Business Environment in Afghanistan

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Objectives and Methodology5
Choice of Methodology5
Type of Research5
1.Conditions of Business in Afghanistan7
1.1 Geography7
1.2 People of Afghanistan8
1.3 Political System8
1.3.1 Current Political Situation9
1.4 Current Economic Situation10
1.4.1 Living Conditions11
1.5 Business opportunities in Afghanistan12
1.5.1 Investment Opportunities13
1.6 Agriculture13
1.6.1 Opportunities13
1.6.2 Agriculture Investment Opportunities14
1.6.3 Major Commercial Crops Production and Processing15 1.6.4 Investment in Agriculture Infrastructure16
1.7 Logistics and Transport17
1.8 Opportunities in Mining17
1.9 Oil and Gas Reserves in Afghanistan18
1.10 Energy and Power19
1.11 Investment Opportunity in Housing22
1.12 Telecommunications23
1.13 Afghanistan Carpet Industry23
1.14 How can we develop Afghanistan Economy24
2.Business Supporting Programs26
2.1 Afghanistan’s Business Supporting Program Partners26 2.1.1 USAID (United States Agency for International Development)26 2.1.2 MIGA (Multilateral Investment Guarantee Agency)26 2.1.3 United Nations Development Program27

2.1.4 IntEnt, a bridging program for SME's28
2.1.5 Afghanistan Business Council (ABC)29
2.1.6 World Bank30
2.2 Role of Small and Middle-Sized Enterprises in Afghanistan30 2.2.1 Afghanistan Small and Medium-Sized Enterprise Development Activity (ASMED)30 3.How to set up Business in Afghanistan32

3.1 Applying for Visa and Work Permits32
3.2 Labor32
3.3 Office Space and Industrial Plots33
3.4 Power, Water and Sewage Infrastructure34
3.5 Transports and Logistics34
3.6 Financing and Insurance35
3.7 Types of Taxes Paid while Doing Business36
3.7.1 Taxes and Incentives37
3.7.2 Corporate Income Tax37
3.7.3 Personal Income Tax37
3.7.4 Wage Withholding37
3.7.5 Income Tax for Sole Proprietors37
3.7.6 Withholding Tax on Rental Services38
3.7.7 Business Receipts Tax38
3.7.8 Custom Tariffs38
3.7.9 Repatriating Capital and Profits38
3.7.10 Corruption39
5.1 Suggestions46
5.2 Vision48
5.3 Recommendations49


To understand the business environment can benefit your business in a number of ways. While your business must comply with business environment, there is much to be gained by taking your commitment further. Then there are the wider benefits, such as how your business is perceived. Dealing with business environmental issues can improve your reputation with all your stakeholders’ staff, customers, regulators, investors, your local community and your country. Doing or establishing business in Afghanistan can be very profitable. Even smaller investments can produce more benefits in a short period of time. Watchful analysis of market possibilities and best strategies for business growth or development are highly recommended and available that is the reason I have chosen this topic “Business Environment in Afghanistan” mainly for understanding and explaining the concept of business environment in Afghanistan and to give appropriate information regarding business conditions to the investors. To establish business, enough time should be given on networking to comprehend local business practices and to achieve the proper partners. As well as the strategy of Afghanistan government is to attracting the local and International investors to invest in the country with offering more possibilities in different sectors and fields. I think to explain the conditions of business properly and to put them in practice can help the economy of Afghanistan grow. I have divided my thesis into four main parts those are objectives and methodology, conditions of business in Afghanistan, business supporting program, how to set up business,...
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