How do the Taliban control the 'world's best performing currency, the Afghani', in poverty-stricken Afghanistan

If we talk about the currency of Afghanistan, today one US dollar is equal to about 79 Afghanis.  In a poor economy like Pakistan, the same dollar is available at around 290 Pakistani rupees, and in a booming economy like India, 84 Indian rupees are equivalent to one US dollar.

 Last week when Bloomberg, a financial reporting organization, declared Afghanistan's currency as the best performing currency for the quarter (i.e. the last three months), many people were surprised, while Pakistan's  Some users on social media called it a 'success' for the ruling Taliban in Afghanistan.

 However, people are also surprised that a country whose existing 'government' is not formally recognized by any country in the world, which is under international sanctions, whose overseas assets are frozen and where hunger and poverty are rampant.  Dere Hai What is so special about its currency that it has been the world's 'best performing' currency for the past three months?

 In this report, we examine how this was possible and the factors that made the Afghan currency the 'best performing' currency.

Afghanistan's currency 'third best currency'

At the end of last month, it was reported that the Afghan currency, known as the 'Afghani', has become so strong against the dollar that one dollar has become equal to 73 Afghani, but the next day it has reached 78 Afghani again.  On the evening of October 1, one dollar was equal to 83 Afghanis.

 According to a Bloomberg report, Afghanistan's currency has improved by 9 percent against the dollar since July this year, making it the third best-performing currency after Colombia's peso and Sri Lanka's rupee.  has come out.

 The report states that the main reason for this improvement is the Taliban government's control over the currency, billions of dollars received by Afghanistan in aid, and the increase in remittances sent by Afghan citizens living abroad to their relatives. It should be remembered that according to a recent report of the World Bank, about 66 percent of the citizens living in Afghanistan can hardly afford the basic necessities of life, while unemployment in the country is at its peak.

 According to the United Nations, since the Taliban took control of the country in 2021, the United Nations has sent 5.8 billion dollars in aid.Former Caretaker Governor of the Afghan Bank and a long-time official at the Afghan Central Bank, Khan Afzal Hudawal, says that the improvement in the value of the Afghan currency is not real but artificial.

 He said that it is artificial because it is not a result of improvement in Afghanistan's production process.  Under the Taliban regime, no commercial and productive activities are taking place in Afghanistan, but the UN aid funds (in dollar form) and some remittances are deposited in banks to control hunger and poverty.  is being done due to which the currency of Afghanistan has improved.

 He said that one of the reasons for the improvement of the Afghan currency in the Bloomberg report is that the currency of most countries in the region has depreciated against the dollar in recent days, but artificial and temporary measures.  The value of the Afghan currency has increased due to.

 He further said that there are various reasons why the value of the Afghan currency has not decreased and one of the reasons is that the Afghan currency has not yet entered the world market because when the Central Bank introduced the dollar into the open market and it  If you keep it balanced, the situation can be clear.  He said that in countries like Afghanistan, the currency exchange rate is not a factor related to the country's economic development.