Latest News
Afghanistan economy under pressure as Pakistan shocks reshape trade flows
Afghanistan’s economy continued to face strong headwinds in late 2025 as concurrent shocks — including mass refugee returns, drought, earthquakes, and shifting regional dynamics — strained growth and weakened investment momentum, according to the latest Afghanistan Economic Monitor released by the World Bank.
The report says that while low inflation and stable revenues have supported modest economic expansion, rapid population growth driven by large-scale returns from Iran and Pakistan has outpaced job creation, limiting improvements in average household incomes.
Inflation eased slightly in September 2025, with the Consumer Price Index falling 0.4 percent month-on-month as food prices declined. Fresh and dried fruits dropped by 4.6 percent due to seasonal harvests, while small increases were recorded in vegetables and spices.
Non-food inflation rose marginally, with housing costs climbing 1.7 percent amid rising rents in Kabul and other major cities. Year-on-year inflation slowed to 2.1 percent, down from 3.1 percent in August.
The Afghani strengthened against the U.S. dollar in both monthly and annual terms, but lower domestic inflation offset much of the nominal gain. The Real Effective Exchange Rate fell 1.1 percent, helping maintain Afghanistan’s external competitiveness against its major trading partners.
Trade flows were significantly disrupted by the mid-October closure of the Durand Line crossings with Pakistan, historically Afghanistan’s largest trade corridor. Despite the disruption, exporters quickly rerouted goods through Iran and Central Asia. The trade deficit narrowed slightly to $0.88 billion, supported by a 13 percent rebound in exports to $267 million.
Food exports — now the backbone of Afghanistan’s export economy — surged, reaching $ 238million in October and rising more than 22 percent over the first seven months of FY2025. India emerged as Afghanistan’s top export destination, accounting for 50 percent of October’s shipments, while Pakistan’s share declined sharply due to crossing closures.
Imports rose 2 percent month-on-month to $1.15 billion but fell 4.5 percent year-on-year. A structural shift toward Iran and Central Asia accelerated, with Iran supplying 29 percent of Afghanistan’s total imports so far in FY2025, followed by the United Arab Emirates at 19 percent.
The report warns that Afghanistan’s increasing dependence on food exports and redirected trade routes leaves the economy vulnerable to climate shocks and further regional instability, underscoring the need for strengthened infrastructure, diversified markets, and increased investment.
Latest News
Officials discuss strengthening cooperation between Kabul and Doha municipalities
Latest News
Coordinated attacks in Balochistan kill 15 Pakistani soldiers and 18 civilians
Pakistani authorities accused India of supporting the group and alleged that New Delhi is backing militant activity in Balochistan. India has not responded to the accusations.
At least 15 Pakistani soldiers and 18 civilians were killed in a series of coordinated attacks in Pakistan’s southwestern Balochistan province on Saturday, according to the Pakistani military.
The military said the attacks were carried out by the Baloch Liberation Army (BLA), prompting security forces to launch a large-scale counter-operation across the region. Officials said the operation resulted in the deaths of 92 militants.
The separatist group, which operates under the name Baloch Liberation Army, later claimed responsibility for the assaults.
Pakistani authorities accused India of supporting the group and alleged that New Delhi is backing militant activity in Balochistan. India has not responded to the accusations.
Interior Minister Mohsin Naqvi described the attackers as highly organized and claimed foreign involvement. “These were not ordinary terrorists. India is behind these attacks, and we will expose them globally,” he said.
Former U.S. special envoy for Afghanistan peace Zalmay Khalilzad said Pakistan’s long-standing approach to security in Balochistan has been ineffective, arguing that the situation requires a fundamental change in strategy.
Responding to Pakistan’s allegations, Indian Ministry of External Affairs spokesperson Randhir Jaiswal said New Delhi “categorically rejects” what he described as baseless claims, accusing Pakistan of attempting to deflect attention from its own internal challenges.
He said Pakistan should focus on addressing long-standing grievances in the region rather than repeating what he called unfounded accusations after every violent incident. Jaiswal added that Pakistan’s record on suppression, brutality, and human rights violations is well documented.
Latest News
Afghanistan, Turkmenistan discuss TAPI, rail and power projects in Herat meeting
Baradar also urged Turkmenistan to clarify its position on the Torghundi–Herat railway project, noting that Kazakhstan has shown strong interest in its implementation.
Afghanistan’s Deputy Prime Minister for Economic Affairs, Mullah Abdul Ghani Baradar, met on Sunday in Herat with Turkmenistan’s Foreign Minister, Rashid Meredov, to discuss major regional connectivity and energy projects.
The meeting was attended also by Afghanistan’s Minister of Mines and Petroleum Hedayatullah Badri, Minister of Energy and Water Mohammad Younus Akhundzada, as well as Turkmenistan’s ministers of transport and railways, state officials, and the head of the Turkmengaz state company, along with senior officials from both sides.
During the talks, the two delegations reviewed progress on the TAPI gas pipeline, TAP power transmission project, railway development, and electricity cooperation. Baradar said the launch of the TAPI project has strengthened ties between Afghanistan, Turkmenistan, and other regional countries, adding that Saudi Arabia’s Delta International Company has expressed interest in investing in multiple aspects of the project.
According to Baradar, Delta International is willing to invest in gas purchases from the TAPI project, expanding Turkmenistan’s major gas fields, constructing and extending the gas pipeline from Ghorian district of Herat to Spin Boldak in Kandahar and onward to the Indian border, as well as building a large modern gas hub at Pakistan’s Gwadar port.
Baradar also urged Turkmenistan to clarify its position on the Torghundi–Herat railway project, noting that Kazakhstan has shown strong interest in its implementation. He reaffirmed Afghanistan’s readiness to finalize the TAP project route map and pledged full cooperation on electricity transmission to Bala Murghab, Khomab and Qarqin districts, along with other regional connectivity initiatives.
He further emphasized the importance of creating job opportunities for Afghans through ongoing and future projects.
Speaking at the meeting, Turkmenistan’s Foreign Minister Rashid Meredov thanked the Islamic Emirate for facilitating the implementation of the TAPI project and said construction is expected to reach Herat city by the end of the current year. He welcomed the interest of foreign companies in investing in the project and stressed the need for close coordination.
Meredov also expressed Turkmenistan’s readiness to invest in the Torghundi–Herat railway project, noting that practical work has already begun in Torghundi. He added that Turkmenistan is prepared to increase electricity exports to Afghanistan through five transmission routes.
In addition, the two sides discussed expanding trade, enhancing banking cooperation, creating employment opportunities, and jointly managing economic projects across various sectors.
The meeting concluded with technical teams from both countries presenting detailed updates on the progress of ongoing projects.
-
Sport5 days agoAFC Futsal Asian Cup 2026: Day One Review
-
Sport4 days agoAfghanistan shine on Day Two of AFC Futsal Asian Cup Indonesia 2026
-
Sport5 days agoScotland name Afghanistan-born Zainullah Ihsan in T20 World Cup squad
-
Sport4 days agoAfghanistan eye second straight win ahead of Malaysia clash at AFC Futsal Asian Cup
-
Sport20 hours agoAFC Futsal Asian Cup: Afghanistan to face Iran in crucial Group D clash
-
Latest News4 days agoAustralia announces $50 million in new humanitarian aid for Afghanistan
-
Sport3 days agoAfghanistan dominates Malaysia 7–0 in AFC Futsal Asian Cup
-
Sport2 days agoT20 World Cup 2026: Afghanistan national cricket team arrives in India
