World Bank suspends aid to Afghanistan after Taliban takeover

The World Bank has announced the suspension of aid to Afghanistan, following the Taliban's swift takeover of the country. 

The World Bank said that it is "deeply concerned" by the situation in Afghanistan and the impact on the country's development prospect, especially regarding women's rights.

The World Bank spokesperson stated that the bank has paused disbursements in its operations in Afghanistan and are closely monitoring and assessing the situation in line with its internal policies and procedures.

The spokesperson added saying that the World Bank will continue to consult closely with the international community and development partners and explore ways to remain engaged to preserve hard-won development gains and continue to support the people of Afghanistan.

The World Bank has provided almost $5.3 billion to Afghanistan since 2002, mostly in grants. It also has over two dozen ongoing development projects in the country. 

World Bank evacuates Kabul-based team

The World Bank has pulled out all its staff and their immediate families from Afghanistan. The Kabul-based team of the World Bank was safely evacuated to Pakistan on August 20, 2021, as per sources.

Significance

•The World Bank's move of freezing aid to Afghanistan comes less than a week after the International Monetary Fund paused payments to Afghanistan.

•The International Monetary Fund (IMF) has suspended operations with Afghanistan, including an existing $370 million loan program and $340 million that Kabul was due to receive from the release of Special Drawing Rights (SDR), the lender's basket of currencies.

•The United States also froze billions of dollars worth of assets from American accounts held in Afghanistan's central bank. The US also announced that it will deny the Taliban access to the country's gold and cash reserves, most of which is held overseas.

Background

The suspension of funds follows the Taliban's forceful takeover of Afghanistan in the wake of the withdrawal of US and NATO troops from the country.