Abstract

As this report shows the evidence from the centre of Baharak district in Badakhshan is that given the right conditions many households can prosper despite ceasing or significantly reducing opium poppy cultivation. Opium poppy remains an input intensive crop. Not only does land have to be set aside for its cultivation but also water, seed, farm power and most importantly of all labour. When the opportunity cost of allocating these inputs to opium production rise due to the growth in the market for high value vegetable production, the recovery of livestock prices and significant increases in wage labour opportunities, households can make the shift from opium poppy cultivation to legal economic opportunities without enduring economic and political shocks.

For instance, it no longer looks as economically attractive to allocate family members to work on such a labour intensive crop as opium poppy cultivation when salaried employment and consistent wage labour opportunities are available, particularly when opium prices are falling. Neither does it make sense to hire a workforce for opium poppy cultivation to substitute for this now gainfully employed family labour given relatively high wage labour rates.

Instead it is rational to cultivate less labour intensive crops th at can be managed largely utilising the remaining supply of household labour. Of course it is even more conducive to the household if these crops fetch good prices, attract traders to purchase them at the farmgate and obtain advance payments, as is currently the case in central Baharak. Land can also be allocated to fodder crops that are again less labour intensive and serve to increase the value added of livestock which has seen a recovery in prices and market size.

As such, combining wage labour opportunities with high value cash crops and livestock production not only has the potential to generate a higher return to household resources but can also offer greater security than simply cultivating opium poppy. Of course in this scenario ‘security’ is not only a function of the different income streams available which act as a safety net against crop or market failure, but also a consequence of the household operating within the ‘rule of law’ and therefore less vulnerable to the potential excesses of both state and non-state actors. In this situation a household will also more often than not be a recipient of public goods such as education, health, physical infrastructure, as well as physical security which all serve to improve economic opportunities and extend social contract between the state and community. As experience in othe r former opium poppy growing areas in countries like Thailand and Pakistan illustrate once these gains are consolidated farmers are unlikely to return to opium production even when famgate prices increase significantly.

However, this paper also shows that the opportunity cost of allocating household resources to opium poppy is not rising for a ll, indeed these development are typically highly localised and concentrated around central Baharak. In contrast in the more remote areas of Baharak district and across much of the ne ighbouring district of Jurm, circumstances are such that agricultural commodity and labour markets remain constrained. Limited natural assets, such as land and water, combined with poor roads and high transportation costs preclude the shift to high value vegetable production. Some recovery in livestock is taking place but the benefits of this tend to be concentrated amongst the relatively wealthy who have often restocked their herds using the proceeds from their opium crop. In these areas opium poppy persists all be it at lower levels than in 2006.

In the more remote parts of the district of Baharak there is potential for opium to cease once infrastructure is improved, and more marginal households restock their herds and gain better access to labour markets through a growth in labour demand and/or skill development. Wage labour opportunities in Iran will continue to be seen as an important safety valve for households who cannot meet their basic needs by participating in local agricultural and labour markets.

In the district of Jurm the prognosis is more bleak. The biggest constraint on reducing opium poppy in this area is the insecurity and poor governance that is currently stymieing the growth of the legal economy. Here the political and financial interests of competing commanders will only serve to continue high leve ls of dependency on opium production and prevent households making sustainable shifts to legal economic options. There is a danger that the growing insecurity in the centre of the district has a knock on effect in the upper areas in which currently the local commanders remain relatively inactive.

In the centre of Jurm the uncertain political and security environment is already impacting on investment decisions. Attempts by the local and central authorities to reduce opium poppy cultivation are viewed with disdain and seen as part of a wider attempt by local commanders to reinforce their political and economic grip over the area. It is also impacting on the legal economy reducing disposable income and subsequently sales and employment opportunities. This in turn is further weakening the relationship between the state and local communities.

As such there is a real risk that the political need for short-term results on levels of cultivation could undermine attempts to de liver sustainable development and counter narcotics outcomes. In such an environment greater focus needs to be given to stabilising the security and governance environment thr ough anti corruption measures and extending service delivery, as well as promoting economic growth. It would appear that counter narcotics efforts such as eradication efforts may well have to wait until these pre-requisites are put in place and farmers have viable alternatives to opium poppy cultivation.