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USIP reports Afghanistan’s banking system dysfunctional

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The United States Institute of Peace (USIP) has said in a new report that Afghanistan’s banking system remains largely dysfunctional.

This report evaluated the Afghan banking system as inefficient. It said that the lack of access to Afghanistan’s foreign exchange reserves and the obstacles in the way of printing banknotes add to these problems.

USIP has warned that the decrease in cash and humanitarian aid will have a destructive effect on the economy and financial system of Afghanistan.

The report highlights systemic challenges within Afghanistan’s banking sector, including a backlog of bad loans and limited depositor access to funds due to withdrawal restrictions imposed by Da Afghanistan Bank (DAB).

“Afghanistan’s precarious economy is facing a new set of multidimensional risks as humanitarian aid — delivered in massive shipments of U.S. cash dollars — shrinks rapidly amid competing demands from other crises around the world. The dollar inflows, moved under U.N. auspices, have helped stabilize the Afghan economy, cover its mammoth trade deficit, and inject monetary liquidity into commerce,” the report said.

“With much smaller cash infusions, in line with a general reduction in aid, the suffering of Afghanistan’s poverty-stricken population is likely to increase,” USIP has warned.

The author of this report has suggested that, contrary to the confrontation between the countries of the world and the Islamic Emirate on the issue of women’s rights, other countries and international organizations can play a supporting role in facilitating the printing of more Afghan banknotes and allow the use of investment income from the Afghanistan Fund in Switzerland to stabilize the macroeconomics.

Da Afghanistan Bank (DAB) has not yet reacted to this report, but it has already emphasized that it will continue its efforts by implementing reasonable monetary policies that lead to maintaining the value of the afghani against other currencies.

DAB also stressed it will pay special attention to the strength of the banking sector and bring reforms and improvements as much as possible in this sector.

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Afghan and Iranian officials discuss expanding economic cooperation

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Ahmad Jan Bilal, General Director of State-Owned Corporations, met on Tuesday with Iran’s Ambassador to Kabul, Ali Reza Bikdeli, to discuss expanding bilateral economic cooperation and following up on issues raised during his recent visit to Iran.

According to a statement from the General Directorate of State-Owned Companies, the meeting focused on reviewing ways to implement discussions held with Iranian officials during Bilal’s visit.

Bikdeli described the visit as positive and productive, stressing the importance of following up on the issues discussed and taking practical steps to advance bilateral cooperation.

He said Iran is ready to cooperate with Afghanistan in oil and gas exploration, extraction and exports, refinery construction, agriculture, water and electricity.

Bilal, for his part, said the Islamic Emirate is interested in expanding joint cooperation with Iran in energy, agriculture, industrial development and other economic sectors. He added that his office would work with the Iranian side to turn the proposed areas of cooperation into practical initiatives.

Bilal also reaffirmed his office’s commitment to following up on the issues discussed during his recent visit to Iran and working towards their implementation in coordination with Iranian officials.

Bilal recently visited Iran at the head of a delegation, holding talks with several Iranian officials on expanding economic, trade and investment ties, particularly in the state-owned companies sector.

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Ariana Airlines reduces Kabul–Islamabad–Kabul airfares by $20

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Ariana Afghan Airlines announced on Tuesday a reduction in ticket prices for flights on the Kabul–Islamabad–Kabul route from $190 to $170.

According to the airline, passengers can now purchase tickets for this route at $20 less than the previous fare.

The airline has also set a special fare of $150 for students travelling on this route.

Ariana Afghan Airlines said the move aims to reduce travel costs and make air travel more affordable and accessible for passengers and students.

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Afghanistan and Russia discuss expanding economic ties and boosting bilateral trade

During the meeting, Muttaqi stressed that Afghanistan and Russia should expand economic cooperation based on shared interests and mutual benefits.

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Afghanistan’s Foreign Minister Amir Khan Muttaqi has met with Zamir Kabulov, Russian President’s Special Representative for Afghanistan, to discuss strengthening bilateral relations, expanding economic cooperation and increasing trade between the two countries.

During the meeting, Muttaqi stressed that Afghanistan and Russia should expand economic cooperation based on shared interests and mutual benefits.

Kabulov, meanwhile, praised the Islamic Emirate’s efforts to combat drug trafficking and cultivation, saying reports by some international organisations on the issue do not reflect the realities on the ground.

Muttaqi reiterated that the Islamic Emirate remains committed to combating drug cultivation, production and trafficking, describing these efforts as important for the security and stability of both Afghanistan and the wider region.

The meeting comes amid continued efforts by Kabul and Moscow to strengthen diplomatic and economic engagement and explore opportunities for broader bilateral cooperation.

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