Part 1: A Closer Look at the Afghan Drug Production, Supply and Use
| Ali Mohammad Ali
There are different accounts of how the opium poppies made their way to Afghanistan originally: some say that it was Alexander the Great’s armies who brought it in the fourth century BC, others that it was Gengis Khan’s armies in the twelfth century; more likely it was brought to Afghanistan by Arab traders for medical purposes. In the thirteenth century, Marco Polo reported the existence poppy fields in Badakhshan. Certainly the Moghuls were making extensive use of opium. For the first time the Afghan authorities reported the presence of opium fields to the Society of Nations in Herat, Nangarhar and Badakhshan in 1924. Records of poppy cultivation in Afghanistan date no further back than 1932, according to UNODC. The Afghan government reported in 1937 that in 1932 3,846 hectares were under cultivation, producing 74.5 tons of opium. During the 1930s, the production and export of hashish also started taking off, according to some sources with the encouragement of the government. This is a small fraction of what the opium trade in Afghanistan would become after 2001, assuming the estimates are correct. The Afghan government forbade the cultivation of opium poppies in 1945, but the initial impact of the prohibition appears to have been limited. In 1956, Afghan authorities reported that production has fallen to just 12 tons, but felt the need to ban opium production again in 1957. Various UN and international assessments did not agree that the Afghan government was doing much to eradicate the problem and that smuggling towards the neighbouring countries continued without noticeable change. Throughout this period the authorities did not take any action against the production and trade of hashish. Only in 1973, the new republican government started clamping down on the cultivation of cannabis and on the trade of hashish in northern Afghanistan, with harsh measures including burning down houses and arresting farmers. 
By 1971, the Afghan government admitted that opium production had been increasing again and it was unable to suppress production, an assessment shared by a UN survey team in 1972. In reality, it was in the 1970s that Afghan opium production started taking off, as a result of effective bans on its production in Turkey, Iran and Pakistan. Already in 1973 prices of heroin were rising so fast that Afghan production was stimulated. Soon the U.S. government would cut aid to Afghanistan in protest at growing opium production. The final ingredient in the take off of opium production in Afghanistan was the beginning of a series of conflicts in 1978, which rapidly saw the control of the central government over the countryside shrink. Remaining production in Pakistan started quickly shifting to Afghanistan. 
UNODC estimated that, in 1980, Afghan opium production accounted for 19% of the world production. By the end of the first phase of the Afghan wars in 1992, when the pro-Soviet regime of President Najibullah fell, that percentage had gone up to 42%. Some factions of the armed opposition to the pro-Soviet regime topped up external funding from the United States, Saudi Arabia and other countries with funds deriving from drug smuggling, but it is also likely that the increase in production was due to heightened activity by freelance farmers and smugglers, who no longer faced any restraints.
During the 1990s, external funding to warring Afghan factions declined, resulting in an increased reliance on drug smuggling. Throughout the 1990s, according to UNODC estimates, Afghanistan produced consistently more than 50% of the world’s opium, with peaks of over 60%, until by the end of the decade the percentage rose above 70% and even close to 80%. The destruction inflicted on traditional agricultural crops also contributed to the rising importance of opium production, as the poppies were found to a resilient crop that could be stored in a small space for long periods of time, and had high market value.
The Taliban ban on opium in 2000 led to a collapse in production to 11% of the world’s total in 2001, in a context of falling world output (other producers did not have the time to replace missing Afghan production). The Taliban implemented the ban without offering any compensation or alternative to the farmers, causing severe decline in output of opium. The Taliban ban was the subject of much speculation: were the Taliban trying to cash large stocks of opium held by the traders? Their ban led to a major rise in prices, creating the ideal scenario for those who owned stocks and wanted to sell them. Or did the Taliban cut production because they were trying to obtain diplomatic recognition from Washington, or at least avoid the sanctions that the UN Security council was imposing on them? Analysts remain of different views in this regard.
The question whether the Taliban ban was sustainable or not was never answered because the Taliban regime was overthrown in 2001 and production restarted without much hindrance. The Taliban had some notorious drug smugglers supporting them, but so did the anti-Taliban coalition. By 2003, Afghanistan was accounting again for 74% of world opium production and from then onwards it would continue rising, eventually accounting for around 90% of it.
Drug Supply and Reduction
From the 74,000 hectares cultivated in Afghanistan in 2002, the cultivation of poppies expanded dramatically in subsequent years, despite some fluctuations dictated primarily by prices and plant illness. The peak (so far) was in 2014, with 224,000 hectares being planted according to UNODC. The latest data for 2016 shows 201,000 hectares being cultivated. Production is mostly concentrated in the south (around 60% in recent years) and in the west (around 25%), while the north -- including Badakhshan -- accounted for smaller proportions. Opium production peaked in 2007, with 7,400 tons, but that amount was quite exceptional. In 2016 production was estimated at 4,800 tons, as yield per hectare fluctuated wildly.
The first attempt to implement a counter-narcotics policy after the fall of the Taliban regime saw a British-sponsored plan to pay USD$350 for each jerib that they would eradicate. The plan proved very difficult to implement and was affected by widespread corruption. It had to be aborted after less than a year.
In 2004, counter-narcotics policy shifted towards targeting the smugglers, but corrupt Afghan security institutions allied with the biggest smugglers in targeting their competitors and rivals, favouring the emergence of vertical integration in the drug trade, and concentration of the trade in the hands of a relatively small number of small players. It has been alleged that the smugglers being targeted by the interdiction effort were pushed right into the arms of the re-emerging Taliban.
Before the end of 2004, there was a new shift towards forced eradication, dictated by evidence of rising production. The peak of manual eradication campaigns was in 2005-2009; it mainly achieved results in Nangarhar, where enforcement was stricter. However, it proved unsustainable because of the heavy burden on many farming families. Indeed, it was in 2007 that the all-time high in opium production was achieved, in the middle of the most robust eradication campaign to date. Greater success was achieved from 2008 onwards, reportedly thanks to the lobbying of tribal elders by governor Gul Agha Shirzai. Shirzai harbored political ambitions and wanted to cast himself in a positive light with the international community. Allegations that the eradication policies were pushing opium farmers into the hands of the Taliban also contributed to the declining enthusiasm for eradication. After a peak in 2006 (almost 16,000 hectares reported as eradicated), mostly in Nangarhar, in 2008-11 only 2,500-4,000 hectares of poppy land were eradicated, representing a tiny percentage of all land under poppy cultivation (1-2%). This was enough to upset and scare the farmers, but not enough to make a serious dent in the opium economy. Government officials mostly implemented eradication in a perfunctory way, in order to satisfy demands by the international community or by the government.
It is also well established that several high-ranking members of the political elite maintained close relations with drug traders, and benefited from this relationship. Undoubtedly, the policy of appointments to governorship and senior police positions in the provinces aroused the suspicion that individuals connected with the narco-traffickers were being placed in key positions to facilitate smuggling operations. It is not clear whether this was because positions were offered for sale to the highest bidder (and drug traffickers were well positioned to bid higher), a common tactic used to secure lucrative and influential positions in the Afghan Government, or because of alliances between politicians and drug traders. United Nations Assistance Mission for Afghanistan (UNAMA), for example, regularly provided the Ministry of Interior with blacklists of people involved in drug trafficking, recommending that they not be appointed to any senior position, only to see them ending up as governors and chiefs of police.
In 2009, a new shift in policy saw a return to the interdiction of drug trafficking, but this time focused on smugglers linked to the Taliban, while increasing expenditure on rural development as a means to wean producers off poppy cultivation and into other forms of livelihood. Official estimates put the dependency of the Taliban on drug revenue at 20-40%. By the end of the interdiction policy with the withdrawal of U.S. troops in 2013-14, the policy was assessed as having had a limited or irrelevant strategic impact. Moreover, opium seizures in the villages alienated villagers, who often kept the financial reserves in the form of raw opium.
A resurgence of eradication efforts in 2012-13 (around 7,000-9,000 hectares eradicated per year) was not sustained because of the withdrawal of foreign troops, which had provided a backup for these efforts. From 2014 onwards, the limited interdiction efforts still underway were being carried out by Afghan security forces, and corruption and nepotism again affected the outcome. With the massive loss of control over the rural space that began in 2014-16, the Afghan authorities are now hardly in a position to implement any eradication policies. Only 355 hectares were reported to have been eradicated in 2016, a drop of 91% over the previous year.
Poppy eradication appeared to be dead, and counter-narcotics efforts were in decline already in 2013, as foreign troops were beginning to pull out of many districts, leaving the Afghan security forces alone to cope with the insurgency. Between 2012-13 and 2014-15, seizures of heroin declined by 32%, of dry opium by 14% and of morphine by 25%. Similarly, the 2,661 drug traffickers arrested in 2014-15 represented an 11% decline on the previous years. Partial figures for 2015-16 suggest a stabilization of interdiction activities, with 1,000 arrests in the first four months of the year.
Qualitatively, interdiction operation actually scored high in 2016, with arrests of very prominent drug traffickers such as Haji Watan and the son of Haji Lala Jan Ishaqzai, plus nine other “international drug traffickers.” It is too early to assess the impact of the new wave of interdiction operations, but -- undoubtedly -- 2016 has been the most successful year so far in this regard. However, it is worth asking whether all drug traders are being pursued with the same energy. Are some of them, especially those better connected with the political elite, able to manipulate interdiction to their own advantage? This is a key question to be explored in the months to come. While there is good evidence that President Ashraf Ghani is serious about targeting high level drug traffickers rather than farmers, whether his administration will succeed or not in pursuing a more successful policy than in previous years remains to be seen.
Use of Drugs
Of the 4,000-6,000 tons of opium produced in Afghanistan annually, in 2007 UNODC estimated that at least 33% is refined into heroin locally. The percentage is likely to have gone up since then. Raw opium is smoked in large quantities mostly in Iran and in other parts of the Middle East, with Afghanistan, Russia and Europe following in their consumption levels. Significant amounts of Afghan opium are also still being smuggled abroad for refining there. Major traders employ sometimes hundreds of opium buyers, roaming the country on their behalf, buying the cheapest opium (and hashish) from farmers.
A relatively small portion of Afghan drugs feeds the domestic market, which is estimated at about 2.5-3 million users, about half of whom are opioid users. Among the main export markets for Afghan drugs are Iran (3.5-6 million users, of which at least 2 million opioid users), Pakistan (6.7 million users, of which 2.7 million are opioid users), Russia (7.5-8.5 million users of all drugs), and Ukraine (0.5 million). The most populous European countries all have a few hundreds thousand opioid users each. The world total might exceed 21 million users of opiates.
Overall opium production in Afghanistan oscillates between 4,000 and 6,000 tons per year, depending mainly on environmental factors. The large majority of producers are small independent farmers, perhaps 300,000 of them. At least some of the druglords and some of the largest drug traders have been buying land to turn it into poppy fields. In some cases, drug traders already own thousands of hectares of land.
Druglords typically own several heroin refineries each as well, and many big drug traders do. Some of the biggest drug traders control tens of refineries.  Full control over the production chain results in income for the druglord that is 10-15% higher. The most efficient refiners offer the highest discount, while others are able to offer only smaller discounts. The smaller the size of the narcotics business, the less likely that any vertical integration might be in place.
Heroin refining capacity in Afghanistan has increased even faster than opium production. The general trend has, of course, been one of operators shifting from an opium-based business towards a heroin-based one, because of the higher profit margins allowed by heroin. The tendency to focus on the export market seems to be a common trend, affecting opium and hashish traders as well, particularly for small smugglers who cannot compete with the prices offered by the bigger smugglers.  Small smugglers are even willing to take the risk of taking the drugs across borders, in order to make a good profit. However, the heroin trade requires significant start-up capital; opium-only traders and smugglers survive at the low end of the market, trapped in a low investment/low margins cycle. In part, they too cope by selling more and more across the border, particularly in Iran where demand for opium remains high. Increasingly, even simple farmers are beginning to do the same, in order to earn more returns.
Much of the narcotics business in Afghanistan is based around personal relations built over time. A trader in the south might send his opium to be refined in Nangarhar, bypassing refineries in Helmand, not just because of lower costs in Nangarhar, but also because of being allied with -- or on good business terms with -- a refiner in Nangarhar. A trader in the north might buy opium or heroin in the south or in the east, bypassing refiners in Badakhshan, for the same reasons. Once an operator establishes precious contact with foreign narcotics traders, he will have to bring narcotics to the nearest border, regardless of where he is able to purchase them.
Druglords and the major traders are able to purchase opium (or refined heroin) when prices are lowest and stockpile it until prices rise and they can make a good profit. Maintaining stockpiles also allows the smugglers to never run out of supply. Small smugglers who lack political protection are not keen to stockpile much, because of the risk of raids by security forces who could seize their stock. Some smugglers also only order opium or heroin when they get orders from their trading counterparts abroad.
The final price of heroin ready for export is determined by a series of costs, and by expectations of profit among the various actors involved. The price mark-ups grow rapidly as the Afghan border recedes into the distance. By the time heroin makes it to Europe, the mark-up is between 3,000%-4,000%.
 UNODC, “The Opium Economy In Afghanistan: An International Problem,” Vienna, 2003; Alain Labrousse, “Afghanistan: opium de guerre, opium de paix,” Paris; Fayard, 2005. UNODC, “The Opium Economy In Afghanistan: An International Problem,” Vienna, 2003; Alain Labrousse, Afghanistan: opium de guerre, opium de paix,” Paris; Fayard, 2005. UNODC, “The Opium Economy In Afghanistan: An International Problem,” Vienna, 2003; Alain Labrousse, “Afghanistan: opium de guerre, opium de paix,” Paris; Fayard, 2005. UNODC, “The Opium Economy In Afghanistan: An International Problem,” Vienna, 2003; Alain Labrousse, “Afghanistan: opium de guerre, opium de paix,” Paris; Fayard, 2005. UNODC, “The Opium Economy In Afghanistan: An International Problem’, Vienna, 2003; Alain Labrousse, “Afghanistan: opium de guerre, opium de paix,” Paris; Fayard, 2005. UNODC, “The Opium Economy In Afghanistan: An International Problem,” Vienna, 2003. UNODC, “Opium Survey 2016,” Vienna, 2016. Equivalent to approximately 2,000 square meters.  Vanda Felbab-Brown, “No Easy Exit: Drugs and Counternarcotics Policies in Afghanistan,” Brookings, 2016. Vanda Felbab-Brown, “No Easy Exit: Drugs and Counternarcotics Policies in Afghanistan,” Brookings, 2016. David Mansfield and Adam Pain, “Evidence from the Field: Understanding Changing Levels of Opium Poppy Cultivation in Afghanistan,” Kabul : AREU, November 2007; Vanda Felbab-Brown, “No Easy Exit: Drugs and Counternarcotics Policies in Afghanistan,” Brookings, 2016. Matthieu Aikins, “Afghanistan: The Making of a Narco State,” Rolling Stone, December 4, 2014; Carl Forsberg and Tim Sullivan, “Criminal Patronage Networks and the Struggle to Rebuild the Afghan State,” Impunity, May 24, 2016. UNODC, “Opium Survey 2016,” Vienna, 2016; Liana Rosen and Kenneth Katzman, “Afghanistan: Drug Trafficking and the 2014 Transition,” Washington: Congressional Research Service, 2014. “Afghanistan Drug Report 2015,” Kabul: Ministry for Counter-Narcotics, 2015. “Hundreds arrested in Afghanistan’s counter-narcotics operations,” Press TV, Aug. 11, 2016. Anisa Shaheed, “MoI Detains 11 Drug Kingpins In Past Year: Official,” Tolo News, 25 September 2016.  UNODC, World Drugs report, Vienna, 2010. Interview with smuggler in Nangarhar Province, 2015. State Department, “2016 International Narcotics Control Strategy Report,” Washington, 2016. UNODC, “The opium/heroin market,” Vienna, 2010. Interview with smuggler in Helmand Province, 2016. Interview with smuggler in Kandahar province, 2016. Interview with smugglers in Kandahar and Herat, 2016. Interview with smuggler in Parwan province, 2016. Interview with drug traders, 2016. Interview with smugglers in Nimruz and Badakhshan provinces, 2016. Interview with smuggler in Kandahar Province, 2015.  Interview with drug traders, 2016. Interview with smuggler in Nangarhar Province, 2016. Interview with smugglers in Nangarhar, Badakhshan and Nimruz Provinces, 2016.