Omar Zakhilwal, Institue for Afghan Studies
The Helmand Valley Project serves to provide an example of the most pervasive development project ever undertaken in modern Afghanistan. In this paper it is argued that the projects’ main aims of kindling an economic development in the one-fourth of the country covered by the project and bolstering the Afghan-US bilateral relationship were both doomed to failure. Perhaps, the latter failure was a direct consequence of the first one. It is concluded that the latter failure, perhaps, was a factor (if not the factor) for pushing Afghanistan a step closer to the USSR’s folder and therefore to the Soviet’s subsequent invasion of Afghanistan.
The Helmand Valley is located in the southwestern portion of Afghanistan and occupies about one-fourth of the total area of the country. Average yearly rainfall in the valley area is about four inches. The valley is in the temperate zone with an elevation varying between 1,500 and 3000 feet. Temperatures range from 18 to 110 degrees Fahrenheit. Humidity is low, and strong dry winds frequently blow in the westerly portion of the valley during July and August. Forty percent of the country's total water resources flows through the valley. The Helmand river is the longest in Afghanistan -- it joins its major tributary, the Arghandab, at Qala Bost, about 350 miles from its source in the Hindu Kush, and continues to the Sistan Basin, another 250 miles. The obstacle towards the agricultural development of the Helmand Valley has not been a shortage of water, but a lack of adequate control of the water in the valley [2].
The Afghans themselves started the first development work in the area in 1910 when part of the vast work of old irrigation canals was reconstructed. They also constructed the first new functional canals by 1914. Foreign technical assistance first arrived in the 1930s when new canals were built with German and Japanese assistance. The Germans gave some technical assistance and the Japanese (1937-1941) helped dig nine miles of canals at Boghra, which was pushed ahead by another 16 miles (1941-1946) by Afghans themselves. During World War II, because of the British-Soviets ultimatum on the Afghan government to expel all Germans, Italian and Japanese personnel, the Helmand project was brought to a halt [1].
In 1945 negotiations began between the Afghan government and an American company, the Morrison-Knudsen on the construction of two diversion dams, one on the Helmand River and the other on its chief tributary, the Arghandab River, enlargement of an irrigation canal and the construction of roads in the Valley. An agreement was reached in 1946 resulting in the formation of Morrison-Knudsen Afghanistan Inc. (MKA) with its headquarters in San Francisco [1,2,3]. The MKA Helmand Valley Project (henceforth called the HVP Project) has been an important turn of event in the history of modern Afghanistan for the following three reasons:
Objectives of the HVP Project included: provision of farms for nomads and land-less villagers; raising the standard of living of peoples in the valley; producing agricultural and manufactured products for export; developing electric power; creating government income which will eventually pay off the investment; providing protection against floods; and providing for early utilization of all waters of the Helmand River except that portion to which Iran was entitled [2].
After a preliminary survey MKA made several estimates: an initial $10.7 million would be needed for all surveys and roads necessary to begin the construction of two dams and an extensive canal system; the total cost would be $63.7 million. The canal system would include intakes, waterways, laterals and sub-laterals. However, "neither the Afghan government nor the American engineering company understood the monumental problems of enfolding an entire region in the embrace of a single project". As Louis Dupree (1980) puts it, "the human problems appear as monumental as the magnificent engineering edifices left on the landscape; but, without consideration of human factor, great dams simply make great ruins" [1].
By 1949 costs had skyrocketed first because under the agreement all equipment had to be shipped from the U.S., half way around the world from the site of the project. Secondly, the equipment had to be sent by rail or track in-transit through a "semi-hostile" Pakistan, which often deliberately hindered shipments to Afghanistan in retaliation for Afghan agitation over the Pushtunistan issue. The Afghan foreign exchange surplus rapidly flowed down into the pocket of Morrison-Knudsen ($20 million by September 1949). In 1949 Abdul Majid Zabuli (the Minister of National Economy) asked the Export-Import Bank (EIB) in Washington D.C. for a $55 million loan. After an initial refusal, the EIB finally approved a $21 million loan. This marked the initiation of the US aid to Afghanistan through which the American government established its stake in the country [1].
As work on the project progressed all of the HVP foreign exchange requirements were obtained from the EIB through the US Technical Assistance Grants. In 1951, The Afghan government asked MKA to take over its engineering obligations, which would require additional funding. In an attempt to unify the efforts, the Afghans created the Helmand Valley Authority (HVA) in July 1952, with the overall responsibility for implementation. In a move to bolster the HVP, its president was given cabinet status [2,3].
With the involvement of EIB and elimination of incentive bonuses to MKA, the MKA initially slowed down its work on the HV Project but soon it realized that the delays were costing them more. It then took several short cuts and rushed toward completion of the two dams and the Boghra Canal system but dropped some projects and curtailed others, among them intensive ground water surveys, certain road pavings and hydroelectric projects. MKA finished the 145-foot-high Arghandab Dam (18 miles from Kandahar) which is 1740 feet long and has a storage capacity of 388,000 acre-feet of water in 1952. In April 1953 the Kajaki Dam (45 miles above Girishk on the Helmand River) 300-feet high and 887 feet long with a 32-mile long reservoir and a capacity of 1,495,000 acre-feet of water was inaugurated [1].
Several contract were subsequently negotiated with the same firm, which included the construction of two storage reservoirs, land development work, irrigation, drainage canals, building roads, etc. The Morrison-Knudsen tenure ended in 1959 with recriminations on both side. The discontent of the Afghan government was made known in October of 1955, at the meeting of the Board of Directors of the International Reconstruction and Development. The finance minister of Afghanistan openly criticized the US for the economic failure in the Helmand valley. Also, in 1959, the president of the Helmand Valley Authority sent a note to the Morrison-Knudsen Company, emphasizing the lack of any fruitful results from the project in spite of all possible efforts by the government of Afghanistan. From 1946 through 1963, total monetary investment in this project is estimated at $150 million, including $60 million or 25% of the total US aid to Afghanistan. Of the Afghan government's total budget expenditures, the Helmand Valley project constituted 19%. Thus the investment was quite large relative to the rest of the economy and its burden was quite heavy upon the meager resources of the country [1,2].
At the end the project was a failure. Of the 539,834 acre of land that was aimed to be irrigated as a result of the project only 170,000 (about 31%) acres actually received adequate water and most of these were already being farmed. Of the several ambitious objectives only the control of floods seemed to have been achieved. There, therefore, is little doubt that the HV project represented a miscalculation on the part of all those involved. They include the Afghans who were behind the project, the Morrison-Knudsen Company and the US government. This despite the warning from numerous sources that the project was doomed to the fate it actually encountered [1,2].
For example the UN Preparatory Mission to Afghanistan suggested in its 1950 report that, "..... the UN headquarters entertained doubts about the economic soundness of the project proposed and the government’s administrative capacity to complete them" [2]. It further added that on the cost-benefit criteria irrigation projects in the north of the country along the Amu Darya were far more promising. The UN was not the only critic of the Helmand project, Abdul Majid Zabuli, Minister of the National Economy until his dismissal in 1950 also opposed the scheme on economic grounds [3]. Similarly, after a survey the US Bureau of Reclamation engineers concluded that because of the need for extraordinary protective installations and the expected annual capital and maintenance cost the HV project would be clearly in excess of annual crop benefits.
Even with respect to non-quantifiable benefits the project fell short of its expectations. As stated above one of the objectives of the project was to settle nomads in the region. After several years of continued effort and enormous subsidies, a large number of nomads left the valley because, after many years of hard work, they could not make a living due to the poor quality of the soil which was not taken into account in the initial survey of the project. Similarly, the project produced very few or no secondary effect, internal or external economies because of its distant location from the population. Thus from the viewpoint of alternative investment opportunities, the project compares unfavorably in terms of increments of national income and implicit benefits. Moreover, the total investment in the HV relative to the rest of the economy was quite large – the actual impact of the investment, therefore, was a slow down in the overall economic growth [2].
Furthermore, more than 50% of the US-educated Afghan graduates and specialists were employed on the project and a good number of these specialists were transferred to it from other sectors in the country. This brain drain from other sectors represented another huge implicit cost of the HV project. In short, the HV project was an indisputable failure on all counts. On the part of the Afghans this failure was interpreted as the negligence and indifference of the US government toward Afghanistan and therefore left the US open to severe criticism by the people and government of Afghanistan and perhaps pushed it a step closer toward the USSR.
References:
[1] Dupree, Louis, Afghanistan, Princeton University Press, Princeton NJ, 1980.
[2] Kamrany, Nake M., Peaceful Competition in Afghanistan: American and Soviet models for economic aid, Communication Service Corporation, Washington DC, 1969.
[3] Maxwell, J. Fry, The Afghan Economy: money, finance and the critical constraints to economic development, Leiden E. J. Brill, 1974.