AFGHANISTAN: REGIONAL TRADE DISRUPTIONS EXPOSE ECONOMIC FRAGILITIES

   Tue, 20 May 2025

The recent India-Pakistan clashes severely disrupted Afghanistan’s trade routes, underscoring the country’s overreliance on Pakistani transit and prompting renewed interest in Iran’s Chabahar Port. While modest economic growth in 2024 and projected growth over the coming years signal some resilience, structural weaknesses persist, including a widening trade deficit, a constrained banking sector, and gender-based economic restrictions. Russia’s removal of the Taliban from its terror list signals deeper bilateral engagement, though prospects for large-scale foreign investment remain constrained by international sanctions and operational challenges.

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