Afghanistan vs. Iran

Ahmad Shah DURRANI unified the Pashtun tribes and founded Afghanistan in 1747. The country served as a buffer between the British and Russian Empires until it won independence from notional British control in 1919. A brief experiment in increased democracy ended in a 1973 coup and a 1978 communist countercoup. The Soviet Union invaded in 1979 to support the tottering Afghan communist regime, touching off a long and destructive war. The USSR withdrew in 1989 under relentless pressure by internationally supported anti-communist mujahidin rebels. A series of subsequent civil wars saw Kabul finally fall in 1996 to the Taliban, a hardline Pakistani-sponsored movement that emerged in 1994 to end the country's civil war and anarchy. Following the 11 September 2001 terrorist attacks, a US, Allied, and anti-Taliban Northern Alliance military action toppled the Taliban for sheltering Usama BIN LADIN.

A UN-sponsored Bonn Conference in 2001 established a process for political reconstruction that included the adoption of a new constitution, a presidential election in 2004, and National Assembly elections in 2005. In December 2004, Hamid KARZAI became the first democratically elected president of Afghanistan, and the National Assembly was inaugurated the following December. KARZAI was reelected in August 2009 for a second term. The 2014 presidential election was the country's first to include a runoff, which featured the top two vote-getters from the first round, Abdullah ABDULLAH and Ashraf GHANI. Throughout the summer of 2014, their campaigns disputed the results and traded accusations of fraud, leading to a US-led diplomatic intervention that included a full vote audit as well as political negotiations between the two camps. In September 2014, GHANI and ABDULLAH agreed to form the Government of National Unity, with GHANI inaugurated as president and ABDULLAH elevated to the newly-created position of chief executive officer. The day after the inauguration, the GHANI administration signed the US-Afghan Bilateral Security Agreement and NATO Status of Forces Agreement, which provide the legal basis for the post-2014 international military presence in Afghanistan. After two postponements, the next presidential election was held in September 2019.

The Taliban remains a serious challenge for the Afghan Government in almost every province. The Taliban still considers itself the rightful government of Afghanistan, and it remains a capable and confident insurgent force fighting for the withdrawal of foreign military forces from Afghanistan, establishment of sharia law, and rewriting of the Afghan constitution. In 2019, negotiations between the US and the Taliban in Doha entered their highest level yet, building on momentum that began in late 2018. Underlying the negotiations is the unsettled state of Afghan politics, and prospects for a sustainable political settlement remain unclear.

Known as Persia until 1935, Iran became an Islamic republic in 1979 after the ruling monarchy was overthrown and Shah Mohammad Reza PAHLAVI was forced into exile. Conservative clerical forces led by Ayatollah Ruhollah KHOMEINI established a theocratic system of government with ultimate political authority vested in a learned religious scholar referred to commonly as the Supreme Leader who, according to the constitution, is accountable only to the Assembly of Experts (AOE) - a popularly elected 88-member body of clerics. US-Iranian relations became strained when a group of Iranian students seized the US Embassy in Tehran in November 1979 and held embassy personnel hostages until mid-January 1981. The US cut off diplomatic relations with Iran in April 1980. During the period 1980-88, Iran fought a bloody, indecisive war with Iraq that eventually expanded into the Persian Gulf and led to clashes between US Navy and Iranian military forces. Iran has been designated a state sponsor of terrorism and was subject to US, UN, and EU economic sanctions and export controls because of its continued involvement in terrorism and concerns over possible military dimensions of its nuclear program until Joint Comprehensive Plan of Action (JCPOA) Implementation Day in 2016. The US began gradually re-imposing sanctions on Iran after the US withdrawal from JCPOA in May 2018.

Following the election of reformer Hojjat ol-Eslam Mohammad KHATAMI as president in 1997 and a reformist Majles (legislature) in 2000, a campaign to foster political reform in response to popular dissatisfaction was initiated. The movement floundered as conservative politicians, supported by the Supreme Leader, unelected institutions of authority like the Council of Guardians, and the security services reversed and blocked reform measures while increasing security repression. Starting with nationwide municipal elections in 2003 and continuing through Majles elections in 2004, conservatives reestablished control over Iran's elected government institutions, which culminated with the August 2005 inauguration of hardliner Mahmud AHMADI-NEJAD as president. His controversial reelection in June 2009 sparked nationwide protests over allegations of electoral fraud, but the protests were quickly suppressed. Deteriorating economic conditions due primarily to government mismanagement and international sanctions prompted at least two major economically based protests in July and October 2012, but Iran's internal security situation remained stable. President AHMADI-NEJAD's independent streak angered regime establishment figures, including the Supreme Leader, leading to conservative opposition to his agenda for the last year of his presidency, and an alienation of his political supporters. In June 2013 Iranians elected a centrist cleric Dr. Hasan Fereidun ROHANI to the presidency. He is a longtime senior member in the regime, but has made promises of reforming society and Iran's foreign policy. The UN Security Council has passed a number of resolutions calling for Iran to suspend its uranium enrichment and reprocessing activities and comply with its IAEA obligations and responsibilities, and in July 2015 Iran and the five permanent members, plus Germany (P5+1) signed the JCPOA under which Iran agreed to restrictions on its nuclear program in exchange for sanctions relief. Iran held elections in 2016 for the AOE and Majles, resulting in a conservative-controlled AOE and a Majles that many Iranians perceive as more supportive of the ROHANI administration than the previous, conservative-dominated body. ROHANI was reelected president in May 2017. Economic concerns once again led to nationwide protests in December 2017 and January 2018 but they were contained by Iran's security services. Additional widespread economic protests broke out in November 2019 in response to the raised price of subsidized gasoline.

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note - the Ministry of Justice licensed 72 political parties as of April 2019 

Prior to 2001, Afghanistan was an extremely poor, landlocked, and foreign aid-dependent country. Increased domestic economic activity occurred following the US-led invasion, as well as significant international economic development assistance. This increased activity expanded access to water, electricity, sanitation, education, and health services, and fostered consistent growth in government revenues since 2014. While international security forces have been drawing down since 2012, with much higher U.S. forces' drawdowns occurring since 2017, economic progress continues, albeit uneven across sectors and key economic indicators. After recovering from the 2018 drought and growing 3.9% in 2019, political instability, expiring international financial commitments, and the COVID-19 pandemic have wrought significant adversity on the Afghan economy, with a projected 5% contraction.

Current political parties' power-sharing agreement following the September 2019 presidential elections as well as ongoing Taliban attacks and peace talks have led to Afghan economic instability. This instability, coupled with expiring international grant and assistance, endangers recent fiscal gains and has led to more internally displaced persons. In November 2020, Afghanistan secured $12 billion in additional international aid for 2021-2025, much of which is conditional upon Taliban peace progress. Additionally, Afghanistan continues to experience influxes of repatriating Afghanis, mostly from Iran, significantly straining economic and security institutions.

Afghanistan's trade deficit remains at approximately 31% of GDP and is highly dependent on financing through grants and aid. While Afghan agricultural growth remains consistent, recent industrial and services growth have been enormously impacted by COVID-19 lockdowns and trade cessations. While trade with the People's Republic of China has rapidly expanded in recent years, Afghanistan still relies heavily upon India and Pakistan as export partners but is more diverse in its import partners. Furthermore, Afghanistan still struggles to effectively enforce business contracts, facilitate easy tax collection, and enable greater international trade for domestic enterprises.

Current Afghan priorities focus on the following goals:

• Securing international economic agreements, many of which are contingent on Taliban peace progress;
• Increasing exports to $2 billion USD by 2023;
• Continuing to expand government revenue collection;
• Countering corruption and navigating challenges from the power-sharing agreement; and
• Developing a strong private sector that can empower the economy.

Iran's economy is marked by statist policies, inefficiencies, and reliance on oil and gas exports, but Iran also possesses significant agricultural, industrial, and service sectors. The Iranian government directly owns and operates hundreds of state-owned enterprises and indirectly controls many companies affiliated with the country's security forces. Distortions - including corruption, price controls, subsidies, and a banking system holding billions of dollars of non-performing loans - weigh down the economy, undermining the potential for private-sector-led growth.

Private sector activity includes small-scale workshops, farming, some manufacturing, and services, in addition to medium-scale construction, cement production, mining, and metalworking. Significant informal market activity flourishes and corruption is widespread.

The lifting of most nuclear-related sanctions under the Joint Comprehensive Plan of Action (JCPOA) in January 2016 sparked a restoration of Iran's oil production and revenue that drove rapid GDP growth, but economic growth declined in 2017 as oil production plateaued. The economy continues to suffer from low levels of investment and declines in productivity since before the JCPOA, and from high levels of unemployment, especially among women and college-educated Iranian youth.

In May 2017, the re-election of President Hasan RUHANI generated widespread public expectations that the economic benefits of the JCPOA would expand and reach all levels of society. RUHANI will need to implement structural reforms that strengthen the banking sector and improve Iran's business climate to attract foreign investment and encourage the growth of the private sector. Sanctions that are not related to Iran's nuclear program remain in effect, and these-plus fears over the possible re-imposition of nuclear-related sanctions-will continue to deter foreign investors from engaging with Iran.

despite decades of war, Afghanistan has successfully rebuilt infrastructure to create a functional telecom sector that covers nearly all of the population; due to mountainous geography, country relies on its mobile network; mobile broadband penetration growing, but is still low compared to other countries in Asia; operator launched LTE in Kabul; World Bank and other donors support development of a nationwide fiber backbone; terrestrial cable connectivity to five neighboring countries; work on the `Wakhan Corridor Fiber Optic Survey Project' to connect to China is nearing completion; major importer of broadcasting equipment from UAE (2020)

Afghan, Coalition, and Pakistan military meet periodically to clarify the alignment of the boundary on the ground and on maps and since 2014 have met to discuss collaboration on the Taliban insurgency and counterterrorism efforts; Afghan and Iranian commissioners have discussed boundary monument densification and resurvey; Iran protests Afghanistan's restricting flow of dammed Helmand River tributaries during drought; Pakistan has sent troops across and built fences along some remote tribal areas of its treaty-defined Durand Line border with Afghanistan which serve as bases for foreign terrorists and other illegal activities; Russia remains concerned about the smuggling of poppy derivatives from Afghanistan through Central Asian countries

Iran protests Afghanistan's limiting flow of dammed Helmand River tributaries during drought; Iraq's lack of a maritime boundary with Iran prompts jurisdiction disputes beyond the mouth of the Shatt al Arab in the Persian Gulf; Iran and UAE dispute Tunb Islands and Abu Musa Island, which are occupied by Iran; Azerbaijan, Kazakhstan, and Russia ratified Caspian seabed delimitation treaties based on equidistance, while Iran continues to insist on a one-fifth slice of the sea; Afghan and Iranian commissioners have discussed boundary monument densification and resurvey

Tier 3 - Afghanistan does not fully comply with the minimum standards for the elimination of trafficking in persons and is not making significant efforts to do so; the government decreased law enforcement efforts against civilian and official perpetrators of trafficking, and officials complicit in recruitment and use of child soldiers and the sexual exploitation of boys continued to operate with impunity; authorities continued to arrest, detain, and penalize many trafficking victims, including punishing sex trafficking victims for "moral crimes"; the judiciary remained underfunded, understaffed, and undertrained (2020)