failed to win the hearts and minds of a substantial part of Afghan populace. The reason lies in abject failure of USA's economic policy. This in turn has led to a counterproductive situation.

There is nothing inevitable in history but those who cannot identify the critical time span in any crisis and who fail to seize it by the horns are bound to fail. Such unfortunately has been the case with US strategy in Afghanistan. The US president failed to find the right strategic talent for Afghanistan and thus thrust mediocre US policy makers on Afghanistan who know , nor recognise anything higher than their shallow mediocrity !

The main thrust of USA's policy was to construct roads and schools and clinics. These were important but no substantial class of stakeholders which had a vested interest in success of US policy inside Afghanistan was created. No major employment opportunities were created. No major effort was made to encourage private enterprise. No major attempt was made to privatise Afghanistan's main economic potential i.e its massive custom revenues most of which do not land in government coffers and are skimmed away by corrupt custom officials as bribes and by smugglers as profits once Afghan imports are re-exported i.e smuggled to Pakistan.

US approach in short was bureaucratic, conservative and in final summing up timid ! Bearing Point a large US firm got the major contract for economic reform. It hired Americans and expatriates who would not have got any decent job in USA or even a medium level country. In addition they hired some Afghan Americans who came to Afghanistan for a short term period , to make a quick buck and go back to their relatively far more comfortable permanent places on the California coast.

The magnum bonum achievement of US advisors was creation of AISA a government agency funded and administered by USA and some European donors to regulate licensing and setting up of industrial parks. Again since little private enterprise was involved with Bearing Point being in the background and making a good buck hiring Afghans with US or Canadian passports at relatively low salaries and some local Afghans.The main industrial project of AISA industrial parks in Jalalabad , Kabul ,Kandahar ,Herat and Mazar took six years to be awarded and will take another one year to complete. Having said that it is good if AISA has licensing/registration alone and Industrial Parks are handled by a highly professional international company with full support of the US Government and with zero percent interference from the Afghan Government.

A better approach could have been to award the contract to a private firm on turnkey basis with a profit incentive instead of hiring Afghans on fixed salary in AISA. This combined with a 30 or 50 year incentive to industries to export quota free to USA , combined with a buy back guarantee with USA with the condition that all quality standards were met would have let to creation of industrial parks in Afghanistan by mid 2004 and by mid 2005 or late 2005 many hundreds of industrial units would have been functioning in Afghanistan. Thus at least permanent long term employment could have been created for 200,000 to 500,000 Afghans.Instead the main thrust of US economic policy was on roads ,schools and clinics which benefitted a coupe of construction companies of foreign companies and created a low income short term employment for an Afghan labour which could not have exceeded 300,000 at any time.Schools and clinics awarded to LBGI were in turn sub contracted by LBGI to Afghan contractors , many being US and European passport holders at about 25 % to 30 % of the total cost. These contractors in turn sub contracted these to local Afghan petty contractors at low rates.Thus hardly 10 % of the total amount earmarked for these schools and clinics were actually spent resulting in leaking and collapsing roofs and highly sub standard construction. This faux pas was well covered by the Washington Post in late 2005.

It has been estimated that the contraband non drug mafia in Afghanistan is larger than the drug mafia of Afghanistan.In turn both the mafias have overlapping key figures involved in both the trades.It has been estimated that some 80 % of Afghanistan's imports are smuggled back to neighbouring Pakistan where custom duties are very high. The United States made a somewhat lukewarm effort to re-structure the low paid and highly corrupt and inefficient Afghan customs . Another approach could have been to award the custom collection and enforcement task to an international private firm like Cotecna or SGS.This way Afghan custom revenues could have been multiplied by 400 % to 600 % and Afghan Government could have been made financially far stronger, while also reducing its overwhelming dependence on foreign aid. It is significant to note that many key Afghan governors on the bordering provinces as well as some ministers are known to have a close link with the non drug contraband mafia.

During the past six years many Afghans and many Pashtuns saw daisy cutters , Chinooks and armoured cars but no one saw the benefits of USA's advent in Afghanistan. Both the countries got a lot of hot lead and shrapnels but no Marshall Plan other than a Marshal being created in Afghanistan ! In Afghanistan this was a case of lack of vision on part of US Government. In Pakistan which got more than 10 Billion USD in aid , the corrupt non Pashtun dominated government spent a very nominal part of this aid on the Pashtun areas despite the fact that this aid was meant to basically pacify the Pashtun areas of Pakistan which are definitely the centre of gravity of Al Qaeda/Taliban. No special export zone with the right to quota free guaranteed export reinforced by buy back guarantees was created in the NWFP and Balochistan provinces of Pakistan.These zones could have gone a long way in creating employment and prosperity in the Pashtun areas and vastly reduce the sense of alienation in the Pashtuns. The reasons for this were more ethnic than anything and the USA made no effort to arm twist the tinpot Musharraf regime into spending this money on the Pashtun areas of Pakistan.The only investment that Pakistan's non Pashtun dominated government made on the Pashtun areas was in form of Cobra helicopter munitions,7.62 mm bullets,155 mm artillery etc in pounding the Pashtun areas indiscriminately, targeting mostly non combatants women and children.

In addition no major effort was made to create a stock exchange or float investment bonds giving good interest which could have created a substantial class in Afghanistan whose success and prosperity was linked to US policies in Afghanistan.It was just a matter of a little imagination and printing bonds with the backing and sovereign guarantee of US government for payment of interest in USD for a period of 10 to 20 years. Unfortunately there was no brilliant man like Nixon in the US leadership who could think of a coup like delinking of goald standard in the early 70s. A condition could have been imposed that in order to buy these Afghanistan Fund Bons all companies had to register in Afghanistan thus bringing money to Afghanistan as well as a long term class of stake holders in Afghanistan.

I developed friendship with a US official in Kabul in 2005.We discussed many aspects of US policy in Afghanistan. In the end the US officer pessimistically concluded that his superiors were a bunch of w_t p______s . Similar ideas were expressed by many US military officers I met in Afghanistan in the course of military contracting in course of 4 years.

It may be added that the same policy should have been followed in Pakistan , particularly its tribal areas creating industrial zones guaranteeing 10 to 20 years quota free exports to USA with buy back guarantee instead of doling out many billion US Dollars to Pakistans highly corrupt military junta. This way employment would have been created and potential recruits of Al Qaeda and Taliban given decent risk free long term jobs in the industrial units established as part of this policy.

No major effort was made to regulate the visa regime. A Work Permit was issued by the Ministry of Labour for visa extension but this permit was not honoured by the Ministry of Interior when AISA issued them visa extension letters for multiple visa in many cases thus restricting in country and out country movement of expatriates. The Afghan Embassies particularly those in Pakistan followed yet another highly absurd practice of granting a 15 day single entry visa to all applicants with the condition that after they had visited Afghanistan once and exited they could not apply for another Afghan visa till the three month period of the visa expired. Thus an expatriate with a valid Afghan Work Permit was told that work permit had no legal value in eyes of Afghan Embassy Staff and that they could not apply for another visa till the three months visa validity period expired.

Afghanistan and even Pakistan may be compared to a sort of West Germany and South Korea for USA. Any withdrawal from Afghanistan would straight away lead to re-occupation of the country by Taliban with an active re-entry of Russia,Iran and India on side of non Taliban forces. The Afghan Army needs at least 10 to 15 years to recover its military effectiveness.Thus all this would be a 100 percent diasaster for USA. The only viable strategy for USA in Afghanistan is to settle in for next two decades.Introduce a Marshall Plan which creates employment and prosperity .Introduce public bonds with good interest that make US presence in Afghanistan a cause of progress and prosperity for many.Keep a watchful eye on the region.Build up the capacity of the Afghan National Army and Police. Any withdrawal by USA would be a cardinal strategic blunder. Something which the USA cannot afford and an event which would constitute a Clausewitzian culminating point of USA.

Further the USA has to reinforce the democratic forces in Pakistan and Afghanistan while making use of Pakistan's mercenary army which is still far more cheaper than any Western force even if their pay is tripled by US aid. At the same time the Pakistani forces being more than 60 % non Pashtuns have to be restrained from causing collateral damage.

The USA has invested many billions in Afghanistan but its priorities are not clear. Vaccillation , procractination and supreme indecision remain the hallmarks of US policy in Afghanistan.