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Pakistan and China competing to take advantage of weakening Afghan economy: Report

Kabul (Afghanistan): China and Pakistan are in a hurry to take advantage of the Afghan economy as both have announced some tempting benefits for Afghanistan, which will benefit the former and the latter to a great extent in the near future, Thursday (17 September) said in a media report. War-torn Afghanistan is going through great financial difficulties. And the new rulers lack the experience to deal with the complex economic issues that the poor country is facing.

The former head of Afghanistan’s central bank also fled the country, leaving financial decisions in disarray. However, the Taliban recently appointed a new chief. News website InsideOver reported that most Afghan officials dealing with financial issues now have dual citizenship and that the new authorities have enough reason to be wary of the outbreak that could spread to their families.

Any initiative, even one through floating ideas or discussions, without action, can be risky. According to InsideOver, this opens up possibilities for Pakistani officials, such as the military that helped the Taliban win last month, to run, or guide, the Afghan economy, at least for the time being. can be drafted.

Islamabad and Beijing have already made plans to try to take advantage of the situation. The initial step was taken by Islamabad recently, it announced to trade with Afghanistan in Pakistani Rupee. Finance Minister Shaukat Tarin gave the reason for the shortage of dollars in Kabul. He also offered to help the Taliban fill technical positions that were lying vacant due to recent evacuations. The communist regime also started wooing the Taliban.

Recently, China, which is known for lending money easily, has committed USD 31 million to boost the Afghan economy. The Taliban, in turn, have also shown interest in an alliance with China’s BRI. As other countries decide whether they should recognize a Taliban interim government, Beijing and Islamabad have begun to act on financial issues related to Afghanistan. However, in all these developments, China appears to be a major beneficiary as the Pakistani economy and currency is already dependent on China. And since 2018, Islamabad began trading largely in the Chinese currency yuan with Beijing, making Sino-Pak trade yuan-based, raising prospects for a three-way reconciliation of economies, IndsideOver said. . In this, being the strongest currency the Chinese Yuan would gain massively while it would allow the other two to gain somewhat.

Pakistan seems to have benefited, acting as an intermediary and exploiting resources through transit and facilitation charges. But, at present, the Pakistani economy is in constant trouble and runs huge deficits in terms of debt servicing, among other indicators. On Wednesday, the Pakistani rupee hit an all-time low of Rs 169.94 against the US dollar at the inter-bank. Market.

According to Insideover, Afghanistan is one of the most vulnerable, fragile economies in the world Despite receiving Western aid for two decades. The World Bank stated that in Afghanistan, poverty is endemic, as is underdevelopment. It also said that almost 90 per cent of Afghanistan’s population lives on less than USD 2 a day and Kabul, which received USD 4.2 billion in aid in 2019, may not get any this year. Beijing and Islamabad are closely monitoring developments in Afghanistan.

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