The fate of Afghan reserves in the United States

the story So Far: On February 11, US President Joe Biden signed an executive order declaring that the United States – which froze the Afghan Reserve Fund belonging to Afghanistan’s central bank – would fund that fund for the humanitarian needs of the Afghan people. of about $3.5 billion. In addition, he also opened up the possibility that a portion of the fund would consider American victims of terrorism. The announcement effectively barred the Taliban administration in Kabul from receiving funding. The Taliban have called the move ‘theft’.

What is the source of Afghan funds in the US?

At the time of Kabul’s fall into the hands of the Taliban in August 2021, at least $9 billion belonging to Afghanistan was held abroad in various countries. The United States had about $7 billion and others such as Switzerland, Germany, the United Arab Emirates and two other countries had the remainder. The money was from Da Afghanistan Bank (DAB). The US government froze the fund but speculation about its fate has been rife since the Taliban returned to Kabul. The complication is also partly due to the fact that the Taliban have not received any international recognition in the past six months since the fall of Kabul. Major regional powers such as India have urged the international community to be slow in identifying extremists who have figures like Sirajuddin Haqqani, who remain on the UN terror list. To make matters worse, the Taliban has so far failed to reserve a seat for Afghanistan at the United Nations. Afghan analysts like Khalilullah Safi say that in addition to central bank reserves, the US government also has some gold reserves in Afghanistan that date back to the days of King Zahir Shah’s government.

What is the domestic situation in Afghanistan?

The economic situation in Afghanistan immediately crashed after the takeover by the Taliban as supply lines were disrupted and inflation pushed up prices across the country. An unusual draft came as an additional burden. As the revenue system collapsed within the country, the Taliban administration found itself unable to proceed along the lines described in the February 29, 2020 agreement between the US and the Taliban delegation in Doha, Qatar. The Taliban–US agreement envisaged that when the Taliban joined the mainstream government, an Afghan Islamic government would be formed as determined by intra-Afghan negotiations. The US promised in that agreement that it would “seek international cooperation for the reconstruction” of Afghanistan. But in the absence of a military takeover by the Taliban and any “inter-Afghan talks”, the financial sections of the agreement were not activated. However, the Taliban is demanding that $9 billion belongs to the Afghan people and that the US should return the money.

What is America’s argument on controlling the reserve?

The US does not agree that the reserve belongs to the Afghan people. White House officials claimed that “fundamentally, these reserves, which include US$7 billion, … are the proceeds of sustained and significant international aid” that has helped Afghanistan over the past two decades under President Hamid Karzai and President Trump. received during the regime. Ashraf Ghani. They argue that a portion of that amount came from international donors. According to official US sources, the move was not sudden as they have been contemplating for the past several months how some of that amount could be used to meet the humanitarian needs of the Afghan people. The US has announced that it will use (through international aid agencies) about $3.5 billion to support the humanitarian needs of the Afghan people. This contribution is expected to be channeled through international aid and relief agencies such as the World Food Program which are involved in providing food aid to Afghanistan.

How are reserves relevant to victims of terrorism in the US?

An official said in February, while part of the reserves, $3.5 billion, has been designated for a trust fund to support humanitarian aid for Afghanistan, the rest of the $7 billion in total is yet to be planned for the fund. Has been. 11. The official said the rest of the money would be kept in the US, to be used by US victims of terrorism against the Taliban as per the current trial. The Taliban have long been the focus of attention in United States courts, where victims of the 9/11 attacks have often claimed damages from the group for providing support to Osama bin Laden’s al Qaeda network, which led the United States Attacks were carried out at all places. A team of 19 billion hijackers and civilian aircraft. A group of 150 members of the families of those killed in the 9/11 attacks sued the Taliban and al Qaeda in 2010. These families have urged the US government to allow them access to the funds. The White House official said the transfer of funds to these families of the victims would be subject to a court order. So the court’s announcement in New York would ultimately determine the future course of the funds.

What has been the Taliban’s response?

Taliban spokesmen have called President Biden’s announcement “unilateral”. The Taliban’s “Permanent Representative-designate to the United Nations” Suhail Shaheen has assured that the Afghanistan Bank reserve does not belong to “governments or factions” and is the “property” of the Afghan people. It is for the implementation of “monetary policy, facilitating trade and promoting the financial system of the country”. He described the US move as an “injustice” against the Afghan people.