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This is an audio transcript of the FT News Briefing podcast episode: Chaotic scenes at Kabul airport, Pakistan’s dollar bonds fall

Lauren Fedor
Good morning from the Financial Times, today is Tuesday, August 17th, and this is your FT news briefing.

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There were frantic scenes at Kabul’s airport as panicked Afghans tried to flee Taliban rule. Now fears are growing about a possible new refugee crisis. Plus, the Taliban has evolved since the US first invaded back in 2001. We’ll talk about how the new regime might rule.

Stephanie Findlay
The Taliban have made assurances that they will respect the rights of women. However, how that is in practice remains to be seen. And right now, we have heard reports of girls being told to put on the burqa or turned away from school or turned away from work.

Lauren Fedor
I’m Lauren Fedor, in for Marc Filippino. And here’s the news you need to start your day.

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There was chaos at the international airport in Kabul yesterday, and US military officials suspended flights after the airport was overrun by desperate Afghans trying to flee. Videos show people falling to their death after clinging to the wheels of planes that were taking off. Many Afghans, particularly women, are panicking about life under the Taliban. Also yesterday, US president Joe Biden made his first comments since the Taliban took control of Kabul. He blamed the Afghan government and military forces there for the swift defeat. He said he stood by his decision to withdraw US troops.

Joe Biden
I stand squarely behind my decision. After 20 years, I’ve learnt the hard way. That there was never a good time to withdraw US forces. That’s why we’re still there. We were clear eyed about the risk. We plan for every contingency, but I always promised the American people that I would be straight with you. The truth is, this did unfold more quickly than we had anticipated.

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Lauren Fedor
The Taliban victory could also lead to a refugee crisis. If it’s any indication international bonds issued by two of Afghanistan’s neighbours have already come under pressure. There was a one percent drop in the price of Pakistan’s dollar bonds. Investors also sold off Uzbekistan’s debt.

Tommy Stubbington
Just to put that into context, this isn’t something that the market just woke up to this week. There’s been a kind of a gradual decline over recent weeks and months as investors get more concerned about the potential fallout for Pakistan and also for other neighbouring countries, Uzbekistan being the main one at this point.

Lauren Fedor
That’s the capital markets correspondent Tommy Stubbington.

Tommy Stubbington
First, and most obviously is the possibility that you get a huge exodus of refugees across the border into Pakistan and also north into Uzbekistan that could put a strain on the finances of these governments. And at the margin, if you’re an investor, you’re thinking, well, you know, that makes the credit worthiness of those governments, the clients. So really, they’re kind of coldly calculating that the instability that spreads from the Afghan crisis is bad news for those countries’ finances. The other thing is the possibility that there’s some form of international backlash against Pakistan in particular for its perceived role in harbouring the Taliban. You know, the idea that the Pakistani intelligence services have been lenient towards Taliban fighters and possibly even, you know, actively encouraged them in their war against the Afghan government. And I suppose investors really are speculating at this point, could there be some form of sanctions against Pakistan by the US or by the EU? Potentially, possibly that wouldn’t take the form of sanctions, but something kind of softer, like the withholding of aid. So, again, those could both be things that put a strain on Pakistan’s government finances.

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Lauren Fedor
With the Taliban now in control, one question we’re asking is how exactly they’re going to rule. The FT’s Stephanie Findlay has been talking to researchers about what a Taliban government might look like. She joins me now. Steph, what kind of government do you think the Taliban is setting up?

Stephanie Findlay
Through their whole negotiations with the US, first under President Trump and later under President Biden they’ve been very clear that they want to re-establish an Islamic emirate of Afghanistan and that they do not want to have a vote. They do not believe in democracy. And we expect to see a stricter style of Sharia law and a more fundamentalist approach to governance in the country that is more tightly tied to theology and religion.

Lauren Fedor
Is there any sign that they might be less severe, for example, in the way that they’ve treated women in the past?

Stephanie Findlay
The Taliban have made assurances over these months of negotiations that they will respect the rights of women, that girls will be allowed to go to school. However, how that is in practice remains to be seen. And right now we have heard reports from cities where they’ve taken over in Herat, for example, of girls being told to put on the burqa or turned away from school or turned away from work. However, the picture is not yet very clear at the moment. So we’ll be waiting to hear more details coming out from these places about what it’s actually like on the ground.

Lauren Fedor
How united are the Taliban leaders, are there different political factions?

Stephanie Findlay
Within the Taliban there are definitely different factions. There are those who were pushing for a deal with the US. There have been those in the past who have pushed for a deal with the Kabul government. Right now, it does look like they are unified under a central command. But again, there are just so many unknowns what that will look like when they come into power, when they make a government, when they start making decisions about how to deal with regional powers, that remains to be seen. But I think people are feeling like the Taliban right now are coherent. They’ve been coherent in their strategy to overthrow and oust America, the so-called crusader. And that has ultimately been a very powerful, unifying force.

Lauren Fedor
So the Taliban has already controlled parts of the country in recent months. Does that give us any impression or indication of how they might govern the whole country?

Stephanie Findlay
Researchers who are studying the Taliban economy point out that in many areas, business is more efficient under Taliban control, while as those under government controlled areas, there’s much more corruption. So there will be many more checkpoints where people have to pay taxes where under a Taliban controlled area, they don’t have to pay as many taxes and business is allowed to flow more smoothly. So even as they were doing their offensives, the Taliban were quite sensitive to keeping business open in a way that benefited them and kept traders and business people on their side as they were taking over these areas.

Lauren Fedor
And where are they getting their money? How are they going to fund this government?

Stephanie Findlay
So Taliban fighters are coming into Kabul with significant resources. I think this image of them as these opium drug lords, while it’s true to a certain extent, for years now, researchers say that the group’s income from poppy cultivation and the drug trade has been dwarfed by revenue from taxing transit goods and fuel. And this is a reflection of their growing administrative power. And it’s also significant because it drastically reduces their need for humanitarian aid. I mean, Afghanistan is extremely dependent on foreign aid. However, the growing sophistication of the Taliban economy shows that there are more ways for them to earn money. I mean, during this offensive, they captured key border posts and the regional countries kept on trading. So that was a huge source of revenue for the Kabul government. And it will also be a huge source of revenue for the Taliban government. So we’re looking at a kind of more conventional state player with more conventional sources of funding.

Lauren Fedor
That’s the FT’s Stephanie Findlay.

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You can read more on all of these stories at FT.com. This has been your daily FT news briefing. Make sure you check back tomorrow for the latest business news.

This transcript has been automatically generated. If by any chance there is an error please send the details for a correction to: typo@ft.com. We will do our best to make the amendment as soon as possible.

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