World Bank Projects Over 3% Growth for Afghanistan in 2026 Amid Trade Shocks

The World Bank estimates more than 3% economic growth for Afghanistan in 2026, a figure that follows an approximately 20% economic collapse after the Taliban's takeover. This projected growth comes amid about 3% annual population growth and more than 70% of the population living below the poverty line, conditions that require at least 10% growth for noticeable improvement. The projection signals a relative halt in decline rather than sustainable progress.

A major shock stemmed from severed economic relations with Pakistan, Afghanistan's primary route to global markets including India, the United Arab Emirates and Turkey. Exports to Pakistan totaled about $743 million. Based on World Bank assessments of 2025 trade volumes, the trade halt caused average daily losses of about $6.5 million. From late October 2025, direct losses reached about $910 million, exceeding $1.5 billion when including transit disruptions and third-party market losses. This led to shortages of basic goods and price increases of up to 35%.

Iran emerged as an alternative, with annual exports to Afghanistan of nearly $3.5 billion and transit routes via Chabahar and Bandar Abbas providing access to Middle East markets and India, where annual trade volume is about $1 billion. However, escalating conflicts involving the United States, Israel and Iran disrupted these routes, effectively blockading Afghanistan's access to international markets from both directions.

Trade with Central Asian countries including Uzbekistan, Tajikistan, Turkmenistan and Kazakhstan has increased but cannot replace Pakistan and Iran due to geographical limitations and lack of effective access to global markets. Short-term effects include higher prices and supply shortages, with long-term pressures on investments and livelihoods.