ply. Similarly, official data supplied by the Kabul regime to
international agencies were no more reliable than data produced
by its Soviet patron. It is clear, however, that Afghanistan faced a
deteriorating balance of payments, as its exports fell and its
imports rose. In 1980 Afghanistan had a trade deficit of US$69
million (or 9.8 per cent of exports). By 1990 this had risen to
US$649 million (or 276.2 per cent of exports). As might have
been expected, foreign debt also increased, from US$1.2 billion in
1980 to US$5.1 billion in 1990. Finally, Afghanistan suffered
significant inflation: prices during the decade of the 1980s
increased by 980 per cent (Marsden and Samman, 2001: 39–41).
Such developments are not purely of abstract interest. If price
rises are not matched by rises in income, the ability of individuals
and families to maintain their living standards is compromised.
Similarly, if the external value of the currency falls – a common
result of an intractable payments deficit – prices of imported
goods will rise, again affecting living standards.
Afghan politics
Finally, some remarks about the effects of the war on Afghan pol-
itics are in order. First, the Afghan state at the time of the Soviet
withdrawal had lost its capacity to function with any significant
degree of autonomy. By 1988, fully 84 per cent of government
expenditure was routine rather than developmental, in contrast to
the situation in 1978 when 53 per cent of expenditure was on
development. Less than a quarter of government expenditure was
funded by domestic revenue; more than three-quarters was funded
by rentier income (foreign aid and sales of natural gas) and by
domestic borrowing (Rubin, 1995a: 297). In practice, this amount-
ed to a disguised form of state collapse, since domestic revenue
fell far short of what was required even to cover ordinary state
expenditure. If and when the state’s financial life-support machine
was disconnected, a crisis was unavoidable.
Second, the tools of politics were altered by the war. Politics
had to a limited extent been institutionalised during the New
Consequences of the Soviet–Afghan War 157