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Afghanistan’s GDP to expand by 3% in 2021: ADB

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The Asian Development Bank (ADB) forecasts that Afghanistan’s gross domestic product GDP growth will increase by 3% in 2021 and 4% in 2022 after the normalization of business activity and market sentiment.

In its Asian Development Outlook (ADO) 2021 released on Wednesday, the ADB stated that Afghanistan’s economic growth is expected to recover this year and accelerate next year after a sharp decline in 2020 from the coronavirus disease (COVID-19) pandemic and continued violence and instability.

“Afghanistan’s economy experienced unprecedented disruption in 2020 due to COVID-19 pandemic, political instability and continued violence, which cut remittances, trade, and revenue,” said ADB Country Director for Afghanistan Narendra Singru. 

“With a successful COVID-19 vaccine rollout and post-pandemic recovery, the country should be on track to achieve economic growth this year and in 2022 as business activity and market sentiment normalize,” Singru said.

According to the report, inflation more than doubled from 2.3% in 2019 to 5.6% in 2020 driven by higher food prices. Food price inflation in 2020 was estimated at 10% with the highest spike recorded in April when border closure and panic buying propelled it to 16.6%. Inflation is projected to moderate to 5.0% in 2021 and 4.0% in 2022 as food supplies improve.

However, risks remain, including implementing vaccinations in remote and insecure areas, conflict, criminality, corruption, political instability, and broader social fragility. If unaddressed, these could weigh heavily on the economy and impede recovery.

“Supporting the recovery of micro, small, and medium-sized enterprises (MSMEs) hard hit by the pandemic is pivotal to safeguarding workers’ incomes and livelihoods, according to the report. Before the pandemic, MSMEs were estimated to provide nearly 1.6 million service and industry jobs. The government approved a 2-year support package worth $295 million in October 2020 to improve business conditions and implemented countercyclical measures that include support for MSMEs,” the report read.

The ADB suggests that Afghanistan should facilitate MSME access to markets by developing infrastructure, improving security, combating corruption, simplifying regulation, strengthening property rights and contract enforcement, and promoting innovation and better labor skills in order to improve the business environment.

“Increasing access to credit and further expanding the formal bank sector is also crucial,” the organization said.

“ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific while sustaining its efforts to eradicate extreme poverty. Established in 1966, it is owned by 68 members—49 from the region,” the report concluded.

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Iran calls for extending Herat railway to Uzbekistan border

Meanwhile, Afghanistan’s Ministry of Public Works said the country has significant potential to serve as a regional connectivity hub.

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Iran’s Minister of Roads and Urban Development, Farzana Sadeq, has called for extending Afghanistan’s railway network from Herat to the Termez border area in Uzbekistan to strengthen regional trade and transport links.

Farzana made the proposal during a specialised meeting on the Trans-Afghan Corridor in Astana, Kazakhstan, saying Iran is exploring ways to expand railway connectivity with Afghanistan and Uzbekistan.

She said the proposed route could create new opportunities for freight transportation and improve regional countries’ access to open waters. She added that the railway connection should eventually link with the wider railway networks of Central Asia and China.

The Iranian minister also proposed that countries along the Iran–Afghanistan–Tajikistan–Kyrgyzstan–China corridor hold a meeting under the Economic Cooperation Organization (ECO) to identify practical mechanisms for implementing the plan.

Referring to the Chabahar transit agreement between Iran, Afghanistan and India, Farzana said the port has the potential to facilitate the movement of goods from Afghanistan and Central Asian countries to international markets.

She also identified potential railway connections linking Afghanistan with Türkiye and Europe through Sarakhs and Razi, as well as access to the Caucasus and the Black Sea through Sarakhs and Jolfa, as projects worth pursuing within the regional transport network.

Meanwhile, Afghanistan’s Ministry of Public Works said the country has significant potential to serve as a regional connectivity hub. The ministry said Afghanistan welcomes investment from all countries, including Iran, in railway development and transit infrastructure and is ready to cooperate on such projects.

Transport ministers from Iran, Uzbekistan, Pakistan and Kazakhstan, along with the head of the Islamic Emirate of Afghanistan’s railway authority, attended the Trans-Afghan Corridor meeting in Astana.

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Dogharoun border handling 70% of Iran’s exports to Afghanistan

Dogharoun also accounted for 34 percent of the province’s imports and 20 percent of inbound transit goods from Afghanistan to Iran during the same period.

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Last Updated on: October 19, 2026

Mohsen Rokni, head of the Dogharoun border terminal, says the crossing accounted for 70 percent of Iran’s exports to Afghanistan during the first half of the current solar year, making it the leading export gateway among border crossings in Iran’s Razavi Khorasan Province.

According to Rokni, Dogharoun also accounted for 34 percent of the province’s imports and 20 percent of inbound transit goods from Afghanistan to Iran during the same period.

He said major Iranian exports through the crossing include construction materials, steel products, food items, fruits and vegetables, and petroleum products.

Located near the Iranian city of Taybad along the Afghan border, Dogharoun remains a key trade and transit route between the two countries.

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Regional partners seek progress on Trans-Afghan corridor and CASA railway

The discussions took place during the international NEW SILK WAY business forum in Astana, attended by senior transport officials from the five countries.

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Officials from Kazakhstan, Afghanistan, Uzbekistan, Pakistan and Iran have discussed ways to advance the Trans-Afghan transport corridor and the Central Asia-South Asia (CASA) railway project, aiming to strengthen regional connectivity and expand trade routes.

According to Kazakhstan’s Ministry of Transport, the discussions took place during the international NEW SILK WAY business forum in Astana, attended by senior transport officials from the five countries.

The meeting focused on the CASA railway project, which aims to improve transport links between Central, South and West Asia, increase freight capacity and provide better access to international markets and seaports.

Participants reviewed the project’s current status and practical implementation requirements, including route coordination, infrastructure development and the establishment of a cargo base.

They also discussed financing mechanisms, attracting potential investors and international financial institutions, and strengthening coordination among Kazakhstan, Uzbekistan, Afghanistan and Pakistan.

Kazakhstan’s Minister of Transport, Nurlan Sauranbaev, said the participating countries had reaffirmed their shared interest in developing the Trans-Afghan corridor and implementing the CASA railway project.

“It is important for us to move from discussions to practical action,” Sauranbaev said, adding that the project could create an additional transport link between the regions, increase transit capacity, expand freight opportunities and strengthen trade and economic ties.

Following the meeting, participants reaffirmed their commitment to continued cooperation and the development of practical measures to advance the project.

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