Because the Taliban don’t publish anything like quarterly financial reports, the sources of all this wealth are difficult to clearly pin down, but multiple news reports suggest a significant chunk comes from black and grey markets involving illegal mining, the drugs trade, and real estate. Surprisingly, a significant portion of their income—15 percent, which is more than $240 million—comes from generous “donations.”Some of these donations come from wealthy sponsors in Pakistan and the Middle East and a “network of individuals, companies, mosques and madrasas known to provide finances and money-laundering on behalf of the Taliban,” according to a 2019 United Nations Security Council (UN) report. Many of these charities are listed on the U.S. Treasury Department’s list of groups that fund terrorism, including the Taliban. “The Gulf region also remains important to the Taliban as a location where drug revenue can be laundered through legal structures belonging to local Afghan expatriates,” the UN said, adding that these networks brought the Taliban into a “systematic engagement and partnership with Afghan organised criminals.”“There’s a notion that the Taliban are simple-minded jihadis who live in caves and operate from there. That’s complete nonsense,” said Gretchen Peters from the Center on Illicit Networks and Transnational Organized Crime.
The Taliban’s first regime—characterised by banned entertainment, harsh punishments and restricted access to the internet—was once labelled “the dark ages”. But U.S. intelligence reports showed that the group was actually doing pretty well for itself. “For years, Taliban’s commanders were living in expensive compounds in Pakistan, driving around in Land Rovers, and sending their kids to private schools,” said Peters, adding that the flawed perception of their supposedly austere lifestyles meant “nobody bothered to follow the money.”Some of Taliban’s donations come from wealthy sponsors in Pakistan and the Middle East, and a “network of individuals, companies, mosques and madrasas known to provide finances and money-laundering on behalf of the Taliban,” according to a 2019 UN Security Council report.
There’s been some progress. The Afghan Threat Finance Cell, which falls under the U.S. Treasury and the Department of Defense, was set up in 2008 to monitor Taliban financing. It unearthed several cases of high-level corruption, including links between the Taliban and the previous Afghan government.Despite the efforts, Peters said that the monitoring was insufficient.“In a war effort that has been defined more by its strategic failures than successes, one of its greatest failures has been to understand how the Taliban is making the money, how they’re hiding it, and comprehensively using it,” she said. “It’s been a complete and abject failure by the U.S. intelligence and their allies.”Haroun Mir, the director of Afghanistan’s Center of Research and Policy Studies, told NPR that he once asked Bahrain’s foreign minister what can be done to stop money flow from the Gulf countries to the Taliban. The minister reportedly said that there was “no mechanism in the region to monitor the transfer of charity funding.”“In a war effort that was defined more by its strategic failures than successes, one of its greatest failures was to understand how the Taliban is making the money, how they’re hiding it, and comprehensively using it,” said Peters.
“Even if such investments were to occur, they cannot replace the combined financial firepower of the main bilateral and multilateral donor agencies,” he wrote. “The Taliban must negotiate with such partners if they expect to be able to access international reserves or receive donor funding. That will require adherence to global standards of governance and education for women, among other issues.”Analysts fear that as the Afghan economy deteriorates, the people of Afghanistan will suffer the most. The G7 nations are currently mulling a decision to recognise the Taliban, or sanction them. Legitimacy, said U.S. President Joe Biden on Sunday, would mean “additional help in terms of economic assistance, trade, and a whole range of things.” Felbab-Brown said as Afghanistan’s economy falters, a blanket sanction might not hurt the Taliban as much as the people of Afghanistan. But tying aid to the preservation of human rights was a “fantasy. It’s not going to happen.” She recommended that instead, the aid needs to be used conditionally instead to prevent the worst restrictions on human rights.“Instead of removing all sanctions at once, only a part of the IMF or some of the World Bank money is released for a specific desired policy from the Taliban,” she explained.“The Taliban may survive the pressures and isolation. But in a country already ravaged by poverty and malnourishment, the sanctions will hurt the people.”Follow Pallavi Pundir on Twitter.“The Taliban has some experience with evading international financial system. But they don’t have experience with Afghanistan’s macroeconomic policies, or how to run the central bank,” said Vanda Felbab-Brown from Brooking’s Institution.