Afghanistan’s Conflict Minerals: The Crime-State-Insurgent Nexus

Feb 16, 2012

Afghanistan is most notoriously recognized for its cultivation and production of illegal narcotics, recently galvanizing its position as the world’s number one producer of illicit opium and cannabis resin (hashish). Yet there exists an equally thriving shadow economy revolving around precious stones such as emeralds, lapis lazuli, and increasingly from minerals and ores such as chromite, coal, gold and iron.[1]

In 2010, the U.S. Department of Defense released its findings from a geological survey that confirmed Afghanistan’s untapped mineral reserves are worth an astounding $1 trillion.[2] Wahidullah Shahrani, the current Afghan minister for mines, claimed that other geological assessments and industry reports place Afghanistan’s mineral wealth at $3 trillion or more.[3] Past wars, contemporary conflict and the subsequent influx of international assistance, however, has forced all development and reconstruction efforts to unfold in a highly criminalized political and economic space—including Afghanistan’s immature yet promising mining sector.

This article examines the evolution of natural resource exploitation by various violent entrepreneurs—such as local kachakbarari (smuggling) networks, corrupt powerbrokers, and insurgent groups such as the Taliban, the Haqqani network, and their Pakistani counterparts—in the period before and during Afghanistan’s contemporary conflict. Understanding this connection is important since state, criminal and insurgent elements on both sides of the Afghanistan-Pakistan border continue to reap profits from illegal excavations, protection rackets, informal taxation, and cross-border trafficking. This nexus is helping create new forms of state and private patronage systems as the realms of business, crime, conflict and corruption intersect in the already convoluted war economy of Afghanistan.

Origins of Illegal Mining and Smuggling in Afghanistan
The small-scale excavation and trafficking of precious stones and other mining commodities such as chromite, marble, and coal has long played a role in organized criminal activities and fundraising strategies for militant groups throughout the past four decades of conflict in Afghanistan. In general, the smuggling of contraband constitutes an enduring Afghan economic legacy: smuggling comprised as much as 20-25% of Afghanistan’s total foreign trade in the early 1970s.[4]

In contrast to smuggling, the development of Afghanistan’s exceedingly vast yet complex array of mineral reserves has been handicapped by its landlocked position, inefficient governance and corruption, lack of critical and modern infrastructure such as railways and highways, and its vulnerability to earthquakes, which hampers long-term geological extraction. Although the United Kingdom, United States, France, Sweden, Japan, and Russia have all engaged in resource exploration throughout Afghanistan since a British expedition first uncovered Afghan mineral wealth in 1815, these efforts largely failed except for the limited extraction of oil, natural gas, salt, coal, marble, and lapis lazuli precious stones.[5]

Following the Saur (April) Revolution of 1978, the Soviet invasion of Afghanistan the following year led to the onset of a nationwide civil war, which engulfed Afghanistan from 1980 until the collapse of the Afghan regime in 1992.[6] Afghanistan’s litany of resistance forces, collectively known as mujahidin, soon developed a variety of state and private patronage sources, and engaged in multiple licit and illicit fundraising efforts to help bolster their war chests. The mining and extraction of lapis lazuli, world-class emeralds, and other precious gemstones in the northern provinces of Badakhshan and the Panjshir Valley became a critical source of revenue for the Jamaat-i-Islami resistance movement, one of the seven largest mujahidin parties that fought against the Soviet occupation. When Jamaat-i-Islami came to power in 1992, Afghan Defense Minister Ahmad Shah Massoud nationalized these mines, and through the assistance of a Polish company (Intercommerce) collected an estimated $200 million a year from the trade in precious gemstones.[7]

Emerald mining in the Panjshir Valley became a critical component of the war economy around 1985, with most of the lucrative extraction centered on the village of Khenj, an area then under the control of the local Jamaat commander Bismillah Khan.[8]

Following the rise of the Taliban movement in 1994 and their seizure of state power in 1996, anti-Taliban militias came to unite under the umbrella group the United Islamic Front. The United Islamic Front continued to engage in precious stone extraction and trafficking in the Panjshir Valley, Takhar, and Badakhshan, allegedly earning between $60 and $200 million per year from the trade.[9] These anti-Taliban militias led by Ahmad Shah Massoud would eventually acquire weapons, ammunition, and even helicopters to fight against the Taliban from legendary black market arms dealer Viktor Bout—exchanging emeralds and other precious stones for weapons under a “commodity for commodity” agreement.[10]

The resistance by no means monopolized the extraction of precious stones and other commodities. The state power at the time, the Taliban regime, also engaged in simple and unskilled mining efforts during their tenure between 1996 and 2001. In 1997, the Taliban commander in charge of the government-owned marble mines in Helmand Province employed some 500 laborers armed only with primitive hand tools, extracting the marble through rudimentary blasting, subsequently scarring the finished product which substantially reduced its worth.[11] The widespread phenomenon of unskilled, unregulated, largely localized mining efforts inside and outside of state control continued unabated during this period, with United Islamic Front commanders operating nearly 100 emerald mines in the Panjshir Valley alone.

The Contemporary Flow of Illicit Minerals
The illegal acquisition and seizure of land, black market mining, and the trafficking of these resources surged following the collapse of the Taliban regime in November 2001. In 2005, the Afghan Ministry for Mines and Industries indicated nearly 80% of all Afghan mines remained under control of rogue commanders or criminals, with some of these mines being controlled by non-state actors since 1992.[12] Several of Afghanistan’s most contested and insurgent plagued areas—such as Khost, Ghazni, Logar, Paktia, and Baghlan provinces—also contain large mineral deposits and precious stone mines.

Bordering the restive tribal areas of Pakistan, Khost Province is home to a number of criminal mining syndicates, many of which specialize in the surface extraction of chromite.[13] In May 2010, the director of Khost’s mining department, Engineer Laiq, admitted the provincial government has failed to prevent the smuggling and illegal extraction of Khost’s chromite ore despite the presence of 300 armed security guards tasked with securing the mines.[14] Afghan security officials indicate these syndicates are small in number, namely a few large families, who smuggle the ore across the border to Pakistan where members of the Wazir tribe buy and trade the mineral to international customers. Analysts previously speculated that the illegal extraction of chromite in Khost amounts to nearly 20 million Afghanis ($413,907) per year, although the Afghan government believes it loses one million Afghanis ($20,695) in lost revenue from illegal chromite excavations in Khost each day.[15] Besides lost revenue, the Afghan government faces a growing threat from the merger between corrupt business elites and local criminal syndicates who outsource chromite smuggling operations and pay “protection” fees to members of Tehrik-i-Taliban Pakistan (TTP) and Haqqani network affiliates to ensure that the movement of illegally mined chromites reach market destinations in Pakistan without interference.

The most powerful of these syndicates was led by a licit and licensed mining company that excavated chromite ore in Khost for three years without paying royalties to the government, and used a network of local smugglers from the Tanai tribe to illegally smuggle the ore to North Waziristan where members of the TTP would ensure the convoys were safely escorted in exchange for a payment.[16]

Many of those involved in the smuggling include members of the Zadran tribe, the same tribal affiliation of the much vaunted Haqqani network, while those in charge of chromite trading belong to the Madda Khel clan of the Utman Wazir tribe, the same tribe and clan of wanted Taliban commander Hafiz Gul Bahadar.[17] These connections have not been lost on security forces operating in eastern Afghanistan who face a multifaceted threat from local Taliban insurgents being supplied with deadly improvised explosive devices and suicide bombers from Hafiz Gul Bahadar and the Haqqani network, as well as the TTP.

Between March and October 2011, at least two U.S. drone strikes targeted Taliban fighters who were loyal to Pakistani Taliban commander Hafiz Gul Bahadar and linked to the smuggling and trading of chromite. On March 17, two U.S. missiles slammed into a compound in the Nawai Adda area of North Waziristan, reportedly killing more than 40 Madda Khel tribesmen and Taliban fighters attending a jirga (tribal meeting) to help resolve a dispute between two parties over the sale of a chromite mine that cost approximately $100,000.[18] Among the dead was Sherabat Khan, a senior deputy to Hafiz Gul Bahadar, who was sent to mediate the dispute on behalf of the Taliban. On October 31, up to four missiles fired from a U.S. drone killed four men, including a local chromite trader named Saeedur Rahman, in the Doga Madakhel village in North Waziristan—an area located in the Dattakhel tehsil that is controlled by Hafiz Gul Bahadar.[19]

Bordering Khost is Zormat district of Paktia Province, another major hub in the trade of illicit minerals (and narcotics) in eastern Afghanistan. Situated between some of the largest chromite deposits in Afghanistan, namely the Deh Yak district of Ghazni Province and the Dadukhel desert of Logar, Zormat is a hotly contested district where locally operated smuggling syndicates—and linked to those in Khost—dictate the flow of illicit goods destined for larger markets outside the province and in neighboring Pakistan.

In Logar Province, there are approximately 20 precious stone mines in addition to the massive Anyak copper mine.[20] Among these are the massive surface deposits of chromite in the Dadukhel desert, located approximately 10 kilometers east of the provincial capital of Pul-i-Alam. In 2006, hundreds of armed men were reportedly extracting chromite ore from the Dadukhel area at night; they smuggled the ore to Gardez and on through the Jaji district of Paktia for destinations in Parachinar, Pakistan.[21] Smugglers in this area often hide their haul of chromite under loads of timber, nearly all of which is bound for bara (contraband) markets in Pakistan. By September 2010, the Afghan Ministry for Mines acknowledged that efforts to secure the chromite fields in Logar have failed just as they have in Khost, with an estimated 400 tons of the precious ore smuggled out of the country every day, in part because the provincial governor and chief of police continue to play integral roles in the area’s black market chromite trade.[22]

In addition to chromite extraction and smuggling, small and medium scale unlicensed extraction of coal in the central provinces of Bamyan and Baghlan has also bolstered the war chests of local smuggling syndicates and criminal networks. In July 2011, local Afghan media reports suggested that among the 100 coal mines functioning in the central province of Bamyan, the government only controls and operates six of them.[23] Gold, rubies, and emerald extraction continues through unlicensed operators connected to powerful business and political elites in Takhar, Badakhshan, Nuristan, Baghlan, and Panjshir provinces.

Conclusion
Amidst the headlines of several lucrative mining contracts signed between Afghanistan and multiple international mining firms from China and India, the proliferation of illegal excavations by violent entrepreneurs threatens and stunts the natural growth of Afghanistan’s burgeoning mining sector. In May 2011, Afghanistan’s parliament cited security shortcomings, infrastructure and technicality problems as the most serious obstacles in developing Afghanistan’s mining sector. “Mafia groups are making use of mines more than the Afghan government,” Gul Ahmad Azimi, an Afghan senator, said during the session.[24]

Furthermore, corrupt government officials (at all levels) and illicit business practices, such as paying bribes, also exacerbate the situation. In the summer of 2009, the rate for government security forces to “protect” smugglers and their convoys in Ghazni Province reportedly ranged between $400 and $2,000 per truck. Similar stories were also reported in Badakhshan, Takhar, Baghlan, Khost and Logar provinces in late 2011.[25]

As the internal revenue streams funding militant and criminal groups continue to change, armed groups will rely upon a diverse array of income generation that includes illegal mining, the smuggling of these minerals and other contraband, collecting illegal taxes, and offering protection for the trafficking of these illicit “conflict minerals.” Given the examples of illegal mining in Khost, Logar, and Paktia, it is clear the predatory and parasitic exploitation of Afghanistan’s mineral reserves by opportunistic and violent entrepreneurs will continue to enhance the war chests of armed belligerents and fuel corruption for the foreseeable future.

Matthew C. DuPée is an Afghanistan analyst for the U.S. Defense Department and previously served as a research associate at the Naval Postgraduate School’s Remote Sensing Center and for the Program for Culture & Conflict Studies. He holds an M.A. in Regional Security Studies (South Asia) from the Naval Postgraduate School and continues his research on organized crime, insurgency, illegal mineral extraction, and the narcotics industry in Southwest Asia.

[1] Afghanistan is ranked the world’s largest producer of illicit opiates, supplying approximately 90% of the illicit global demand for the past eight years in a row. The first UNODC Afghan Cannabis Survey published in 2010 confirmed suspicions that Afghanistan is now the world’s largest producer of cannabis resin, better known as hashish, accounting for approximately 1,500 to 3,500 metric tons of resin in 2009, and upwards of 3,700 metric tons in 2010.

[2] James Risen, “U.S. Identifies Vast Mineral Riches in Afghanistan,” New York Times, June 13, 2010. The $1 trillion estimate derived from Stephen G. Peters, Trude V.V. King, Thomas J. Mack, and Michael P. Chornack, “Summaries of Important Areas for Mineral Investment and Production Opportunities of Nonfuel Minerals in Afghanistan,” U.S. Geological Survey, September 29, 2011.

[3] Deb Reichman and Amir Shah, “Afghan Mineral Wealth May Be At Least $3 Trillion,” Associated Press, June 17, 2010.

[4] Jagdish Bhwagwati and Bent Hansen, “A Theoretical Analysis of Smuggling,” Quarterly Journal of Economics 87:2 (1973).

[5] John F. Shroder, Jr., “Physical Resources and the Development of Afghanistan,” Studies in Comparative International Development 16:3-4 (1981).

[6] The civil war continued through 1992 and into 1994, ushering in a new era of chaos, war, and destruction that prompted the rise of the Taliban movement in southern Afghanistan in 1994. The small band of religious warriors quickly gained popular support by restoring law and order by disarming violent and illegally armed groups. By 1996, the Taliban controlled nearly 85% of Afghanistan’s territory, including the capital, Kabul.

[7] Conrad Schetter, “The ‘Bazaar Economy’ of Afghanistan: A Comprehensive Approach,” in Christine Noelle-Karimi, Conrad Schetter and Reinhard Schlagintweit eds., Afghanistan – A Country without a State? (Frankfurt: IKO Verlag, 2002).

[8] Khan emerged as a key commander for Ahmad Shah Massoud and later became the army chief of staff in the post-Taliban regime, ultimately being appointed as the interior minister for the Karzai administration in 2010. See “The Massoud Memorial Mining Institute 8th Draft Proposal,” GeoVision Inc., December 19, 2002.

[9] Michael Renner, “The Anatomy of Resource Wars,” World Watch Paper #162, October 2002; Schetter.

[10] Douglas Farah and Stephen Braun, Merchant of Death: Money, Guns, Planes and the Man Who Makes War Possible (Hoboken, NJ: Wiley and Sons Press, 2007); Camelia Entekhabi-Fard, “Northern Alliance Veteran Hopes Emeralds Are Key Part of Afghanistan’s Economic Recovery,” Eurasianet.org, October 14, 2002.

[11] Ahmed Rashid, The Taliban: Militant Islam, Oil & Fundamentalism in Central Asia (New Haven, CT: Yale University Press, 2001).

[12] “The Afghan Government has no Control over Mines,” Pajhwok Afghan News, April 14, 2005.

[13] Chromite, an ore used as a hardening agent in the manufacturing of steel, is found predominately in Tanai, Jaji, and Mangal districts of Khost, the Deh Yak district of Ghazni, and the Dadukhel area in Logar.

[14] Saboor Mangal, “Illegal Mining Continues in Khost,” Pajhwok Afghan News, May 25, 2010.

[15] Michael Bhatia, Tom Garcia, and MSG Rachel Ridenour, “Operation ‘Sarmaayey Melee’ (National Treasure),” Human Terrain Team Assessment, January 2008.

[16] Personal interview, Javed Noorani, an Afghan extractive industries analyst, January 7, 2012.

[17] The Haqqani clan is part of the Mezi sub-tribe of the Zadran, and Hafiz Gul Bahadar is a senior tribal leader of the Utman Wazir. Personal interview, government official from Khost who spoke on condition of anonymity, January 6, 2012; Saida Sulaiman and Syed Adnan Ali Shah Bukhari, “Hafiz Gul Bahadur: A Profile of the Leader of the North Waziristan Taliban,” Terrorism Monitor 7:9 (2009).

[18] “80 People Reportedly Killed in U.S. Drone Strike in Pakistan,” Xinhua, March 17, 2011.

[19] Malik Mumtaz Khan, “Four Miners Killed in North Waziristan Drone Attack,” The News International, October 31, 2011.

[20] According to the late Abdullah Wardak, who served as the governor of Logar until he was assassinated in 2008, there are 20 functioning mines in Logar. Kabir Haqmal, “Precious Stones are Illegally Extracted in Afghanistan,” BBC Pashto, June 3, 2008.

[21] Shah Pur Arab, “Feature: Illegal Excavations of Chromites in Logar,” Pajhwok Afghan News, December 21, 2006; Shah Pur Arab, “Afghan Police Arrest 16 as Hundreds Embark on Chromite Mining,” Pajhwok Afghan News, December 23, 2006; Shah Pur Arab, “20 Tons of Chromites Recovered in Logar,” Pajhwok Afghan News, March 29, 2008.

[22] “Tonnes of Chromite Daily Smuggled out of Afghanistan,” ToloNews, September 6, 2010;  “Logar Residents Rally Against Governor,” Daily Outlook Afghanistan, April 20, 2011; personal interview, Javed Noorani, an Afghan extractive industries analyst, January 7, 2012.

[23] Hadi Ghafari, “Child Labor Exploited in Bamyan Coal Mines,” Pajhwok Afghan News, July 12, 2011.

[24] “Afghanistan Unable to Use Mines: Senate House,” ToloNews, May 31, 2011.

[25] Richard A. Oppel, “Corruption Undercuts Hopes for Afghan Police,” New York Times, April 8, 2009; personal interview, Javed Noorani, an Afghan extractive industries analyst, January 7, 2012.