There are said to be upwards of 25,000 Taliban fighters active in Afghanistan at present, all of whom need arms, ammunition, food and cash for their families. Add to that the cost of logistical operations, pay-offs, support for the families of dead fighters and you are looking at a substantial annual budget. Even assuming $5 a day to look after a single fighter - a low estimate - that alone comes to more than $46 million a year, before including operational and equipment costs.
Where does all the money come from and how can such huge amounts of cash be moved around the country? There are two major sources - donations from supporters in Afghanistan and abroad, especially the Gulf; and the income from opium, which is 'taxed' by the Taliban.
We can probably add kidnapping, bankrobbery and various other criminal endeavours to the list - as well as the money extorted from trucking companies transporting military equipment for the Coalition forces - but these are small amounts compared to the opium income.
As for the logistics of moving the cash around, some answers are provided in an announcement from the US Department of the Treasury, which, together with the UN, last week designated two hawala businesses and their owners for donating money and providing services to the Taliban.
The Haji Khairullah Haji Sattar Money Exchange (HKHS) and Roshan Money Exchange (RMX), operated by brothers Haji Abdul Sattar Barakzai and Haji Khairullah Barakzai, run a network of hawala traditional money transfer businesses, with offices in several Afghan cities, and in Quetta in Baluchistan, Peshawar, Karachi and Lahore in Pakistan and Iran and Dubai.
According to the US Treasury, Haji Sattar has donated thousands of dollars to the Taliban and transferred funds via his hawala. He and his brother also collected money from Afghan businessmen and transferred it to the Taliban.
Haji Khairullah was a hawaladar for the Taliban senior leadership and also gave them donations. The statement notes:
"As of 2011, HKHS was a preferred method for Taliban leadership to transfer money to Taliban commanders in Afghanistan. In late 2011, the HKHS branch in Lashkar Gah, Helmand Province, Afghanistan was used to send money to the Taliban shadow governor for Helmand Province. In mid-2011, a Taliban commander used an HKHS branch in the Afghanistan-Pakistan border region to fund fighters and operations in Afghanistan. After the Taliban deposited a significant amount of cash monthly with this HKHS branch, Taliban commanders could access the funds from any HKHS branch. Taliban personnel used HKHS in 2010 to transfer money to hawalas in Afghanistan, where operational commanders could access the funds. As of late 2009, the manager of the HKHS branch in Lashkar Gah oversaw the movement of Taliban funds through HKHS."
So it seems that the HKHS money exchange office in Lashkar Gah, the centre of British operations in Helmand, was also the centre of Taliban finance in the region. The same was true of the RMX branch:
"In 2011, a Taliban sub-commander transferred tens of thousands of dollars to a Taliban commander through the RMX branch in Lashkar Gah. The Taliban also sent funds to the RMX branch in Lashkar Gah for distribution to Taliban commanders in 2010. Also in 2010, a Taliban member used RMX to send tens of thousands of dollars to Helmand Province and Herat Province, Afghanistan, on behalf of the Taliban shadow governor of Helmand Province."
RMX was also central to the opium taxation business: "As of 2011, Taliban officials, including the shadow governor of Helmand Province, transferred hundreds of thousands of dollars from an RMX branch in the Afghanistan-Pakistan border region to hawalas in Afghanistan for the purchase of narcotics on behalf of Taliban officials. Also in 2011, a Taliban official directed Taliban commanders in Helmand Province to transfer opium proceeds through RMX."
The Barakzai brothers are unlikely to be too bothered by the US Treasury action, which merely blocks any property they have in the United States and prevents US citizens from engaging in transactions with them. The UN sanctions are a different matter and will hit the business hard. This is a serious blow to the Taliban and will force them to use couriers and other less reliable methods to collect and deliver large amounts of money.