How states flail and fail: What Modi and Shah could learn from the Afghanistan tragedy

For those wondering, if there are any sub-regional or national lessons for South Asian nations to draw from Afghanistan’s own condition after the US military pulled out and the Taliban took over the country, the clear answer is: Yes, there are.

These lessons related to internalising processes of “state-institution building”; the need to avoid coercive forms of top-down governance without local cooperation and community support, and recognising the counterproductive economic effects of heavy foreign aid dependence.

Let’s begin with the last point first.

As a noted economist recently pointed out:

“Foreign aid is a steroid. It can protect against, and help with recovery from disasters, humanitarian crises, pandemics, disease outbreaks. But it does not facilitate economic transformation, and can-do huge damage when it’s magnitude rises to double digit levels of GDP. Countries that have shaken off aid addiction have done so due to leadership that made ‘exit from aid’ a strategic objective. That’s the big difference between Pakistan and Bangladesh, Cambodia and Vietnam.”

Afghan economic growth started stalling after 2012, once foreign aid started receding, from a high of about 50% of GDP (largely being remitted from the US to finance its war). The big injection of foreign money or investment did not translate into sustainable domestic growth.

As foreign money artificially raised domestic spending power without increasing domestic productivity or creating alternative sources for revenue mobilisation, imports continued rising three-fold while exports remained stagnant.

Any sane economic policy advisor would know how the focus on “aid-supported investments” need to be directly connected with the objective of raising domestic productivity, say for Afghan farmers, their local investors and entrepreneurs for greater economic and social mobility for those positioned at the bottom of the development pyramid.

In fact, despite aid being as high as 50% of GDP, as economist Atif Mian recently highlighted, the fraction of Afghan people living below poverty rose from 34% to 55%. America’s war in Afghanistan in all its 20 years failed to “build stuff” better and more efficiently for the Afghan people.

For worse, the local national government and provincial establishment allowed this to happen, experiencing the ills of moral hazard, where, an addiction to aid for financing operations crowded out the motivation to move out from a chronic state of import dependency, to become self-reliant.

Top-down approach

But what about the American experiment with instituting a “top-down” governance approach?

The West’s meltdown in Afghanistan has clearly shown how democratic institutions cannot be established by force nor imported through foreign aid. America’s efforts in the Middle East have shown the same results, again and again. The European Union now is facing the same set of questions for members like Hungary and Poland too, which have observed a serious dent in their democratic credentials under a rise in authoritarian, undemocratic leadership.

In case of Afghanistan, the US must have understood quite early on that the only sustainable way to create a stable, self-reliant nation with some degree of semblance of sovereign law and order was to establish or develop robust state-institutions.

Afghanistan’s political landscape lacked robust state-institutions, a functioning security force, courts, and a competent bureaucracy, which was exploited upon by the American establishment to transfer even more resources (call this “aid”) and provide “knowledge support” through foreigners.

Nation-building or a democratic conduct in institutional propriety doesn’t work for a top-down, state-first process. As economist Daren Acemoglu recently stated, “US policymakers, in context to Afghanistan, were following a ‘venerable tradition’ in political science. The assumption is [was] that if you can establish overwhelming military dominance over a territory and subdue all other sources of power, you can then impose your will. Yet in most places, this theory is only half right, at best; and in Afghanistan, it was dead wrong.”

So, what can other South Asian nations-including India, learn from the Afghan experience?

To answer this, it might be useful to draw upon the joint work of Daren Acemoglu and James Robinson from their 2019 book, The Narrow Corridor: States, Societies, And The Fate of Liberty. In it, Robinson and Acemoglu explain how “top-down” processes in governance rarely work in a deeply heterogeneous society that is organised around local customs, norms, and where state institutions have long been absent or found to be impaired.

Compromise and cooperation

The only successful cases of top-down governance approach in Asia – evident from the Qin dynasty in China or the success of the Ottoman Empire, or Akbar’s rule in India under the Mughal empire – were engineered by compromise and cooperation, not by brutish force or coercive action.

In such a model of cooperation-induced governance based on social trust, the state is not imposed on a society as a Leviathan i.e. against society’s wishes, but rather, state institutions build legitimacy for better enforcement of a state’s will (its rules and institutional guidelines) by securing a “modicum of popular support”. That, never happened in Afghanistan.

For India too, the current context of a heavily centralised, top-down governance model under Narendra Modi and Amit Shah is already seeing the nation-state downgrading itself from a functional to a flailing state. The continued downward trajectory under a neo-patrimonious conduct, a top-down heavy-handed governance approach may soon see it transitioning into a failing state.

If state-building proceeds against a society’s own wishes – or fails to gather its trust and cooperation – such efforts produce even greater collective resentment, inducing a feeling of negative solidarity, or worse, giving way to violent anti-state militant action or civil wars. Democracies in danger, under authoritarian regimes may well learn to be wary of this.

In recollection, some might say how ridiculously stupid it was for the US to push for a “state-first strategy” in Afghanistan, given its military’s past experience in Vietnam, and Iraq. But, it would be even more stupid for democratic nation-states in the neighbourhood (including India) not only not to learn from the perils of “coerced, top-down governance approaches” but also learn to govern through greater local cooperation and community-led-support.

Deepanshu Mohan is Associate Professor and Director, Centre for New Economics Studies, Jindal School of Liberal Arts and Humanities, OP Jindal Global University.