Sustainability and Transition in Afghanistan. A ...

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Toryalai Wesa is questioned as well. With so much uncertainty, Afghans are reverting to the past to find meaning and answers to their current dilemmas, fearing ...
Suhrke, Astri, and Aziz Hakimi. 2011. Sustainability and Transition in Afghanistan. A political economy analysis. Commissioned study for the World Bank, Kabul Office.

DRAFT 19.08.08 (as corrected). Sustainability and Transition in Afghanistan. A political economy analysis1 Astri Suhrke and Aziz Hakimi

1. INTRODUCTION Billions of dollars in international assistance to Afghanistan in the past decade have created a rentier state that is unprecedented in the country‟s history and highly dependent upon international military forces to fight armed opposition groups. Given that the NATO-led combat forces are scheduled to be out by 2014, and that the related war-and-aid economy which has developed probably will mirror the military drawdown, a key question is how the Transition will affect present political elite structures and the implications this will have for social order. The question breaks down into several analytical paths. The starting point must be the social relations and material basis that underpin the present elite structures, and their degree of dependence upon the international presence. This permits a historically informed extrapolation with respect to (i) strategies of elite adaptation to build/maintain power (versus exit or decline), and (ii) the political outcomes with respect to center-periphery relations within the country and social (dis)order. The wider context for elite adaptation will influence elite strategies and outcomes in important respects. Present elites have to adapt in the face of an insurgency that keeps advancing despite heavy losses and repeated tactical defeats inflicted by the Coalition forces, and in a regional context of international rivalries that historically has linked into and exacerbated internal Afghan conflict. The uncertainties associated with the Transition are thus compounded even though some of the groups most likely to be affected have anticipated a reduced Western level of support for some time and started to develop alternative bases of power. A main theme emerging from the analysis of elite structures and adaptation in this paper is the growing importance of the political arena in elite contestation after 2001. A heavy international hand in the construction of the post-Bonn order is one reason; the remarkable transformation of many ex-military commanders into skillful politicians and entrepreneurs is another, although the resort to „armed politics‟ has been widespread. The importance of capturing „the mask of the state‟ (Abrams, 1988) as a tool for accumulating wealth, and hence more political power, will likely make competition for access to the formal political institutions a principal focus for elite adaptation to reduced Western patronage and a shrinking war-and-aid economy. Intra-elite politics may well grow more confrontational and violent due to growing uncertainties about the future, the increasing militarization of Afghan society, and the growing saliency of the illegal economy as a source of wealth. Another important strategy of adaptation is to re- negotiate terms of relations with erstwhile patrons and adversaries – at home and abroad. Some elite groups are positioning themselves as key local counterparts in a new, post-2014 contract with the US. Others are seeking 1

The paper is a desk-study based on secondary sources.

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diplomatic support in the region, including from the Shanghai Cooperation Council. President Karzai is leading a faction that stresses the need to negotiate with the Taliban. The relationship between Kabul and the provinces is another major element in present elite structures. Major powerbrokers on the national level have a local base, and support in Kabul is a multiplier of power for a provincial strongman. Already there are signs that the Transition is straining current centre-periphery elite „pacts‟. The outcomes of these adaptations in terms of social order or violence will depend on the broader context, in the first instance the state of the insurgency. Can a settlement be negotiated? Will the present elites divide along ethnic lines in their approach to the insurgency and control of the state? The international context is the second important element. Historically, the worst outcomes have occurred when internal conflict and external rivalries intersected in a mutually reinforcing dynamic to produce internationalized civil war (1970s-1990s). On the other hand, international rivalry over Afghanistan has co-existed with relative internal peace when the center was able to hold (most of the period 1747-1978). This paper explores these questions at both the national and local levels. Section I examines elite structures and adaptation at the national level, and possible scenarios that take into account the state of the insurgency and role of external actors. Section II takes the analysis to the provincial level, following a similar line of inquiry with respect to adaptation and social outcomes on the provincial level. Three provinces have been selected – Nangarhar, Balkh and Kandahar. These provinces are differently linked into the new political order that developed after 2001 and its war-and-aid economy. As such they represent a reasonably wide spectrum of cases, although they may not be representative in a generic sense of the term. The qualitative nature of the data makes it difficult to construct a graded impact analysis linked to reductions in Western aid and military presence on a scale of high-medium-low. Instead, the study is based on the following assumptions: (1) Western combat forces will be withdrawn by 2014 as scheduled, probably leaving a residual force for training and possibly counter-terrorist purposes unless a peace settlement is reached that prohibits a foreign military presence; (2) economic assistance will be reduced to more „normal levels‟ for postconflict countries; and (3) the insurgents are unlikely to capture Kabul and establish a national government in the foreseeable future. The military drawdown and related changes in the period up to 2014 is referred to as the Transition.

I: THE NATIONAL LEVEL A: Elites in the post-2001 order Some social groups have become prominent at the local and national level in the post-Taliban order by virtue of their initial links with the US-led invasion. As military or political allies of the US-led coalition – and as key delegates at the Bonn conference which laid the framework for the new order – these groups gained access to key positions in the state apparatus and associated institutions established after 2001. The division of cabinet positions in the Bonn Agreement, an astounding total of 24, indicates the importance attached to holding formal political positions in the post-war order as well as a tacit intra-elite bargain to divide the spoils of victory. Control over the structures of the state ensured access to domestic and international resources and legitimated the accumulation of power and wealth through 2

coercive or non-economic means, ostensibly in the name of the Afghan state, but in fact dominated by a variety of personality-driven, strongman-dominated commercial and military networks held together by the administration of Hamid Karzai. Formal political power subsequently served as a critical instrument for generating more power and wealth. Officials holding high positions constructed informal institutions of governance by appointing their followers in the national and sub-national administrative apparatus. Informal institutions based in part on solidarity ties related to family, religion, armed followers during previous wars, and ethnicity - but also on more recent pragmatic alliances adapted to the Western-assisted statebuilding project - were used to consolidate and expand elite positions. The material basis of these structures was diverse. The illegal economy based on drugs and smuggling was obviously important (the value of the drug economy was estimated to be equivalent to over one-third of the licit GDP in the first part of the decade). But the boom economy generated by the growing Western military presence and large aid inflows for reconstruction, statebuilding and development also offered opportunities for huge profit-making for those strategically placed. The sudden influx of very substantial funds and diverse, and sometimes chaotic, channels of donor disbursement, combined with soft institutions in a society racked by almost three decades of upheavals, invited Afghan elites to tap the soft spots of the rentier state. Some figures give a sense of the magnitudes involved [see Bank /WP report]). Proximity to these aid flows on the Afghan side was determined by several factors, most importantly political position, military power, and technocratic expertise. These attributes consequently came to define key segments of the post-2001 elites. As is evident from the list below, the elites are not all „new‟ in a temporal sense – many key individuals are now old men who established their power base in the struggle against the communists, which started in the late 1970s. Others are young. A new generation of local military strongmen in their late 20s and early 30s has emerged on the back of the war, especially in the South. Both generations are mostly non-traditional in the sense that authority and power do not as in previous times primarily flow from tribal leadership or religious legitimacy. Tribal structures have been progressively weakened by the upheavals of war and attempted social reforms during the past four decades (including the last), while the clergy as an institution has been divided, marginalized by the government, or radicalized by the armed opposition to support the counter-elites. Although boundaries are fluid and overlapping, social origins constitute a point of departure for identifying some segments of the current elites; for other segments function is more useful.

„Warlords‟2 The principal mujahedin leaders whose power originated in their ability to lead the armed struggle against the communists, and subsequently against each other, made a fairly smooth transition into the political arena after 2001. Having aligned with the US during the invasion, they were well represented at the Bonn conference, and thus in a position to claim their part 2

A much-abused and ambiguous term, it is used here to denote the origins of power.

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of formal state power in the new order. Others were subsequently included through appointments by the interim and later elected President, Hamid Karzai, a man who himself had neither a combat background nor a strong local power base during the 1980s Jihad or the factional fighting of the early 1990s. The so-called 1st tier „warlords‟ of the older generation rose to prominence starting from a local base, but with decisive foreign support. The source varied. During the 1990s, all the neighbouring countries as well as Russia and India contributed to one or another faction. In the 1980s, the US led much of the rest of the world in Europe, Asia and the Middle East in support for the mujahedin against the communists. After 2001, these warlords owed their initial position to US support qua partners in the war against the Taliban and al-Qaeda. Subsequently, some consolidated their power primarily by developing their local base (e.g. Dostum, Ismail Khan, Sherzai, Atta, Mohaqiq). But even the strongmen most directly dependent on their local domain maintained their links to the centre, at the very least in order to protect that base, and some have aspired to national-level positions. Many diversified into electoral politics and were elected to the first Parliament in 2005. Local strongmen whose provincial domain included a large Coalition force presence were particularly well placed to benefit from the foreign presence, and some gained their „strongman‟ rank and reputation as a direct result of their ties to the foreign military forces (see sec. II). Others made most of the opportunities offered by national level positions. Fahim Qasim positioned himself as Minister of Defence in the first administration after the 2001 invasion, at a time when he was still the powerful commander of the Northern Alliance forces and his army was in Kabul. Like most of the other „warlords‟, Fahim used his formal political position and initial proximity to US forces to diversify and expand power through a distinctly primitive accumulation of wealth that relied on threats and coercion, and the power of official appointments to support some local strongmen while weakening others (Giustozzi and Orsini, 2009). As Minister of Defence (2002-2004), Fahim filled the higher ranks of the army with personal supporters, mostly Tajiks who belonged to his own political faction (HRW 2004). The practices reportedly associated with Fahim to establish his formidable business enterprise in construction, real estate and other areas (e.g. fuel/energy, banking, security companies, and supplies to US/NATO forces) are indicative. Coercion is used to limit competition on bidding to secure contracts (potential competitors are advised not to bid against Fahim‟s companies). Privileged access to bank credit permits risky ventures at low or no cost (e.g. to buy up state owned companies that are privatized). Ties to illegal transactions secures rent (land-grabbing in Kabul has been documented), and ties to the illegal economy generate windfall profits. Formal political power secures continued privileged access to influence contracts, appointments, and location of aid projects, and control over smuggling routes, all of which enter a complicated exchange of favors and benefits that mostly trickle upwards. While Fahim was forced out as Defence Minister in 2004, largely as a result of international pressure, his second-in-command, Bismullah Khan, remained for eight years as chief of staff of the Afghan National Army. In the Ministry of Interior, fellow Pansjiris linked to Fahim in ethnically-based solidarity networks has dominated the Police Department from December 2001 and onwards. Fahim himself returned to a high, formal position of power in 2009, when Karzai, in a tacit intra-elite bargain to create ethnic balance - but also to reduce reliance on the West - selected him as Vice-President. The next year, Bismullah Khan was appointed Minister of the Interior.

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A new generation of local strongmen with armed followers has emerged on the back of the war economy, particularly in the South (see sec.II C). These commanders and their armed followers have offered services to the Coalition forces, such as protection of international military convoys. Four of them have private security company contracts to guard different segments of the Kabul-Kandahar-Herat ringroad. Holding formal government positions is a key step to further power, however, and key local strongmen have done so by appointments to the provincial police and the Border Police (e.g. Matiullah Khan and Abdul Raziq).

Political personalities The „old guard‟ leaders of the political factions that fought the communists, and later each other, have used the allocation of state positions after the victory in 2001 to develop the power of their factions, as well as that of their families and related solidarity networks. „Old guard‟ leaders and their lieutenants wield continued power derived from their status and ability to mobilize „jihadist‟ factions, access to or control of state offices (typically by placing a relative in a high administrative position), and representation in elected institutions. While the factions do not operate formally as political parties, they are important frameworks for patronage politics and, particularly during election times, the use of coercion in the form of „armed politics‟ (Giustozzi, 2011) . Accessing political and state power, in turn, can be used to accumulate wealth, which in turn is used to pass on patronage and buy further political support during elections and parliamentary nominations. The old political factions of the Northern Alliance have adapted particulrly well to the post2001 order, using their initial advantage in 2001 to achieve unprecedented power for the nonPashtun ethnic groups in national politcs and state administration. A younger generation of followers have appeared in high appointed or elected office (e.g. Qanoni, Abdullah, and Saleh) alongside the „old guard‟ (Rabbani, Khalili). The rise to prominence of the younger generation reflects in part their skills as powerbrokers for the international community in the transformational social project agreed to in Bonn, but also their factional power base which is more broadly founded. Karzai, who was nominated by the Americans to lead the first post-2001 administration, has had an even more remarkable rise to power. A quintessential „political entrepreneur‟, Karzai is the most powerful of the new political leaders who have emerged among the post-2001 elites. While belonging to a prominent family, he had no armed following of his own (which is why he was acceptable to the other parties in Bonn), and he was initially heavily dependent upon the Western economic, military and political presence. Over time, however, Karzai skillfully used the Western presence to enhance and diversify his power base to reduce this dependence. Large-scale patronage, patriarchal politics, and ruthless divide and rule tactics with elements of targeted and limited violence have been key elements in this strategy. The system has been partly self-financing through the use of patronage and formal positions of power to access the war-and-aid economy, especially in Kandahar through his half-brother Ahmed Wali Karzai (see sec. II.C) and the far-flung business empire developed and managed by other members of the family. Economic power was also used to bank roll elections, as demonstrated by the deep involvement of presidential advisors in the Kabul Bank affair. Smaller „new‟ political entrepreneurs have risen to prominence on by virtue of their ability to navigate in the heavily internationalized arena after 2001 and making themselves useful as smaller brokers to either the internationals or the new national leaders. Appointment in the 5

sub-national administration (e.g. as a governor) is an important step up the ladder as it permits further accumulation of economic and political capital through influence over local appointments and allocation of contracts. Appointment to provinces with a large foreign military presence opens for influence over huge, off-budget contracts and is a most valuable access point to more power. The smaller political entrepreneur is most directly dependent on the national political leader who secured his appointment, and to whom allegiance is owed (e.g.in the form of votes), and secondarily on the Western presence.

Technocrats Technocrats form a small, new and distinctly post-2001 element among the Afghan elites. Many are „returnees‟ with expertise, educational and employment ties to the West. As such, they were important for the realization of the transformational, statebuilding project launched in Bonn and received strong supported from Western donors and the international financial institutions. International support was the principal power base of prominent technocrats in the early years after Bonn, such as Ashraf Ghani. Other technocrats remained longer in important ministerial positions because they were not only regarded by donors as effective administrators with a strong commitment to the Bonn-agenda, but because they developed a domestic power base, albeit insecure, with ties to the President‟s Office (e.g. Haneef Atmar, Spanta). Other technocrats appeared in a more fleeting role as advisors in the President‟s office, but were controversial because of their extraordinarily high fees. Technocrats in high-level, national positions made significant contribution to the reforms that were instituted in the first part of the decade and laid the foundation for the principal achievements in delivery or services and creation of state capacity that are cited today. By most measures, they would be considered part of the political elite. By the end of the decade, they had been supplemented with a new layer of middle-and high-level civil servants. While on the margins of the political elite, they constitute a technical-administrative elite that is important to keep the state apparatus functioning at its present level. The operation of this „second civil service‟ is directly dependent on international donors, who pay their salaries in whole or in full (Tully and Hogg, 2009) (Tully and Hogg 2009). Top technocrats placed in ministerial positions did not always rise above politics of patronage (e.g. a Minister of Finance originally from Nangarhar staffed many positions in his ministry with Nangarharis). Leading technocrats also diversified by entering the political arena, one of them by running for president in 2009, another by forming a political party after losing his position as minister. In whichever capacity – technocrat cum politician or only the first – donors look to the technocrats during the Transition as the first line of defense against „old guard‟ personalities who are either ineffective or approach governance in a strictly patrimonial manner to use public office for private gain. „Drug barons‟ A source of a much of the world‟s heroin, the poppy economy „infiltrates and seriously affects Afghanistan‟s economy, state, society and politics‟ (Byrd, 2006). The formidable size of the illegal economy relative to the licit GDP leaves no doubt that state protection is extended from the district level to the very top. No major figures have been arrested to date, however, despite the introduction with donor support of a counter-narcotics law and a special 6

counter-narcotics tribunal. Only much smaller figures have been caught in the net, a development that led the Parliament in 2005 to remove heavy fines because they were „disproportionately imposed on ….lower level couriers.‟ (Hartmann, 2011) . The more powerful groups at the local and national levels - the „drug barons‟ in popular language - are the higher level traffickers, or what a UNODC report calls „the trafficking elite‟ (Shaw, 2006) . In the South, which since mid-decade has been the centre for trading, this elite consisted at the time of the study of approximately 15 individuals who generally styled themselves as businessmen, but were a „mix of businessmen, former political players, religious figures, former NGO heads, and simple „bandits‟.” ((Shaw, 2006). Situated near the apex of the pyramid of protection and patronage, this elite connected the „underworld‟ of organized traders with the „upperworld‟ of political figures and officials who extended protection. The system enabled persons in formal positions of power, particularly at the higher levels of the pyramid, to maintain a proper distance from the illegal activity. In reality, protection and payoffs permeated the system, from the producer to the high-value end of the chain. Transporting a high-value, illegal product requires security, which logically implicates a number of institutional actors (the national police, the Border Patrol Police, the Ministry of Interior where power of police appointments formally reside), but also a range of political actors that influence such appointments (political leaders, governors), as well as private security companies that guard critical segments of the road transport system, and the Coalition forces that work with local strongmen who have built their power of patronage with earnings from drug smuggling. With such a powerful array of protectors, it is hardly surprising that the counter-narcotics tribunal has proved impotent. European mentors to the tribunal have noticed with dismay that cases against potentially major figures have been aborted. The money that flushes through this system finances both personal wealth and political power through patronage, election support and maintenance of armed followers. The mechanics on the provincial level are traced in the case studies below (see sec II). Probable manifestations on the national level are indicated by ostentatious spending, e.g. in the new housing estates in Kabul‟s Sherpur neighborhood, and the suitcases with cash that reportedly are carried through the customs in the Gulf states (a former Vice President is said to have arrived in Abu Dhabi with 52 million dollars.)3 Contractors and consultants The war- and aid economy has stimulated the growth a large sector of Afghan contractors and consultants. Contracts authorized by the US Department of Defense totaling 11.5 billion dollars in two years alone (2007-9), indicate the scale of opportunities for individuals with business acumen and relevant contacts (SIGAR, 2010). When province-based Coalition forces offered contracts the bidding process could be opaque or non-existent, and opportunities for individuals who functioned as local interlocutors for the international forces were near-legendary (see sec II). Bidding for big international contracts on the national level faced competition with international companies, but Afghan companies made big inroads in sectors such as construction, security companies, banking and transport. Windfall profit could

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The New York Times. 29.11.2010.

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be made; in transport, for instance, by the loophole offered by ISAF regulations that supplies hauled to international forces were not subject to import duty. The growing middle class, particularly in Kabul, has been one result of the economic boom in the contracting and consulting business. But members of the political elite and armed strongmen have benefitted disproportionately. The lucrative private security company industry has enabled local strongmen to expand and outfit militias in a legitimate business, a capacity that has been used for purposes of „armed politics‟ and to accumulate wealth, as evident in Kandahar. Family members of prominent national leaders have entered the security company business as well (e.g. the son of Defence Minister Wardak and relatives of President Karzai). The nexus between commercial interests and high political office yields benefits in both the economic and political sphere. In this respect the business empire of the Karzai family may be typical, although a pattern writ-large given that Karzai is president and one of his brothers an exceptionally capable businessman. The brother, Mahmoud Karzai, had gained skills and knowledge of Western business practices while living in the United States, and returned to Afghanistan after 2001. Mahmoud ran the increasingly far-flung business operations of the family, with investments in real estate, banking, a cement factory and coal mining, and an exclusive sales agreement with Toyota Corporation. While Mahmoud is an important figure in the legitimate business arena, the family‟s business operations suggest the beneficial impact of high office on business ventures. It also suggests „the utility of commercial interests for political gain‟ (Forsberg, 2010). Business deals cemented a particularly important political alliance in 2009, when Karzai invited the Northern Alliance leader Fahim to be his Vice-Presidential candidate in the forthcoming elections. Both the Karzai and the Fahim families owned shares in the infamous Kabul Bank, which channeled millions of dollars into the election campaign.

B. Elite adaptation strategies to the Transition at the national level What likely impact will the scheduled military drawn down and expected shrinking of the war-and-aid economy have on the patterns of intra-elite contestation described so far, and what are the implications for the future political and social order? The present situation and indeed the nature of the Transition itself are so uncertain that some analysts conclude only one thing is clear: „The end game has started, but nobody knows how it will end.‟ (Rashid, 2011) .Current patterns and past history nevertheless suggests some plausible future lines.

Elite contestation over „the mask of the state‟ A reduction of economic political and military support from the West will likely intensify intra-elite contestation over the spoils of power, but there is no obvious reason why the forms would be very different from the present. While typically a mask for informal institutions, formal political power is important. Even (or particularly) armed strongmen and „warlords‟ appreciate the importance of formal political positions. The case of Matiullahh Khan is emblematic. A militia leader in the southern province of Uruzgan, Matiullah became a „local strongman‟ by providing security for Coalition convoys in „his‟ area, assembling a coterie of 8

armed followers, and giving alms to widows and other poor who gathered at the new khan‟s compound. But Matiullah desperately wanted to become provincial chief of police as well – a wish he was finally granted in August 2011. Formal positions can facilitate accumulation of wealth and power by bestowing some legitimacy on that process, but formal positions are also enmeshed in a network of formal rules and institutions that influences the contestation and invites contenders to enter the formal political arena. The smooth transformation of Afghan „warlords‟ into businessmen and politicians is one of the remarkable developments during the past decade. Yet they retained the capacity to use force when necessary, thus not wholly giving up one role for the other. Elite contestation in the legal political arena is currently framed by formal democratic rules. Minimal adherence to these rules is important for international legitimacy, and competition among Afghan elites for support from donors and other international actors will if anything intensify as the Transition and its aftermath take form. Internally as well, formal rules serve as a framework for legitimacy, and the present basic rules are those of a democratic, Islamic republic. A democratic tradition was not entirely invented after 2001. Afghanistan after all got its first constitution in 1923, which provided for an assembly, partly elected and partly appointed (as now), to advise the king in the tradition of deliberative assemblies of tribal elders. The Parliament has emerged as an important arena of elite contestation and as a body that is extremely jealous of its power, particularly in relation to the executive. The stand-off between the Wolesi Jirga and the President after the 2010 parliamentary elections is in this respect a positive sign; political institutions are being taken seriously as important vehicle for the pursuit of power. The last elections further underlined the potential of the Parliament to become an arena for ethnic politics. Non-Pashtun groups made significant gains, mainly because they were better organized than the Pashtuns or the security situation in the North and West permitted a larger turn-out than in the insecure, Pashtun-dominated southern provinces. The electoral upheavals predictably caused conflict, reflecting the growing saliency of identity politics and tension among ethnic groups in Afghanistan during the past three decades – in part as a result of the ethnically-defined violence during the civil war. On the other hand, the Parliament provides a legitimate and non-violent arena for fighting out identity politics, and events after the 2010 elections suggests it is in the process of establishing itself as such. A reduced Western presence may well intensify the intra-elite competition to capture state power and gain representation in elected institutions. Already around 2006-7, when overt strains in relations between the government and its Western allies made Karzai fear that he was losing international support, the president started to recast his political strategy, in the first instance by searching for new, traditional allies among 1st tier „warlords‟ at home. The intensity of the election campaign fought in 2009 is indicative of the inflated value of holding state power in times of great uncertainty. Similarly, the 2010 parliamentary elections were fought more intensely, with more fraud, and more threats or use of force than the 2005 elections. At the present time, a great deal of political activity in Kabul is for the same reason focused on the 2014 presidential elections, with potential candidates positioning themselves, forming and un-forming alliances, or preparing to launch new political movements. In past elections, competing factions have operated in the manner of political machines familiar from earlier periods in Western history, using coercion (including armed force), intimidation, buying of votes and – afterwards – dividing the spoils. This will probably 9

continue, and the political climate as a whole marked by more robust competition for several reasons. First, marked uncertainty about the future is likely to enhance cohesion within groups but harden dividing lines among them as individuals seek safety in the group. Salient boundaries in Afghanistan are family, clan, solidarity networks and, in the outer ring of primordial loyalties, ethnic group. Identity politics in a climate of shrinking available resources, or increasing competition for what is left, tend to sharpen conflict and increase the possibility of violence. Second, Afghan society has become increasing militarized during the past decade. While the armed factions that fought the civil war during the 1990s were formally demobilized, numerous so-called Illegal Armed Groups remained by 2008 when the demobilization program ended (1800 groups with some 120 000 members and 336 000 small and light weapons, according to the UN(Suhrke, 2011). New armed groups have mushroomed in response to Coalition forces demand for aid to fight the insurgency or provide support services. A nation-wide force of local armed units (the Afghan Local Police), numbering between 30,000-40,000 armed men in over 100 districts is being formed with international support as a short-cut to strengthen security in the face of the military drawdown of the Coalition forces and the longer time period required to expand the Afghan National Army (ANA). The target for building up Afghan security forces (army, police, auxiliary police and special forces) by 2014 is around 400 000. The result of this vast and fast expansion will be a very large number of men with arms, but weak institutions. As international mentoring will be limited – particularly of the informal armed groups – and adequate financing of a large army and police force may not be found, a very large number of armed men are potentially available for „armed politics‟ and predatory behaviour. Third, less readily available money from the war-and-aid economy will increase pressure on other sources to finance political contestation. There are two principal sources of wealth, apart from what the elites already have accumulated, and legitimate commercial activity. State revenues are one, principally customs duties, lease of facilities for military bases, or granting of contracts for exploitation of mineral wealth. It is not clear, however, that either of these sources is readily available to national-level elites. A fair amount of customs duties appear to be siphoned off at the point of collection, leaving considerable but reduced revenues for the centre (see Sec II). Future revenue flows to the state will depend upon centre-periphery relations, which already are undergoing change and will likely be further affected by the Transition (see below). Rent of basing facilities under a future Afghan-US security pact as well as major contracts for mineral exploitation are other major sources of central government revenues. Yet the terms and processing of such contracts will be closely scrutinized. The recognized potential for corrupt practices will encourage close monitoring on all sides, by competing Afghan elites (to ensure that a rival faction does not gain), and international authorities and companies (which have similar concerns). The alleged corruption scandal in connection with the recent Aynak copper mine contract is a case in point. US officials accused the Minister of Mines, a Soviet trained technocrat, of taking 32 million dollars in bribes from the Chinese company that won the bid (which the US lost). The Minister was soon replaced with a young, Western-trained banker from an established religious family who had worked closely with the international financial institutions in Kabul. That leaves the illegal economy as the other main source of wealth that can readily be utilized for political gain. The illicit economy unfolds within a structure of protection and patronage that relies on political influence and armed force to extract huge profits. Connecting this 10

structure more closely to political contestation will also make politics more corrupt, criminal and, possibly, violent – a „narco-mafia state‟ in a worst case scenario. A best case scenario on the provincial level is also possible, however (see Sec. II A) There are „softer‟ but important sources of power in the form of diplomatic and political realignment. Karzai has strengthened relations with countries in the region – Iran, Turkey, the Central Asia States and Russia and China in particular – in order to compensate for expected decline in US support to both Afghanistan and himself as a national leader. He also cultivated relations with the Shanghai Cooperation Council (SCO), which includes as members or observers all the principal countries in the region. Afghanistan is linked through a Contact Group. Some elites opposed to Karzai are positioning themselves on the other side of the international spectrum as partners in a redefined but strong Afghan-American relationship structured around US support and basing facilities in the country. Leading this group are technocrats whose initial political base was, and to a large extent remains, Western support for their role as reformers in the statebuilding venture as defined by the Bonn Agreement. Karzai‟s call for negotiations with the Taliban is perhaps the most important adaptive strategy in his portfolio. How this and other elite strategies will pan out depends to a large extent on factors beyond their control, above all the course of the insurgency and the role of external actors towards the present war and its possible settlement. A general discussion of these matters is beyond the scope of this report. They have been examined in detail elsewhere (e.g. Brahimi-Pickering Report 2011), and will be discussed here only briefly in relation to elite adaptive strategies and the implications for social and political order.

The Insurgency By 2011, the war had entered a costly stalemate. The Coalition forces had made tactical gains, but strategic victory remained elusive. The insurgents had expanded their geographic scope to cover most of the country, making alliances with other rebel groups and mobilizing beyond the Taliban‟s traditional Pashtun base. Costly stalemates invite negotiations. President Obama‟s decision in 2009 to increase troops while announcing a deadline for withdrawal was a clear indication that he was looking for a settlement if „the surge‟ did not rapidly defeat the insurgents. By mid-2011, the signs of impending talks were stronger than the evidence of a defeated insurgency, but the pace, scope and nature of an eventual settlement remained highly uncertain. Attitudes among elites in Kabul were divided (Nixon, 2011). Karzai led the advocates of negotiations and reconciliation with the Taliban; a perspective generally shared in the Peace Jirga of prominent personalities that he established. On the other side, ex-warlords of the Northern Alliance and Western-oriented technocrats lead outspoken critics of talks and only accept „reconciliation‟ on terms equivalent to surrender. Much less is known of the disposition of the Afghan belligerent forces. On the insurgent side, it appears the American kill-or-capture strategy has decimated the middle ranks of „the old Taliban‟, making room for a new generation of radicalized commanders supported by foreign fighters. The „old Taliban‟ are still in charge of the political dialogue and appear interested in negotiations. For all of them, the scheduled withdrawal of US-led military forces from Afghanistan removes a principal ideological justification for fighting, thus strengthening the prospects for an end to the war. The insurgents appear set on capturing Kandahar, the heartland of the Taliban, and possibly other areas of the South (see Sec II.C), but in other 11

respects a compromise deal might be possible. As an internally diverse movement relying on guerrilla tactics, the insurgents have little chance of capturing Kabul even after the withdrawal of international combat forces. At that point - and if no international security guarantee has been secured in the meantime to maintain peace in the capital – the Northern Alliance ex-warlords will likely revert to form and with the help of the ANA defend the city. Beyond the capital, it is unclear to what extent the leadership or rank and file of the Army will consider the war against the Taliban as „their war‟ after the US combat forces leave. The Army is not overtly politicized (unlike during the communist period). It is marked by ethnic divisions, with unprecedented representation of Tajiks and Hazaras in the officer corps. Strong minority representation, moreover, does not necessarily turn the ANA into a formidable adversary of the (primarily Pashtun) insurgents if one is to judge by the army‟s lacklustre performance even when fighting with international mentors or paired with foreign troops. This is not necessary a bad thing: it could open the way for a genuine de-escalation of the war as US-led troops withdraw. Reports are already emerging of pockets of co-existence at the local level as rivals agree to limit violence. In the presently embattled eastern province of Nangarhar, for instance, a plausible scenario for the transformation of the present war into a low-intensity, localized conflict can readily be constructed (see Sec II.A). On the national level, the possibility of an accommodation with the Taliban in the South, or even through a power-sharing formula on the national level, has opened wide schisms within the elite, as noted above. Some basic parameters of the present intra-elite bargain would probably need to change if the militants were to be included. One obvious concession to the Northern Alliance leaders would be to open for greater autonomy to the provinces relative to the central state. This has long been a demand of the political opposition of ex-warlords from the Northern Alliance leaders and political personalities with a power basis in the northern and western regions. A change of this kind need not require a constitutional amendment, which might be difficult unless done in the context of a comprehensive peace settlement. Alternatively, greater autonomy might develop through practice. This would involve renegotiations of tactic pacts between elites at the central and the provincial level. The most important tacit elite pact between the centre and the North is already being modified as result of pressures stemming from the changing political and security situation (see Sec. II.B on Balkh)

Center-periphery relations A changing economic scene may also stimulate de facto devolution of power to the provinces. Part of Kabul‟s power relative to the provinces has stemmed from its role in channelling large aid resources to the provinces, as well as wealth generated by the war-andaid economy that has sustained patronage politics. A reduced war-and-aid economy will set in motion a new dynamic in center-periphery relations where the allure of close ties to the centre will lose some of its lustre. At the same time, the centre will become increasingly dependent upon the collection of wealth from the provinces, particularly at the principal customs points, but also in the management of natural resources exploitation in the relevant provinces. While Western donors and the international financial institutions continue to emphasize the important of creating state capacity at the central level, particularly in key areas of public financial management and civil service reform, the emphatic commitment to statebuilding in the early years after Bonn has given way to scepticism, concern over corruption, a search for doable reforms, and a growing interest in starting from the other end 12

through „bottom-up-statebuilding‟. The cumulative result is a change in the balance of power in favour of the provinces. A de facto devolution of power could have positive ramifications for social order. It would reduce the stakes of gaining power in Kabul – in an extreme case, also reducing the incentives to fight over the capital as the armed factions did during the civil war. Lesser aid flows to the central state will also modify its rentier characteristics (barring sudden realization of rents from natural resources exploitation). In the long run, this is both necessary and desirable. The present level of aid is not sustainable. Rentier states, moreover, are typically corrupt and autocratic. High levels of aid is associated with high levels of corruption, and states that are not dependent on domestic sources of revenue need not be accountable to their people for how they governs or how the money is spent (Suhrke 2011). Reversing the process, however, is likely to be a bumpy and conflictual road. Over the past decade, rentier state elites have become entrenched. They have a capacity for „armed politics‟ in the competition over shrinking sources of wealth and power as well as the search for new ones. Initially, the leaner state may well simply be a meaner one, just as the reversal of autocratic rules towards more democratic accountability is associated with heightened conflict along the way. In the present Afghan case, much will depend upon the nature of the relationship between the center and provincial power brokers, the pacts they form or the conflicts they pursue.

The regional international context The external, regional context is a critical variable for the nature of the Transition and its aftermath, and some general points must be noted. Afghanistan‟s location in a conflictual region makes it potentially either a battleground or buffer (Harpviken 2010). In recent years, the former has been more common, as Afghanistan has become embroiled in regional conflicts (above all between India and Pakistan), but also among adversaries further apart (US vs the large powers in Asia, and US vs Iran). But internal and external conflict systems tend to be mutually reinforcing. Whether, or how, Afghanistan becomes ensnared in external rivalries also depends upon the level of internal unity or conflict among the Afghans. Four main scenarios for external-internal conflict interaction are readily apparent, schematically presented in Fig. I:

Internal conflict

Low

High

Unified buffer

Divided buffer

(internal and external peace)

(internal conflict external peace)

Low intensity conflict

Internationalized internal war

External conflict Low

High

(external rivalry but the center holds)

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A unified buffer is the best of all possible scenarios. A stable pacting between elites at the central and the local level is here reinforced by external recognition – tacit or in formal neutrality or non-intervention agreements – on the value of a buffer. This scenario is weakly represented in Afghan history. An internally divided buffer can remain a buffer if it is located in a „good neighbourhood‟ with low levels of conflict. External recognition of the value of a buffer and the costs of intervention will help to insulate internal strife from the international environment. Internal conflict in „bad neighbourhoods‟, however, constitutes a third scenario: Internationalized internal war. Rival factions tend to seek external support and can readily find it in a conflictual external environment. The result is competitive support to local clients and foreign intervention in one form or another, as Afghanistan experienced in the 1980s and 1990s. Low intensity conflict. Moderate rivalry among foreign powers need not tear the country apart as long as Afghans maintain a degree of internal unity among themselves. This holds even when foreign powers are locked in deep conflict and pursue competitive aid interventions. During the Cold War years, the US and the USSR competed for a foothold in respectively the southern and the northern part of the country, but the centre did hold – until internal Afghan conflict brought it down. We see shades of a similar pattern during the Great Game in the 19th century. The principal challenge during the present Transition is to steer both external and internal conflict towards the low ends of the scale. Some indications point in this direction. As noted above, Afghan elites and counter-elites may well redefine center-periphery relations as a way of adapting to a reduced Western presence and the stalemated war. If so, the southern and the northern crescent could emerge as more distinct regions, quite possibly with different ties to their respective neighbours. This need not, however, lead to a repeat of the 1990s provided (i) the neighbours and the US-led coalition restrain their rivalry over future influence in Afghanistan, and (ii) internal elite pacting holds. It may be noted that all Afghan parties to the conflict are committed to a unified Afghanistan as a sovereign entity. In this case, the situation would move from its present location in the lower right-hand corner of the matrix to the more localized and less intense conflict in the lower-left hand corner. To further explore this possibility, a closer look at provincial conflict dynamics is useful.

II: A VIEW FROM THE PROVINCES

The three provincial cases presented below illustrate different transitional dynamics. In Nangarhar, fragmentation of power and localized but low intensity conflict is on the horizon. In Balkh, the elite pact with the centre is being redefined. Kandahar lies at the center of the insurgency and the struggle for power in the wider region. 14

A: NANGARHAR

1. The province – main characteristics A small but populous eastern border province, Nangarhar is strategically located astride Afghanistan‟s principal eastern road to Pakistan –a conduit for trade, movement of people and military supplies. The good, all-weather road makes for a short ride from the provincial capital, Jalalabad, to Kabul and, in the other direction, Pakistan. Control over the area thus means access to rich economic, political and strategic resources. Not surprisingly, the opening salvo in the Afghan civil war after the withdrawal of Soviet combat troops in 1989 was the battle over Jalalabad. The province is also the home of the Tora Bora mountain range, the base of al-Qaeda during the Taliban regime and the site of major US- led operations to capture Osama bin Laden after the 2001 invasion. The operations gave an early power boost to local commanders who assisted the American forces. Access to material resources and influence associated with the international presence soon became a major asset in the local competition for power,. Jalalabad has since mid-decade been the hub of the eastern command of the Coalition forces (RC- East) and the center for US anti-terrorist operations in the eastern AfPak theatre, including the recent drone war. The military presence has generated a substantial local war – and aid economy, particularly towards the second half of the decade when US forces intensified their counter-insurgency and counter-terrorist campaigns. International aid was modest during the first half of the decade, but the widely lauded and mostly successful ban on poppy cultivation introduced by the governor in 2007-8 was rewarded with large inflows of US aid. US officials presented Nangarhar as a showcase of stability and development. A construction boom occurred as roads were paved, schools, health clinics, administrative offices and irrigation canals were built, and new townships sprang up alongside the Jalalabad road. US aid to the province in 2009 was estimated to 150 million dollars (Mukhopadhyay, 2012) . The US military presence was another source of funds through contracts for goods and services. During the second half of the decade, US commanders were dispensing millions of dollars locally in discretionary funding (CERP funds) to „win hearts and minds‟. In one famous case, a Shinwari sub-tribe received 1 million dollars in cash as incentive to keep out the Taliban (which was mainly used to fight a rival Sinwari sub-tribe). In the CERP-budget for 2010-2011, Nangarhar was allocated 82 million dollars. Only Kandahar had more (650 million), and Helmand came third (80 million) (PI, 2010). Funds of this magnitude will obviously impact on the political economy of a province with ca 1.3 million people, particularly when, as in this case, the funds are distributed strategically through a few local counterparts and sifted through a power structure they control. Aid agencies operating in the Nangarhar are advised to execute small projects as projects over 100 000 dollars probably will attract the attention of local power brokers demanding a cut, and projects over 500 000 dollars certainly will (Altai, 2010) . Other sources of wealth are less directly linked to the local war-and-aid economy. Trade – one of the traditional mainstays of the local economy, has flourished, encouraged by the relative security along the Jalalabad road, the local construction boom and the sharp rise in 15

demand for imports since 2001. Long-established local trading families of Afghan-Arab origin are among those who have benefitted and gained status as important power brokers in the province(TLO, 2011). The other traditional pillar of the local economy is poppy, which constituted an estimated 25 per cent of Afghanistan‟s total poppy crop in the 1990s. Cultivation remained significant until 2007 (UNODC, 2011). A third main source of wealth is smuggling. Trafficking is rampant, as might be expected in a border province with a permeable boundary and multiple cross-border social ties. As in much of the eastern region, social structures linked to tribal identity and institutions are strong in Nangarhar as compared to the rest of the country. Historically, some of the border tribes were granted autonomy by the king in return for their loyalty, and tribal structures remain an important source of social capital and political mobilization. In the western districts, a „tribal aristocracy‟ of large landowners emerged; the leading family (Arsala) has long been influential in provincial and national politics. Most of the population is Pashtun, although a few non-Pashtun communities have achieved significant economic and political power.

2. Power structure after 2001 The US invasion brought commanders of three local factions to the forefront of the local power structure. All the factions had formed during the jihad against the communists. One represented the influential Arsala family from the western districts, which had ruled the province during the mujahedin period during the early 1990s but had retreated to Pakistan when the Taliban seized power. In 2001, commanders from the family joined the invading US forces. One of them was the famous Abdul Haq (who was killed early on), another was his nephew Haji Zahir, who assisted the Americans in the Tora Bora campaign. US forces also worked with two other commanders with less traditional status in their luggage. Hazrat Ali hailed from a minor non-Pashtun tribe in a northern district of the province. Haji Zaman belonged to a major provincial tribe (Khogiani), but the community was internally divided by blood feuds and concentrated in the poorer southern districts that depended on poppy for winter crops. Bundles of US dollars handed out by US forces to the three commanders for providing men to chase the fleeing Taliban and al-Qaeda empowered all three factions, but also created greater equality and fanned the rivalry among them. The three factions had initially agreed on a local power sharing formula when the Taliban withdrew, dividing among them the post of governor (the Arsala family), police chief (Hazrat Ali) and army leader (Haji Zaman). The settlement was unstable, however, and made worse as the factions competed to exploit the US force presence. To cut it short, President Karzai in 2005 appointed a new governor from the outside, Gul Aga Sherzai. The new governor created a measure of order and stability based on skillful management of patronage politics, made possible in large part by his ability to access the local war-and-aid economy.

The rise of a provincial strongman Sherzai did not start from zero, but from a power base arising from a distinctly primitive accumulation of capital in his native Kandahar province (see sec. C). Adroitly exploiting his

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close relationship with US force in Kandahar after 2001, Sherzai amassed a fortune – perhaps in the order of 300 million dollars - by the time he became governor in Nangarhar. Sherzai‟s wealth enabled him to finance a system of patronage politics that made him the principal Afghan arbiter of power in the province (Mukhopadhyay 2011). He effectively bought support from elders and malik (whom he invited to join special shura he set up). He divided local power rivals by dividing them as he courted some. Hazrat Ali who belonged to a minor, non-Pashtun tribe was particularly open to a deal and long remained chief of police. Sherzai also used patronage and political skills to announce a ban on poppy cultivation. Although the ban rested on a fragile foundation – Sherzai financed brokers to enforce it rather than introducing reforms to lessen long-term dependence on the crop - the sharp decline in cultivation after 2007 enhanced his status with the US. As aid and contracts increased, so did Sherzai‟s cash flow. Contracts were steered towards companies that he or his relatives controlled, particularly in the construction business. As the principal interlocutor of the US Provincial Reconstruction Team, the governor could channel aid projects in particular directions, which again was a source of rewards. Closeness to his powerful US patron also generated symbolic power; the „power of inference‟ that the governor could influence aid allocation and even decisions of US forces, such as release of detainees (Mansfield, 2010). Sherzai‟s status as US client was dramatically enhanced in 2008 when presidential candidate Barack Obama visited him in Nangarhar before paying his respects to the central government in Kabul. When Sherzai the following year considered running for president he also received demonstrative US support. Other sources of material and symbolic power were independent of the US presence. There was the Governor‟s Reconstruction Fund, a special tax levied on traders. Widely recognized as an instrument of patrimonial governance and graft, the fund was at one point declared illegal by President Karzai, but the governor merely redirected the revenue to „The Sherzai Foundation‟. The trade tax generated tens of millions of dollars worth of personal income annually for Sherzai.4 Appointments in the provincial administration were another source of enrichment. Formally made by the central government, appointments were in practice controlled by the governor. Sherzai was also a skilled politician in his own right in relation to both his subjects and the central government. Considerable customs revenue was passed on to Kabul, enough to make Jalalabad the second-highest source of import duty in the central government‟s statistics for the period 2005-2009.5In general, the relationship to Kabul was personalized (Sherzai is related to Karzai through marriage), but difficult. In relation to his subjects, Sherzai took on the role of a „neo-khan‟, Dipali Mukhopadhyay writes, who may rule autocratically but provides for the public good by creating parks, building monuments and renovating palaces , argues (Mukhopadhyay 2011). And with the insurgents he had apparently struck deals that enabled him to move relatively freely around in the province and preside over visible results of reconstruction, year after year.

4

Dipali Mukhopadhyay, estimates at least $35 million annually. Based on Afghan Customs Department, cited by Middelbrook 2011. For this period (2005-09), import duties collected in Jalalabad represented just over one-fourth of the national total. 5

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Other power brokers on the provincial scene A decade after the US invasion, a striking feature of the provincial power structure is the presence of ex-commanders in formal and informal positions of power. The three rival factions from 2001 are still intact, two of them with the same leadership.6 A local survey in 2010 showed residents identified 14 other persons as powerful actors in the province; of these, 10 were ex-commanders (TLO 2011). Most had expanded into politics and business, typically through political appointment (or self-appointment), and – in recognition of the interaction between politics and economics - concurrently running a business as well. A few prominent trading families were identified as traders only, and a few commanders were identified as only commanders. Parliamentary representation was more diversified. Excommanders constituted less than one-third of the cast from Nangarhar in the 2005 Wolesi Jirga, the rest were professionals, government officials or members of politically active families. The most powerful local actors have diversified. Hazrat Ali, the minority commander who rose to prominence in the Tora Bora campaign, was reportedly active in the informal cross border trade, reports that gained popular credence from his many years as provincial police chief. In 2005, he further diversified by entering national politics, winning a seat in the Wolesi Jirga. The other main commander of the original trio has undergone a similar transformation. Haji Zahir , a second-generation commander in the influential Arsala family, whose father and uncles were prominent in the jihad and close to Karzai, was given a position in the Border Patrol Police. His career in the BPP dead-ended in 2007 when his official car was impounded with a supply of heroin and Haji Zahir was sentenced to a long prison term for drug smuggling. Pardoned by President Karzai in 2009 (when his uncle was managing Karzai‟s re-election campaign), Haji Zahir returned to Kandahar and launched a new career. His relatives had already used the formal democratic institutions introduced after 2001 to capture the elected provincial council and used this forum to oppose Sherzai. Haji Zahir set his sights on the national scene, established a local political party (called the „Peace Caravan‟), and won a seat in the Parliament in 2010 (but was disqualified the following year). By 2011, the elite structure in Nangarhar was bifurcated, and the order established around the governor appeared uncertain. Being closely tied to an external patron, Sherzai‟s position was weakened by the expected exit of US combat forces. Sherzai himself had the previous year requested reappointment to his native Kandahar. Sensing the change, rivals with a local power base were gathering strength. In March, a group of provincial councilors and members of Parliament from Nangarhar openly called for his resignation.

The insurgents The main parts of Nangarhar were relatively secure until 2010 when insurgent activity increased, evidently as a result of the US military „surge‟ that put more pressure on armed groups in the southern districts. Fighting increased as insurgents moved towards the central area, where US forces went on the offensive as well. At the same time, escalating violence on the Pakistan side of the border led some militants to seek sanctuary in Nangarhar. One group staged a dramatic suicide attack on the Jalalabad Bank in early 2011. Meanwhile, the 6

Haji Zaman was killed in 2010.

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Pakistan military started shelling areas on the Afghan side of border, possibly to make a political point in advance of possible US-Taliban negotiations. What all this amounts to is unclear, except that the insurgents active in the province do not constitute a coherent movement and hence do not have a unified strategy. The groups fall into two broad categories: „outsiders‟ and „insiders‟. The outsiders are distinct in that they have few if any local roots. That includes the „old Taliban‟. The Taliban governor for Nangarhar in 1996 came from Kandahar and the military coordinator came from Paktia. Unlike some other eastern areas, local mujahedin factions were not included in the Taliban government in the province (TLO 2011). Even more starkly outsiders are the Pakistan-based armed opposition groups (notably Lashkar-e-Taiba) and remnants of al- Qaeda „foreign fighters‟ outsiders. 7 Other militant groups are „insiders‟ in the sense that they represent a continuation of older Islamist factions that had strong following in the province during the war against the communists and in the interrum before the Taliban took power in 1996. These „insider militants‟ include a new group organized around the son of a major mujahedin leader previously based in Nangarhar, Yunis Khales, and was supported by major local power brokers, including members of the Arsala family. The group of Khales‟ son now operates in Nangarhar under the name of the Tora Bora Military Front. The Hezb-e-Islami /Gulbuddin Hekmatyar(HIG) was also a powerful in the province during the jihad time and still has a presence in several districts. The movement also has a foot in the national and provincial political arena in the form of a „reconciled wing‟ that formally claims it is separate from the original movement. The „insider militants‟ operate in a familiar terrain, socially as well as politically. Several members in the present provincial administration and other power brokers belonged in an earlier period to precisely the mujahedin groups from which the present „insider militants‟ originate.

3. The future A draw-down of the US forces in Nangarhar is not likely to leave a residual presence for counter-terrorist purposes, but will still have consequences through its political signal effect and the expected shrinking of the war-and-aid economy. The most likely immediate impact on the local power structure will be an intensified competition for power among local power brokers - barring Sherzai. The power he has husbanded and the system built on patronage as governor is hardly sustainable in a provincial context without his external patron. There are other arenas, however, where the wealth, political skills and ambitions of a man like Sherzai can be applied, either in his native Kandahar or on a national scale , and Sherzai has himself suggested he is ready to leave the eastern province (Forsberg, 2010, (Khalil, 2011). The remaining actors are likely to enter a complex and protracted struggle to define the terms of a new elite settlement, just as they did in the early period after 2001. All have access to 7

US military sources claim to have detected Pakistani or al-Qaeda militants in about half of Nangarhar’s districts LWJ (2011) Long War Journal, http://www.longwarjournal.org/archives/2011/02/taliban_suicide_assa_3.php#ixzz1TGevKZrj. .

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arms, men and funds independent of the US presence. Even if the war-and-aid economy shrinks considerably, there are important local resources to finance the contest – above all poppy production, smuggling, taxation and „protection‟ of trade (including illegally harvested timber from Kunar), and accumulated wealth. All the main factions have demonstrated their ability in the past to access these resources, and can be expected to do so again.8 Even in the absence of major external patrons, and assuming only a modest aid economy that can be „taxed‟, this would be sufficient to sustain a local conflict of some seriousness. Yet the conflict need not be very violent. Accessing positions in the provincial administration is the first critical step to power, which may continue to follow formal procedures (appointments by the central government or elections), although against a backdrop of „armed politics‟ (threats, kidnappings, targeted assassination). Permitting the illegal economy to flourish in the districts may be a de facto form of power sharing among rival factions. In the past, armed clashes on some scale (apart from the insurgency) have been sparked by longstanding disputes over land and water rather than control over the illegal economy. Perhaps, as one study suggested, in good years there was enough poppy to go around, and conflict subsided (Zuercher and Koehler, 2007) . There are more subtle constraints on violent conflict. Pashtun culture has traditionally placed limits on war among fellow tribes that reflect the logic of belonging to a wider community, as well as the self-preservation of individual clans and protection of the agricultural cycle (Roy, 1986) (Suhrke, 1990). How much of this ethos has survived the past three decades of war and social upheaval is unclear. But the logic of protecting common sources of wealth, such as the trade along the Jalalabad road, reinforces a „limited war‟ perspective. Rival factions may for a time fight for control over the lucrative trade, but the rising costs in terms of disrupted trade will diminish rents to a point where a hierarchy in „protection‟, or a clear winner, is likely to emerge. The rationality inherent in this dynamic has historically speaking operated to provide social order in diverse settings; in Afghanistan, it is a principal explanation for the rise of Taliban to power in southern Afghanistan in the early 1990s. In relation to the insurgency, the departure of American combat forces will deprive the militants of a principal ideological reason for fighting, and may create room for the „insider militants‟ to enter the process of defining a new elite settlement that can be expected to occur during the Transition. Past ties among some of the „insider militants‟ and present power brokers suggest the possibility of a more inclusive settlement that takes in some of the present counter-elites. On their own, the „outsider militants‟ will then be marginalized. Given the divisions among the militants, this mixed-membership scenario is more probable than its opposite – a new elite as the insurgents sweep to power following US force withdrawal.

Conclusions The best case scenario for Nanrgar during the Transition and a medium-term outlook also a quite probable one: a low intensity conflict (LIC), locally financed, and with a prospect of including significant segments of the insurgents. From a social order perspective, this would not be worse, and probably an improvement over recent years. The stability and 8

Haji Zahir, it will be recalled, was jailed for drug smuggling. His uncle was provincial governor during the mujahedin period in the early 1990s; Nangarhar then produced about a quarter of the nation’s poppy. Hazrat Ali reportedly is linked to smuggling operations, and the faction of the late Haji Zaman is concentrated in the province’s premier poppy cultivation district.

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reconstruction in the Sherzai period notwithstanding, the war has meant considerable violence for several communities, including those affected by some infamous cases of „collateral damage‟ inflicted by the Coalition forces.9 From the perspective of statebuilding and revenue collection the outlook is ambivalent: less revenue will reach the central government if local rivals appropriate locally collected revenue to sustain their contest, but an unstable balance among them would strengthen the central government‟s hand in claiming revenue in return for support. The ban on poppy cultivation is likely to wither fast, given the particular combination of international pressure and a cooperative as well as effective governor that made it possible in the first place. At the same, time, poppy will become more attractive as a source of income as the war-and-aid economy shrinks. The growth of an illegal economy that inter alia finances local conflict clearly has problematic aspects, but there is also a counter-intuitive aspect of some importance. Local contestants that can tap local resources to finance their rivalry are less inclined to seek out external parties for support. Attempts by the Afghan government or the international community to restrict these sources of finance might well encourage the local rivals to seek external support, particularly in the region, and thus invite a competitive intervention of the kind that historically has intensified violence in the border area. Chances are that the conflict then would no longer be localized, limited and low intensity.

B: BALKH

The political economy of Balkh – a generally prosperous northern province astride the main trading route to Central Asia - is much less tied to the Coalition military presence and the war-and-aid economy than the eastern and southern provinces. The provincial capital Mazari-Sherif is still the economic, political, religious and intellectual hub of the North. The Transition is therefore likely to have few immediate direct effects in the province, although indirect effects will be felt in the areas of center-province relations, ethnic relations and the state of the insurgency.

1. The province – main characteristics Until the US military „surge‟ in 2010, the international force presence in Balkh was relatively light, a fact that reflected the virtual absence of the insurgency in the northern region until the latter part of the decade. The Coalition forces deployed to Balkh in 2004 was initially led by a small British Provincial Reconstruction Team, later taken over the by Swedes. Both were light deployments with a stabilization rather than combat mission. The headquarters for 9

In 2007, US marines responding to an attack on the Jalalabad road by shooting indiscriminately into backedup traffic, killing 37 civilians. The following year a bridal party in thea southern Deh Bala was bombed by a US plane, killing an estimated on a 47 persons, including the bride.

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ISAF‟s Regional Command North and its Quick Reaction Force, designed to assist ISAF forces elsewhere in the command region, are located in Mazar, but this deployment has entailed limited interaction with the local population, economy and polity. Officials in Balk commonly complain that the relative stability of the province has made it a neglected area in terms of economic assistance as aid actors have favoured insurgent-troubled provinces in the South and the east. For aid dispensed by USAID and US military forces – two major sources of direct money flows – this is correct. USAID estimates its aid allocations to Balkh in the period 2002-08 was slightly less than half of the allocations to Nangarhar,10 and US force presence was limited. It is indicative that even with „the surge‟ , Balkh was given a CERP budget of only $8 million for 2010-11 (PI 2010).In other respects the picture is more complex. Government estimates that in terms of of cumulative ODA distributions, the Northern region as a whole has received about the same, if not more, than other regions apart from the Central zone (and excluding nation-wide programs) (GoA, 2009) .Figures per province are not available. Balkh‟s wealth derives principally from other sources. In 2008-9, locally collected customs duties passed on to the central government were the equivalent of $52 million, making Balkh the country‟s third richest customs point after Herat and Jalalabad (Goodhand and Mansfield, 2010).. As members of the Northern Alliance and hence partners of the United States, the excommanders owed the foundation of their new-won positions to the invasion. But as the fighting in the North soon ended and the Coalition forces focused on the southeast, their accumulation of power in subsequent years primarily reflects their ability to exploit local sources of wealth and manage the relationship with the central government, and only secondarily their dependence on the international presence. By 2011, this new class of powerbrokers and its pre-eminent leader, Governor Atta Mohammad Noor, had turned the provincial capital into a place of visible economic growth, with bustling trade, public and private construction and large, new housing estates. The activity reflected four main factors: the relatively stability and predictability brought by Atta since 2004; the ability of the new elite to exploit the city‟s historic location and the new raillink to the border crossing; investments from rents derived from the city‟s central role in the opium economy of the North; and the strategic overlapping of economic and political power that permitted the commanders-turned-businessmen and their associates to accumulate significant capital (Pain 2011:25-26). At least some capital was re-invested locally, although the older industrial infrastructure was left to rust At the same time, the relative stagnation of the agricultural sector and the decline of traditional landholding khan strengthened the role of the new elite as power brokers in the province as a whole.

2. Power structure The ethnic map of Balkh is deeply fractured. Tajiks and Uzbeks constitute together well over half of the population, with Hazaras, Turkmen, Pashtuns and even smaller groups making up the rest . This diversity forms the backdrop for the provincial power structure and suggests a measure of fragility in the social order that has developed under Atta. During the war against the communists, commanders associated with four major political parties operated in the 10

$104. 6 million as against 221.6 million, according to Mukhopadhyay (2011:56).

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province, the (mostly Tajik) Jamiat, the (exclusively Uzbek) Junbesh, the (exclusively Hazara) Wahdat, and the (exclusively Pashtun) Hezb-i-Islami. During the early years after the invasion, leading commanders of the first three factions were locked in a deep rivalry. Atta (Tajik/Jamiat) emerged and has since consolidated his power. All the other parties remain active in Balkh, however, and the leaders of Junbesh and Wahdat (Dostum and Mohaqiq) are major players on both the regional and national scene.

The rise of a provincial strongman After being appointed governor by president Karzai in 2004, Atta developed a ruling system that rested on local loyalties, extraction of rents from the local economy, and strategic allocation of positions in the provincial and district administration (Mukhopadhyay 2011). A carefully cultivated relationship with the central government acted as a balancer (to neutralize local rivals) and multiplier of power (to increase Atta‟s political and economic capital). Perhaps Atta‟s greatest initial advantage was the fact that he is a „native son‟ of Balkh who rose during the wars in the 1980s and the 1990s to become a majort commander with a large personal following. His status as a powerful commander in the Jamiat party was subtly transformed in the rivalry with the Uzbek commander Abdul Rashhid Dostum in the early years after 2001 over control of Mazar. Atta successfully outmanoeuvred Dostum by positioning himself as the more effective and reliable northern partner in the internationally assisted statebuilding project. International pressure and mediation in Kabul sidelined Dostum to rule in neighboring Jowzan province, while Atta was appointed governor of Balkh. In Balkh, Atta initially consolidated his power by installing his sub-commanders in key positions in the provincial security system (police and intelligence) as well as in the administration on the district and provincial level. His sub-commanders were also given preferential access to land and business transactions when facing demobilization through the UN-supported DDR program. The result was a loyal, informal system of support-and-control which laid the foundation for Atta‟s exercise of power. Atta himself successfully changed his image from a commander to that of a reformist civil servant, shaving his beard and donning smart suits while speaking the language of aid, growth and civil service reform appropriate to the post-2001 order. He also transitioned into a successful entrepreneur, creating a far-flung set of enterprises in real estate, construction and trade where his close relatives (including his brothers) held executive positions. In addition he apparently profited greatly from the opium economy during the early years when he was consolidating his power (Pain 2011, Goodhand and Mansfield, 2010). Traditionally limited, poppy cultivation in Balkh increased to represent about 10 per cent of the national production in 2005. Local power brokers were known to be involved in the protection and „taxing‟ of the opium economy, and Atta‟s men were strategically placed throughout the province. A formal attempt by Kabul and the international community to investigate and control the practice in 2004 was decisively rebuffed. When Atta in 2006 declared a ban on poppy cultivation, its initial implementation was attributed to the enforcement capacity of Atta‟s system of governance as well as the probability that his men were centrally placed in the opium economy. In consolidating his power, Atta also built close relations with a small group of entrepreneurs, publicly symbolized by sponsorship from local businesses of showy, new traffic roundabouts 23

constructed in the city. In more substantive terms, the partnership flourished in the enabling environment for quick growth, windfall profits and extraction of rents that Atta promoted. Near-monopoly control of key trading commodities (fuel, fertilizer) was widely reported; bidding on contracts was restricted by intimidation or unequal access to the allocating authorities, and land-grabbing and land-speculation occurred in thinly disguised illegal forms. The new order in Balkh has meant investment in public goods like parks and roads that has earned Atta a measure of public support, although „focus groups‟ in the countryside invariably complain of a corrupt and predatory government and little assistance (Fishstein, 2010). More important in terms of long-term stability, Atta has sought to manage ethnic tension in the province by steering a number of appointments in the provincial and district administration towards members of other ethnic groups than his own. Uzbeks, Hazaras and Pashtuns have all been placed in positions throughout the administration, including important ones. Like many of his fellow ex-commanders elsewhere in Afghanistan, Atta has also utilized elected and formally democratic institutions with considerable skill. His followers dominate the elected provincial council, although only some of them are formally identified with the Jamiat party ticket. Atta‟s relationship to the central government is a complex web of mutually supportive functions. Until 2009, it amounted to a tacit elite pact between the centre and the province, framed around the agenda of the internationally supported statebuilding project.11 Atta basically continued the strategy that had helped marginalize his regional rivals after the invasion. He aligned with Karzai and the Pashtun commitment to a unitary state by eschewing the federal rhetoric of other northern leaders during the Constitutional debate in 2003, and he supported Karzai during the 2004 presidential election. As governor, he served the statebuilding project in administrative matters (e.g.by early commitment to civil service reform and a provincial development plan) and on key policy issues (by introducing a ban on poppy cultivation in 2006). Although not all revenue collected in Balkh is necessarily passed on to the centre, enough is turned over to the Ministry of Finance to make Mazar the third largest collector of customs duties in official government statistics, as noted above. In return, Atta received formal powers (as the central government‟s appointeee), a free hand to rule the province (particularly in matters of appointments, even though this is formally within the purview of the national administration), additional civil service positions, easy access and favours on particular issues of concern in Kabul (e.g. a grant of public land near Mazar that enabled Atta to allocate residential plots to his followers in a way that laid the basis for his profitable real estate business while cementing ties with his supporters). In addition, and importantly, he received favourable attention in the international community as a man one „could do business with‟ (Pain 2011:5). The pact soured in 2009 when Atta supported the opposition candidate associated with the non-Pashtun minorities in the presidential election, Dr. Abdullah, which introduced a new element of uncertainty for the future. The deteriorating relationship with the center – one of the pillars in Atta‟s system of power –raised questions about the continued viability of the „elite pact‟ that until then had contributed to provincial stability and reduced ethnic tensions.

3. The future

11

The discussion of elite pacting here and in the next section is informed by the broader analysis of centerprovince relations and peacebuilding in Goodhand and Mansfield(2010).

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The political outlook in Balkh for the medium-term future depends on developments in three main areas, all of which are indirectly affected by the withdrawal of international combat forces envisaged during the Transition. The center-province relationship that has sustained stability in Balkh and Atta‟s rule was badly strained by Attas „defection‟ from Karzai in the 2009 elections. Ethnic tensions rose as the governor openly accused the centre (more specifically the then Interior minister Haneef Atmar) of distributing arms to local Pashtun power brokers in Balkh (more specifically through an ex-Hezb-i Islami (Pashtun) commander from Balkh, Juma Khan Hamdard, who at the time served as governor in Paktika).The purpose could have been to undermine Atta‟s reputation as the architect of stability in Balkh, thereby facilitating his removal and paving the way for Pashtuns to gain power in the heart of the northern region, as many non-Pashtun in the area believed (Mukhopadhyay 2011, (Giustozzi and Reuter, 2011). In response, or as a general preparation for the elections, it was rumoured that Atta and other ethnic leaders were arming their militias as well. Whichever the case, local violence increased, particularly in 2010 year when parliamentary elections drew near and militias of sundry local commanders appeared on the scene. Atta and the new elite that have prospered under his rule have an obvious interest in restoring the pact, but his will or ability to do this depends in part on what happens at the centre. There is much suspicion in the North and among those who constituted the Northern Alliance that Karzai is preparing to negotiate with the Taliban, having lost faith in the will of the West to support him and recognizing that international forces will be withdrawn. The prospect has already infused the national discourse with heightened ethnic tension, as discussed above (sec. 2). In this context, it is plausible that Karzai will reach out to ethnic Pashtuns in the North in order to strengthen his political base. The mere suspicion that he will, or is, playing „the ethnic card‟ is likely to have a reciprocal effect in the North, which probably explains why Atta defected from the pact with Karzai and endorsed his sworn enemy, Abdullah. An escalation of suspicion and mutually antagonistic moves could well endanger the pact. The disintegration of a pact that has framed a stable and cooperative relationship between the hub of the North and the central government would raise questions about future stability both in Balkh and beyond. It could revive traditional northern rivalries. For example, Atta‟s two arch rivals in the North, Dostum and Mohaqiq, recently launched a national opposition front to Karzai in cooperation with a prominent Tajik leader (Zia Massoud), but with Atta and Dr. Abdullah conspicuously absent. Divided in a complicated and shifting balance of power, each of the northern leaders would want a „balancer and a multiplier‟ to gain an edge on the other(s). With an increasingly contested central government, uncertainties about the future, and the advancing pace of the insurgency in the northern region as a whole (see below), the incentive to seek support from external patrons is obvious. This could invite competitive external intervention by regional powers, a situation that in the past has intensified local rivalries. Alternatively, the disintegration of the pact might forge a stronger alignment among all the northern leaders to face the centre and, beyond it, the Taliban, thus recreating the conditions for a civil war along North-South and Pashtun-non Pashtun lines. Ethnic relations. More immediately, an antagonistic relationship between Atta and the centre that is cast in ethnic terms – as it now is – could ignite the tinderbox of ethnic relations in Balkh. The province has a history of organized, and at times massive, ethnic violence where individuals are targeted by virtue of their ethnic identity. All ethnic groups suffered in the 1990s, most recently the pogroms against ethnic Pashtuns after 2001 in retaliation for massacres perpetrated by Taliban when they took Mazar in 1998, which was to revenge 25

massive killings of Taliban during an earlier and failed attmept to take the city (Human Rights Watch, 2002). The insurgency. As Pashtun-based movements, the Taliban were initially weak in the North after 2001, and did not make serious inroads until 2008. Recent advances are partly based on alliances with non-Pashtun ethnic groups, and recruitment based on ideology rather than ethnic nationalism (Giustozzi and Reuter 2011, (Ruttig, 2010). Balkh, however, remained by 2011 relatively unaffected compared to the other northern provinces. On a national scale of violence initiated by armed opposition groups the province still ranked towards the peaceful end (ANSO, 2011).12 The reasons are unclear, but appear to some degree to reflect the system of governance developed under Atta. The future of the insurgency in the northern region as a whole is uncertain. Here as in the South, the intensified US intensified „kill-or-capature‟ strategy in 2010 has eliminated a large swath of „old‟ middle-level commanders and in the short run may have dampend the activities of the movment. But it has also made room for a newer and apparently more radicalized leadership that in the slightly longer run could reinvigorate the insurgency and engulf Balkh as well.

4. Conclusions: The most likely scenario for the Transition period and the medium-term future can be termed fragile stability. The provincial power structure that developed after 2001, especially after rivalries among regional strongmen were settled in favour of Atta, has produced a measure of stability and development for reasons that are not primarily connected to the international military and economic presence. Yet it has weak points, above all the future uncertainty of the intra-elite pact between the centre and the province. Until recently a pillar of the local power structure and the associated stability, the disintegration of this pact could ignite ethnic violence within the province, generate new rivalries among regional strongmen, and harden the North-South divide within the country as a whole.

C: KANDAHAR As the birthplace of modern Afghanistan and the Taliban movement, Kandahar is considered the cultural and political heartland of Afghanistan. Whether it will hold or fall into insurgent hands will have broader national and regional repercussions. Kandahar is significant not only in its own right as a key economic hub; it is also the main political and economic centre of Southern Afghanistan. The country‟s second largest province, its population varies with the ebb and the flow of the fighting and is estimated between one and two million. The leftist coup of 1978 and the ensuing war of resistance by the mujahidin not only changed the social and economic dynamics of Kandahar itself; it also altered its historic relations with Kabul. With the demise of the old Durrani regime in 1978 „‟the traditional Durrani aristocracy saw its influence evaporate‟‟(Forsberg, 2010:14-15). During the ensuing three12

In first quarter of 2010, there were 14 attacks (with 381 in Helmand and 76 in Kandahar). In the first quarter of 2011, the figure had increased to 31 (as compared to 672 in Helmand and 128 in Kandahar (ANSO 2011).

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decade-long war the influence of the „‟super-tribal elite, which drew its strength more from state power than from having broad tribal authority‟‟ was replaced by an emerging class of „new Khans‟- commanders and warlords representing a new generation of ruling elites (ibid:12). The rising power of the Karzais in Kandahar and the wider southern region is generally viewed as attempts to reinstate the „super-tribal elite‟- mostly Popalzai and Barakzai Durranis - that had held power in Kandahar since the mid-eighteenth century. Their patrimonial method of ruling closely resembles that of the old monarchical regime under Zahir Shah (1933-1973). At the same time the „new‟ power brokers in the South like Abdul Raziq (Kandahar Chief of Police and Chief of the Border Police) and Matiullah Khan (Uruzgan Chief of Police) closely resemble their predecessors in the mujahidin movements of the early 1990s. Their main source of power and wealth is closely linked to the political economy of conflict. Their ability to organise and exert violence in support of their political and economic agendas and the ruthless way they go about this is a reminder of the Afghanistan that once was before the Taliban swept to power in 1994. The province – main characteristics In the post-2001 political order, the Popalzai clan of Hamid Karzai and the Barakzai clan of Sherzai, and, to a lesser extent the Noorzais and Achakzais, have constituted a near monopoly on powerful political positions and much of the economic activity, licit and illicit, in Kandahar and the wider region thanks to their political, military and commercial alliances with US and ISAF/NATO forces (Chayes, 2006; (Giustozzi and Ullah, 2007), Forsberg, 2010). Returning to Kandahar with US forces in 2001, Sherzai was appointed governor. In his new position of power, Sherzai ruthlessly embarked upon consolidating power and accumulating wealth, mostly by marginalising and persecuting rivals. He skilfully exploited his access to US military and ISAF/NATO contracts, often sidelining rival power brokers, possibly driving some of them into the arms of the Taliban. In 2005, Karzai removed Sherzai to serve as governor in Nangarhar in order to strengthen his own clan‟s influence in Kandahar. Until he was killed in July 2011, Ahmed Wali Karzai was the kingpin in this new power structure. Ahmad Wali had been credited by many observers, Afghan and foreign alike, for keeping a lid on simmering tensions and standing in the way of the Taliban. His death, as well as the imminent departure of Western troops and the growing level of violence and uncertainty about the future, are reinforcing views about the potential role of strongmen in improving security and containing the insurgency. The appointments of strongmen like Gen. Abdul Raziq and Matiullah Khan as Chief of Police in Kandahar and Uruzgan respectively are a strong indication of this kind of thinking. The Spin Boldak border crossing is the region‟s main trading port where in 2009 NATO planned to build a $20 million customs depot (Graff, 2010). In the second half of the decade, Gen. Abdul Raziq had emerged as the undisputed „master‟ of Spin Boldak (Aikins, 2009). His profits from kickbacks from the border trade are reportedly formidable. Kandahar generates about $40 million per year in customs revenue for the central government, an unknown but reportedly small fraction of what it should collect. Spin Boldak is also the key

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route through which the drugs and other illicit trade in weapons, currency and people is organised.13 Opium cultivation in Kandahar and Helmand accounted for 82% of national cultivation, and is a major pillar of the local economy (UNODC, 2010). The main opium smuggling routes pass through Kandahar and connect Helmand, Nizmruz and Farah to Pakistan and Iran. In 2010, opium cultivation in Kandahar representing 21% of national cultivation rose by 30%, despite a 48% decrease in national production in 2010 (ibid). The vast majority of international forces are stationed in the south, mainly at Kandahar airport. Kandahar is also home to the Coalition‟s Regional Command-South (RC-S). The presence of these forces and the billions of dollars spent on their upkeep is a major source of patronage for Kandahar‟s power brokers. Sherzai and his family continue to operate their military and commercial empire from inside the airport. Ahmad Wali and other family members have earned windfall profits from foreign military contracts, enabling them to exert control over a variety of local militias and dominate Kandahar‟s political and economic life. Both Sherzai and Ahmad Wali have rented local militias and large tracts of real estate to US/NATO forces (Aikins, 2010); Forsberg, 2010). The southern focus of the Coalition campaign has meant huge inflows of military and economic assistance. For instance, USAID allocated $143.8 million to Kandahar in 2009-10; the following year the military CERP budget for Kandahar was about $656 million (CFR, 2011) (PI, 2010). For the coming year (fiscal 2011-12), the US military is poised to spend a staggering $113 billion on its Afghan engagement (CRS, 2011). A recent US Senate report concludes that „‟Afghanistan could suffer a severe economic depression when foreign troops leave in 2014‟‟ (CFR, 2011). If so, the present elites in Kandahar and its southern dependencies are likely to be hit hard by the impact. The rise and fall of Kandahar‟s strongmen As an established modus operandi, leadership among Pashtuns has been acquired by a pretender‟s ability to extract wealth, either through plunder or tribute or subsidy and distribute it among his followers (Chayes, 2006:85&101). Hamid Karzai‟s ability to extract resources from the outside world was a key motivating factors in his popularity among Afghans. Ahmad Wali Karzai‟s power and influence was largely attributed to his ability to play the role of broker between Kandahar‟s men of violence and ambition and the Western military forces; to extract vast amount of resources and re-distribute them to his allies in exchange for loyalty. That is what held the „elite pact‟ together. Until his death in July this year, Ahmad Wali Karzai had consolidated a powerful empire by merging tribal politics, dominance over government and state institutions in Kabul and Kandahar, links to CIA and U.S. Special Forces, and his monopoly over militias and economic activities associated with government and ISAF/NATO contracting. The killing of Ahmad Wali Karzai was a serious blow to president Karzai‟s influence and power in southern Afghanistan. Soon thereafter other key allies of the President in the South were killed as well, whether in a concerted attack or more coincidentally. Jan Mohammad For a detailed account of Abdul Raziq’s drug running operations, control of smuggling activities in Spin Boldak and connection to U.S. Special Forces, see Aikins (2009). 13

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Khan, the former governor and strongmen of Uruzgan and a long time mentor and ally of the Afghan president, was killed a few days later. Then a suicide bomber killed Ghulam Haider Hameedi, the mayor of Kandahar, and the following days the insurgents attacked the compound of Jan Mohammad Khan‟s nephew, the notorious militia commander Matiullah Khan. The spate of attacks appeared to be attempts to reconfigure, through violence and targeted assassinations, the politics and power in Kandahar and the wider region in anticipation of Western withdrawal. It casts doubt on the strategy of relying on Afghanistan‟s strongmen to battle the insurgency and improve security when so many of them are being assassinated in a campaign closely mirroring ISAF/NATO‟s own „kill/capture‟ policy aimed at Taliban field commanders. Meanwhile, the deaths of Ahmad Wali and Jan Mohammad Khan have left President Karzai with a power vacuum in the South at a sensitive time when security responsibilities are being transitioned from foreign forces to the Afghan government, and reconciliation with the Taliban is gathering momentum. Their removal from the scene will also complicate preparations for the next round of elections in 2014, although President Karzai has announced that he will not run for a third term. Ahmad Wali was instrumental in President Karzai and his allies‟ gains in the 2009 presidential and 2010 parliamentary elections. Unlike other areas of the country that experienced a degree of relative peace in the early years after 2001, Kandahar has remained in the grip of violence throughout. The recent assassinations have further demoralized the population: „‟If Ahmad Wali could not protect himself, if Jan Mohamed Khan could not protect himself, who will protect those in villages that are supporting the government?‟‟ (Mashal, 2011). The future of Kandahar‟s governor, Toryalai Wesa is questioned as well. With so much uncertainty, Afghans are reverting to the past to find meaning and answers to their current dilemmas, fearing the past will repeat itself. Most Afghans seem to be bracing themselves yet again for more fighting, flight, dislocation and loss of life and property. For the foreseeable future, armed politics and competition among existing elites will intensify, and so will the insurgency. With Ahmad Wali‟s death “a vacuum has opened in Kandahar as … rivals and allies scramble for advantage‟‟ (Aikins, 2011).

The Insurgency The bulk of Taliban insurgency hails from Kandahar. The Taliban resurgence was not inevitable. When the US invaded, senior Taliban figures in Kandahar decided to reach a settlement with the new regime. The Afghan government and its Western sponsors, however, rebuffed their initial overtures, primarily because they considered the Taliban a spent force (Strick van Linschoten and Kuehn, 2011; Gopal, 2010). What spurred the Taliban to take up arms again was a targeted campaign of persecution and harassment by the new Afghan authorities, many of them former foes of the Taliban and the Western military forces, mainly the U.S. military. The subsequent growth of the Taliban in Kandahar has been detailed by the Indian journalist Anand Gopal. He divides their subsequent rise into four periods: reorganization (2001-4), consolidation, recruitment of new fighters and new alliances (20046), regrouping after the devastating Coalition operations in the summer of 2006 and return to asymmetric warfare (2006-9), and responding to US/NATO military „surge‟ (2009-10).

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The years 2010-11 marked a new phase in the intensity of the struggle. It appears to include targeted assassination campaigns against senior members of government and its allies to prepare the ground for the Taliban‟s political dominance of the region in the event of either a negotiated settlement or outright military victory when the foreign forces have withdrawn. The Taliban have set up a shadow government in most parts under their control, appointing provincial and district governors, military commissions and shariah courts. These formal structures work in parallel with numerous informal networks through which the Taliban make and enforce decisions. The Taliban have intensified their grip on rural Kandahar through severe intimidation and widespread human rights abuses. More crucially, „‟a brutal assassination campaign against anyone even remotely connected to the government- tribal elders, government officials, aid workers, religious clerics, and others- succeeded in widening the gap between the local communities and the government‟‟ (Gopal, 2010:3).

The future By the end of the decade, the Karzai family and the Quetta Shura Taliban had „‟emerged as the most powerful forces‟‟ in Kandahar (Forsberg, 2010:6). On the government side, a strong personality driven political order had emerged, dominated by several commercial and military networks held together by the Karzai administration, his family and local and regional allies. This small oligarchy controlled transit routes, ran commercial and military networks, and through coercion and violence dominated politics and the provincial and regional economy tied to military and civilian contracting and the transit and drugs trade. Ahmad Wali Karzai was at the centre of these interconnected networks. He used his control over local militias and private security companies to enforce his political will in Kandahar and the region‟s politics and commerce. Nevertheless, there was contingency planning for a different future. President Karzai and his inner circle may have realised as early as 2006, and particularly in 2009 after election disputes soured relations and Obama announced a timetable for withdrawal of US troops, that the West was not a reliable partner (Forsberg, 2010:41). The realisation prompted Karzai to change course and begin building a power base independent of the West. Although weakened by recent setbacks, notably the killing of Ahmad Wali and Jan Mohammad Khan, he has succeeded in establishing a powerful and loyal base of support in the South by enlisting the cooperation of close family members and regional strongmen. President Karzai‟s ability to organise massive ballot-rigging and fraud during the 2009 presidential elections, his stand-off with the West and eventually getting re-elected for a second time was stark evidence of the power of his emerging southern empire. Ahmad Wali was a key element of this intricate web of power and domination. Other elements in the strategy was alliances with regional strongmen in the South like Arif Noorzai, Abdul Raziq and Matiullah Khan, and on the national level with Qasim Fahim (First Vice President), Karim Khalili (Second Vice President) and Ismail Khan (cabinet minister).. The rise of Ahmad Wali Karzai, Gen. Abdul Raziq and Matiullah Khan are closely tied to the role of foreign military forces and their links to the Afghan government. In the usual scheme of things, their removal from the scene, as in the case of Ahmad Wali, would have been filled by other aspiring entrepreneurs. But because the system that created and sustained themforemost being the U.S. military and the CIA- will undergo significant change, this critical support structure will be weakened or dismantled. The results are several. 30

First, the bar for the entry of new „strongmen‟ into the local political scene is raised. Second, the competition among existing powerbrokers- for access to Kabul, government positions, control of militias, transit routes and the drugs trade- will increase, especially if Gul Agha Sherzai is reinstated as governor. The competition may be „robust‟, but not lead out to an „all out war‟. Thirdly, these local strongmen, rather than the ANA given its institutional weaknesses, will be the first line of defence against the insurgents, or the first to split off and forge local deals. As we have seen, local strongmen benefited handsomely from their control over NATO supply routes and military spending. The key Kabul-Kandahar-Herat highway is controlled and protected by many armed groups linked to the Karzais and their allies. Commander Rohullah of the Watan Risk Management, a private security company owned by the Karzai family has extended his control over the entire region from Kabul to Kandahar, through his native Zabul. Further south, Abdul Raziq controls the route to Spin Boldak and Pakistan. To the north, Matiullah Khan, the new Chief of Police of Uruzgan controls the road from Kandahar to Tarin Kout. Westward, Arif Noorzai14 controls the routes to Helmand, Nimruz, Farah and to the border with Iran. With the departure of US/NATO, the value of holding the highways will be dramatically reduced and the cost of controlling them will be disproportionately high. It is likely that Kandahar‟s strongmen and their militias‟ control over these routes will diminish, especially in view of threats from the insurgency, but not disappear altogether. These routes will continue to play an important role in the drugs trade as well licit economic activities like trade in goods with neighbouring countries and international markets further afield. The alliances that President Karzai and his family have maintained will change. Existing allies such as Arif Noorzai, Abdul Raziq and Matiullah Khan will have incentives to strengthen their cooperation as the local dominance of the Karzai family fades and the expected return of Sherzai looms in the future. The duration and stability of this alignment will depend on Karzai‟s power in Kabul, who is appointed next governor of Kandahar, the level of patronage, and other gains that can be made from aligning with Karzai and his administration, as well as the strength of the insurgency. Karzai‟s decision not to run for presidency in 2014 will further intensify competition, both at the national level and for leadership and control in Kandahar and the broader southern region. With Ahmad Wali gone, President Karzai may well reinstate Sherzai as governor of Kandahar in order to stabilise the deteriorating security situation in the province and beyond. The return of Sherzai, a known nemesis of the Taliban in post-2001 Kandahar, could undermine Karzai‟s efforts to reconcile with the insurgents to contain their advance. Sherzai is likely to go on the „offensive‟ to marginalise rivals and consolidate his position at the outset, actions that would marginalise certain tribes and possibly boost the ranks of the insurgency. However, Sherzai will face constraints in his exercise of power, notably from other strongmen in the south, whose support he needs, as well as Karzai in Kabul. With his 14

Arif Noorzai, a mujahiddin commander during the 1980s and early 1990s is currently the Head of the Independent Directorate for the Protection of Public Spaces and Highways by Tribal Support, which gives him control over militias throughout the southern region. His uncle, Gen. Mohammad Younus Noorzai is the Commander of the Afghan Border Police, while his brother, Mirwais Noorzai is the deputy commander of 205th Police Corps, which commands ANP units in southern Afghanistan. Family placements in these strategic government posts enable Arif Noorzai to exert control over the smuggling routes throughout the southern region and beyond (Forsberg, 2010:34-35).

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American patrons going, Sherzai is increasingly vulnerable to pressure from all sides, and possibly more open to accommodation. The imminent and ever-present threat of insurgents should give him and other powerful elites in Kandahar an incentive to cooperate. Among the local strongmen, Arif Noorzai is more dependent on Kabul and the Karzai administration but has enough local power to be both an effective and loyal governor. Arif is related to the Karzais through marriage and has so far proven loyal in furthering the President‟s power in the South. His networks within the police, control over private militias and links to the drugs trade as well as the border trade gives him enough coercive and economic resources to help sustain an „elite pact‟. Nevertheless, a decline in ISAF/NATO contracts and development spending means that Kandahar‟s strongmen would need other resources to maintain their alliances and finance patronage politics. In the first instance, that makes the customs taxes from Spin Boldak vulnerable. The importance of poppy cultivation and drug smuggling would also increase. More crucially, the insurgents, who are stronger in Kandahar and the wider southern region than elsewhere in the country, are capable of changing the local power dynamics quite dramatically. If insurgent attacks increase, local militia commanders may not be able to withstand an offensive, particularly if the resource flow from the Coalition and the central government diminishes. As a result, deals might be struck with the insurgents or among themselves that will reduce Karzai‟s leverage over the local strongmen. More autonomous local strongmen may be even less accountable and more predatory than at present. Greater internal competition for wealth and power may also encourage them to seek support from foreign governments or other groups in the region. Going by past experience, this would likely intensify factional rivalries and prolong conflicts. The state of the insurgency in Kandahar is a key to future political developments in the south of Afghanistan and the country as a whole. The insurgents will invest great efforts to capture Kandahar. The province is a valuable prize in itself; its capture will also significantly improve their bargaining chances in the event of a national political settlement or, failing that, a critical asset in confrontation with northern rivals. It is unlikely and perhaps undesirable for the Taliban to capture Kabul and the provinces to the north of it, in view of a dramatically changed political landscape and strong anti-Taliban sentiments in non-Pashtun areas. Conclusions In sum, current trends suggest that the post-transition period in Kandahar will resemble the political economy of the early 1990s, when factional commanders and warlords, forced by the decline of super power patronage started to secure other means of financing. The result was a prolonged, low-intensity armed competition and factional fighting, consisting mainly of targeted and selective violence against local adversaries. There is also another aspect. The huge war-and-aid economy in Kandahar, and the near monopoly over it by a small oligopoly, has generated a new, powerful elite that has strong, vested interest in prolonging the conflict. The withdrawal of foreign forces and the reduction of military and development spending would lessen their access to „easy money‟ and raise questions about the solidity of their status and power. It could open up for a more leveled playing field of other social groups. In relation to the insurgents, anecdotal information from other parts of the country (Kunar 32

and Khost) indicate that withdrawal of foreign forces have resulted in the slowing down of the insurgency, fewer Taliban and US/NATO attacks, and a greater role for the Afghan National Army, which the locals seem to prefer over the international forces (Atal and Khosnood, 2011). At present, this appears to be a best-case scenario for Kandahar.

III. CONCLUSIONS

The Transition signals the beginning of the shrinking of the rentier state that has developed as a result of the massive international military and aid presence in Afghanistan during the past decade. From the perspective of long term sustainability and good governance, this is desirable. Accountability tends to follow the money flow; rentier elites have few incentives to respond to their populations since they do not depend on them for resources to sustain the state. Rentier states are therefore typically corrupt and undemocratic. Reversing the process, however, is likely to generate considerable conflict. The elites in of the Afghan rentier state have become entrenched. The only exception is the Western-supported technocrats, whose future position has become more uncertain. Among the rest, the main factions have the capacity to engage in „armed politics‟. They are engaged in deep conflicts among themselves over access to formal positions of political power, and they face an advancing insurgency. In this situation, reduced inflows of „easy money‟ from the war- and- aid economy – or the expectation that this will occur – is likely to intensify intra-elite competition and increase the incentives to accumulate wealth through illegal means or in the ilicit economy. Responses to the expectations of a reduced Western presence on the local level are context dependent and vary considerably. The three cases studied here suggests different probable scenarios: a return to localized, low-intensity conflict in the eastern province of Nangarhar, redefinition of the tacit intra-elite pact between the center and the northern province of Balkh, and at least in the short run, intensified conflict in Kandahar - the heart of the southern region. The scheduled drawdown of international military forces also opens up opportunities to contain the war and steer Afghanistan‟s developments in more sustainable directions. The withdrawal of US troops removes the ideological foundation for the Taliban insurgency and related militant groups. On the government side, the prospect of reduced Western support has generated new efforts to explore talks with the militants. The Transition is thus a watershed opportunity for a new political order to emerge that is less violent and more stable than the present. One likely trajectory entails a redefinition of center-periphery relations with greater devolution of power to the provinces - in practice, if not in formal terms. Some signs in this direction, stimulated by the Transition and the state of the emergency, are already evident. Future developments within Afghanistan, of course, are heavily dependent upon the interests and actions of foreign states and institutions over which Afghan elites have little or no control. The so-called international community is deeply divided, both in its regional Asian context and over the future of the Western military presence in Afghanistan. These divisions generate further uncertainty about the nature of the Transition and its aftermath. Within Afghanistan, this uncertainty in itself has destructive consequences. 33

Heightened uncertainty about the future heightens anxiety among Afghans about the future, encourages preoccupation with short-term profit and gain, and increased ethnic and intergroup tensions as individuals and groups seek assurances of safety in known solidarity networks. It also has encouraged a discourse about the future that is cast in the logic of the familiar security dilemma: a group arming itself in the expectation that „the other „will be hostile, will lead „the other‟ to do the same, thus creating mutual insecurity rather than security. The widespread militarization of Afghan society during the past decade – through a massive expansion of the army, the proliferation of officially sanctioned armed groups and the continued presence of numerous illegal armed groups – increases the possibility of future insecurity regardless of how the present insurgency is dealt with. The above analysis suggests some policy implications. In particular, greater clarity about the nature of the Transition , particularly the policy intentions of the United States towards Afghanistan and the region, and greater recognition of the problems raised by the rapid expansion of military institutions and armed groups nominally on the government side, would help reduce the present and likely future costs of the Transition.

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