Tuesday 17 November 2009
Kabul, Afghanistan -- Every morning, dozens of trucks laden with diesel from
Some of the trucks are on their way to two power stations in the northern part of the capital: a recently refurbished, if inefficient, plant that has served Kabul for a little more than a quarter of a century, and a brand new facility scheduled for completion next year and built with money from the U.S. Agency for International Development (USAID).
Afghan political analysts observe that Ghazanfar and Zahid Walid are striking examples of the multimillion-dollar business conglomerates, financed by American as well as Afghan tax dollars and connected to powerful political figures, that have, since the fall of the Taliban in 2001, emerged as part of a pervasive culture of corruption here. Nasrullah Stanikzai, a professor of law and political science at Kabul University, says of the companies in the pocket of the vice-president: "Everybody knows who is Ghazanfar. Everybody knows who is Zahid Walid. The [government elite] directly or indirectly have companies, licenses, and sign contracts. But corruption is not confined just to the Afghans. The international community bears a share of this blame."
Indeed, the tale of the "reconstruction" of
The Rise of a Power Broker
Abdul Hasin and his brother, the vice-president, offer a perfect exemplar of the new business elite. The two men are half-brothers, born to the two wives of a well-respected religious cleric from the
In the early 1980s, Fahim, the older brother, joined the mujahedeen forces of Ahmed Shah Massoud in the struggle against the Soviet occupation of
A number of popular accounts of that invasion, such as Bob Woodward's book Bush at War, suggest that the Central Intelligence Agency directly gave Northern Alliance warlords like Fahim millions of dollars in cold, hard cash to help fight the Taliban in the run-up to the
Once the Taliban was defeated, Fahim was invited to become vice president in the transitional government led by Hamid Karzai, a position he held for two years. It was at this juncture that Fahim's brothers, notably Abdul Hasin, started to build a business empire -- and not long after, good fortune began to rain down on the family in the form of lucrative "reconstruction" contracts.
In January 2002, while Fahim took whirlwind tours of
On a plot of land in downtown
In the winter of 2006, Zahid Walid won a $12 million dollar contract from the Afghan ministry of energy and water to supply fuel to the old diesel plant in northwest
On October 19th, I visited Zahid Walid's heavily guarded headquarters in the wealthy
Most senior Afghan government officials and political figures are loath to discuss how Zahid Walid has won all these contracts -- at least publicly. On a recent visit to the Ministry of Commerce, I asked Noor Mohammed Wafa, the general director of oil products and liquid gas, about them. He promptly claimed that he had never even heard of the company. He then shot a glance at my Afghan assistant and said in Dari: "That's Marshal Fahim's company, isn't it?" When I asked whether the rules were different for powerful political figures -- as everyone in
In fact, dozens of people assured me in private on my most recent visit to
A White Elephant Power Plant in
While Zahid Walid has won close to $100 million in diesel contracts from the Afghan government in these years, there is hard evidence that the money for this once-needed fuel is now essentially being squandered. Earlier this year, KEC, an Indian company, completed the first of two high voltage power lines from neighboring Central Asian countries that will bring cheap and reliable electricity into the capital.
The initial 220 kilovolt power line from
To add insult to injury, much of the diesel is meant for the USAID power plant at Tarakhil that has become a symbol of the sort of massive and widespread reconstruction waste and abuse that has gone on in this country for years. The plant, built by Black & Veatch, is now projected to cost $300 million, three times the price of similar plants in neighboring
"At full capacity, we burn 600,000 liters a day," Jack Currie, the Scottish manager of the Tarakhil plant told me as I toured it in late October. "And just how much will that cost the Afghan taxpayer?" I asked. "Well," replied Currie, "you can assume a dollar a liter of diesel." I quickly calculated and arrived at an annual total of $219 million per year, not including the plant's maintenance costs (estimated at another $60 million a year). Currie looked astonished when I mentioned the figure.
I took these numbers to Mohammed Khan, a member of the Afghan parliament and chair of its energy committee. "Will you approve the funds for this diesel power plant?" I asked. The soft-spoken Khan, a trained electrical engineer who worked for many years in the Kabul Electricity Department, answered simply: "No. Not unless we have an emergency."
So why build a power plant that, in terms of kilowatt hours made available, costs 26 times as much as the Indian-built power line? Anwar-ul-Haq Ahadi, Afghan's former finance minister, recalls the process. The idea, he says, originally came from then-U.S. Ambassador to
Following up, USAID officials told the Karzai government that they could build a diesel plant in
Over the next two years, while Indian engineers raced the Americans to provide power to Kabul (ultimately winning handily), the ministry of energy and water was having a hard time keeping the lights on during Kabul's harsh winters. And while the city waited for these promised sources of power to come on line, the new political-business elite, with its specially set up companies like Zahid Walid, was winning government-issued contracts to supply diesel to the old Kabul power plant -- and making money hand over fist.
Zahid Walid was hardly the only politically well-connected business to clean up: Ghazanfar, a company from Mazar-i-Sharif, also won $17 million in diesel-supply contracts in the winter of 2006-2007, and then an astonishing $78 million in new contracts for 2008-early 2009. Not surprisingly, Ghazanfar turns out to be run by a family that is very close to President Karzai. (One sister, Hosn Banu Ghazanfar, is the women's minister and a brother is a member of parliament.)
In March 2009, the Ghazanfars opened a new bank in the capital, plastering the city with giant billboard advertisements featuring a cascade of gold coins. Less than six months later, the bank wrote out a two million dollar interest-free loan to Karzai for his election campaign, paying back the favors his government had done for them over the previous three years.
This week, Mohammed Qasim Fahim will be sworn in as the next vice-president of the new government of
Hamid Jalil, the aid coordinator for the Ministry of Finance, points out that wasting money on unnecessary projects like Tarakhil has helped to hobble
Former Afghan finance minister Ashraf Ghani summed up the whole profitably corrupt system that has run
Pratap Chatterjee is an investigative journalist and senior editor at CorpWatch. He is the author of Halliburton's Army: How A Well-Connected Texas Oil Company Revolutionized the Way America Makes War (Nation Books, 2009) and Iraq, Inc. (Seven Stories Press, 2004).
Dr Ali Safi contributed research and reporting for this article. A video story by Chatterjee related to this one can be seen at Britain's Channel 4 News
Pratap Chatterjee is an investigative journalist and senior editor at CorpWatch. He is the author of Halliburton's Army: How A Well-Connected Texas Oil Company Revolutionized the Way
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