From Tehran to Kabul: How Iran’s Domestic Situation Shapes Afghanistan’s Future

Natasha Matloob

Research Assistant, Oxford Global Society | Mphil Strategic Studies, National Defense University, Islamabad, Pakistan

Yummna Hina Khan

Contributing Writer, The Stimson Center | Security Studies Researcher

Introduction

Iran is going through one of the most consequential and sensitive periods of domestic and external pressure it has experienced in recent years. What initially emerged as sustained domestic unrest, rooted in economic hardship, has intersected with a direct military confrontation involving the United States and Israel. The result is a rapidly evolving regional security environment whose consequences extend far beyond Iran’s borders. For Afghanistan in particular, the stakes are exceptionally high. The two countries share a 921-kilometre border, extensive trade interdependence, religious and linguistic ties, and decades of intertwined migration flows. Historically, major political developments in Iran have rarely remained confined within its own borders. Instead, they have reverberated across Afghanistan’s domestic stability, ideological debates, and regional alignments. This note therefore examines how Iran’s domestic situation, now further complicated by escalating inter-state tensions, may affect Afghanistan across economic, security, demographic, and ideological dimensions. Rather than attempting to predict Iran’s overall trajectory, it focuses on likely pathways of instability and the possible spillover effects they may generate for Afghanistan.

Domestic Pressure in Iran: Polarization and Escalation

Since late 2025, Iran has faced renewed waves of unrest arising from persistent inflation, the depreciation of the national currency, declining purchasing power, and broader dissatisfaction with deteriorating social conditions (Al Jazeera, 2025). Inflation has remained above 40 percent, Iran’s national currency has undergone severe depreciation, and sanctions have continued to restrict the country’s financial and energy sectors (Avcioglu, 2026). Protests and unrest took place in several urban centres and were accompanied by security responses and restrictions on communication networks.

The domestic atmosphere has also been shaped by deepening political polarization and mounting pressure within elite circles. At the same time, diplomatic engagement between Tehran and Washington over Iran’s nuclear programme failed to produce tangible results, further increasing the risk of strategic miscalculation. That risk materialized dramatically on 28 February, when the United States announced the launch of what it described as “Operation Epic Fury” against Iran’s missile and nuclear infrastructure (Adler et al., 2026). Donald Trump, the President of the United States, presented the operation as necessary to eliminate imminent threats. Shortly before this announcement, Israel confirmed that it had carried out “pre-emptive strikes” against Iranian targets; an action that Benjamin Netanyahu, the Prime Minister of Israel, described as necessary to address existential security concerns.

Iran responded by launching missiles toward Israeli territory and by targeting facilities associated with the United States in the Persian Gulf region, including facilities linked to the Fifth Fleet in Bahrain. Explosions were reported in Tehran and other cities, Iranian airspace was temporarily closed, the Supreme Leader and a number of senior Iranian officials were assassinated, and the confrontation dragged on for approximately forty exhausting days.

Although these hostilities are considered to have ended by the time of writing this report in late June 2026, the developments transformed Iran’s crisis from primarily domestic political turmoil into a direct inter-state confrontation with the potential to escalate into a wider regional war. For Afghanistan, which is itself grappling with persistent cross-border hostilities with Pakistan, this shift has significantly altered Kabul’s strategic calculations, particularly with regard to border security, trade routes, and external alignments.

Economic Interdependence and the Transmission of Shock to Afghanistan

Iran has long been, and remains, one of Afghanistan’s most important economic partners. Despite sanctions, bilateral trade in 2025 reached approximately USD 3.366 billion (Zazai, 2025). This relationship is structural in nature. Iran supplies a significant share of Afghanistan’s fuel, liquefied gas, electricity for western provinces such as Herat, wheat flour, cement, and construction materials (Shayan, 2025). Chabahar Port provides Afghanistan with maritime access, partly compensating for the country’s reliance on transit routes through Pakistan (Farooq, 2019). For a landlocked and import-dependent economy, these corridors function as vital arteries.

The security situation between February and June 2026, which included attacks by the United States and Israel against Iranian targets and Iran’s response through missile strikes toward Israel and American facilities in various Persian Gulf states and, of course, Jordan, created immediate risks of economic shock. Even a limited conflict can disrupt fuel exports, overland transport through key border crossings such as Islam Qala, and the financing of regional trade—let alone the broader regional conflict that the Middle East experienced. Higher insurance premiums for shipping in the Persian Gulf, or the temporary closure of transit routes, directly affected Afghanistan’s imports of fuel and essential goods and was quickly transmitted into transport and food inflation.

Financial interdependence creates additional vulnerability. Due to existing sanctions, a large portion of Afghanistan–Iran trade relies on informal settlement channels. As conflict and sanctions intensified, transaction costs increased, liquidity became more constrained, and remittance flows from Afghan workers in Iran may have declined; a development that would further intensify domestic economic pressure.

Conversely, if escalation gives way to de-escalation through negotiation and the partial easing of sanctions, Iran’s reintegration into formal banking systems and energy markets could expand trade and improve transit efficiency. Afghan traders may benefit from lower transaction costs and more reliable logistics. However, such gains would depend on Afghanistan’s own level of financial connectivity; continued financial isolation would limit the benefits that Afghanistan could derive from any opening in Iran’s economic position.

Afghanistan’s vulnerability is therefore structural rather than ideological. Its dependence on Iran for energy and transit access means that developments in the ongoing confrontation among the United States, Israel, and Iran—whether contractionary through conflict or expansionary through diplomatic recalibration—are likely to reverberate rapidly across Afghanistan’s fragile economic system.

Migration Pressures and Humanitarian Risk

Iran currently hosts between 3.4 and 3.6 million Afghans, according to official figures, including registered refugees and undocumented migrants (UNHCR, 2024). Remittances sent by Afghan workers also constitute an informal but important support network for families across western and central Afghanistan. Even before the escalation of the current tensions, Iran had begun large-scale deportations of undocumented Afghan migrants. As the conflict intensified, a combination of economic contraction, tighter security measures, disruption in the labour market, and fear-driven departures somewhat accelerated outward movement. In the medium term, this may impose greater financial and social pressure on Afghanistan’s governance structures, which are already struggling with high unemployment, limited public services, and constrained human capacity. Secondary displacement may also occur, as Afghans unable to remain in Iran may seek alternative migration routes toward the West, thereby intensifying irregular flows toward Turkey and Europe. Population displacement is therefore one of the most immediate channels through which instability in Iran may affect Afghanistan.

Security Realignment and the Calculations of Armed Groups

Iran has long played a dual role in Afghanistan’s security environment. On the one hand, it has acted as a counterweight to Sunni extremist networks such as the Islamic State Khorasan Province. On the other hand, it has maintained pragmatic engagement with the authorities in Kabul. Tehran has historically cultivated ties with Shiʿa communities in western Afghanistan, particularly among the Hazara population, which constitutes approximately 15 to 20 percent of the country’s population and faced severe persecution and repression during Taliban rule from 1996 to 2001 (Minority Rights Group, n.d.). Through a combination of political engagement, security coordination, and informal militia networks, Iran has sought to preserve its influence while monitoring transnational actors capable of destabilizing the region. This balancing strategy has helped produce a fragile but functional security equilibrium along the 921-kilometre Iran–Afghanistan border.

The recent military confrontation, marked by U.S. and Israeli attacks on Iranian facilities and Iran’s missile response toward Israeli territory and U.S.-linked facilities in several Persian Gulf states, creates immediate and multilayered risks for Afghanistan. If Iranian security forces are further redirected toward domestic stabilization or external defence priorities, monitoring capacity along key crossings such as Islam Qala, Herat, and Nimroz could decline. Reduced oversight of these corridors may create exploitable space for transnational armed actors, including elements linked to al-Qaeda and smuggling networks, which have previously used western transit routes.

The structural consequences extend beyond border management. During the period from 2001 to 2021, fluctuations in the degree of Iran’s engagement and presence in western Afghanistan coincided with changes in the activity of armed groups in border provinces. If Tehran once again becomes strategically distracted, Afghanistan may face cumulative pressures: weakened border surveillance, intensified manoeuvring by armed groups, and the recalibration of regional power alignments. For Taliban-led authorities, whose model of governance relies largely on centralized ideological cohesion and security control, such pressures could limit operational flexibility and complicate the management of domestic threats.

The Ideological and Symbolic Consequences of Iran’s Turmoil for Afghanistan

Iran’s 1979 Revolution profoundly transformed ideological discourse across the Islamic world, including Afghanistan (Ansari & Aarabi, 2019). Themes such as clerical authority, anti-imperialist resistance, and political Islam resonated strongly among Afghan resistance movements in the 1980s, providing both a model for Islamist mobilization under foreign occupation and a source of legitimacy. This influence was transmitted not through direct intervention alone, but through transnational networks, religious institutions, and shared Persian-speaking communities, especially among the Hazara population.

The contemporary context, however, is markedly different. Current political debates in Iran focus less on political mobilization and more on governance performance, economic sustainability, and institutional accountability. If domestic conflict leads to reform or strategic recalibration, the consequences may shape regional narratives about viable models of governance within Islamic frameworks. For Afghan authorities, whose legitimacy still rests heavily on ideological cohesion, such comparative perceptions matter. A politically stabilized and economically reintegrated Iran could project an image of resilience and effective statecraft under pressure; an image that could potentially challenge Taliban claims of ideological and administrative competence. Conversely, visible pressure or institutional incapacity in Iran could reinforce regional doubts about Islamic models of governance and provide indirect lessons for Afghan policymakers and political actors.

It is nevertheless essential to avoid deterministic assumptions. External military pressure, including the ongoing escalation among the United States, Israel, and Iran, does not automatically weaken domestic structures. In some cases, it may consolidate political cohesion and strengthen bargaining among elites. Political durability continues to depend on internal cohesion, coercive capacity, and institutional legitimacy; factors that are only partly shaped by external shocks. From this perspective, the symbolic and ideological effects of Iran’s instability on Afghanistan are complex, conditional, and mediated through perceptions and structural realities, rather than directly causal.

Afghanistan at the Crossroads of Regional Turmoil

Alongside developments in Iran, tensions along the Pakistan–Afghanistan border intensified and led to heavy cross-border exchanges of fire and retaliatory attacks in late February 2026, with another exchange of fire also occurring amid the fragile ceasefire between Iran and the United States. Islamabad had previously announced Operation “Ghazab al-Haq” and carried out targeted attacks inside Afghan territory against what it described as the infrastructure of armed groups, while Kabul condemned these actions as violations of sovereignty (Phillips et al., 2026).

The interaction between these conflicts and broader regional instability highlights the interconnected nature of Afghanistan’s vulnerability. Turmoil in Iran, combined with persistent friction between Pakistan and Afghanistan, multiplies Afghanistan’s exposure to risk and reduces the predictability of security outcomes. Under conditions of cumulative pressure, Kabul’s capacity to manage its borders may become even more constrained. Governance limitations, internal factional dynamics, and the absence of formal regional security frameworks further narrow the strategic room for manoeuvre available to Taliban authorities.

Although Taliban-led authorities may retain internal territorial control, their resilience will be tested across several fronts: economic pressure, the possible arrival of refugee waves, security realignment, and shifting geopolitical alignments. Kabul’s capacity to manage these overlapping pressures will shape not only Afghanistan’s domestic stability, but also the broader regional balance. In a landscape defined by porous borders and intertwined crises, Afghanistan’s future trajectory remains inseparable from developments in neighbouring countries, especially Iran, and from the evolving architecture of regional power competition.

Conclusion

Overall, the significance of developments in Iran for Afghanistan is not limited to geographical proximity or historical commonalities. Rather, it lies in the degree of Afghanistan’s structural dependence on Iran’s stability. Afghanistan is positioned in such a way that any crisis in Iran may be transmitted to it simultaneously through several economic, migratory, security, and symbolic channels, thereby placing pressure on Kabul’s limited governance capacity. Under these conditions, the central issue for Afghanistan is not choosing between alignment with Iran or distancing itself from Iran, but managing the inevitable consequences of instability in its surrounding environment. The simultaneity of Iran’s crisis with Pakistan–Afghanistan border tensions also demonstrates that Kabul is facing a multilayered and unpredictable security environment. From this perspective, Afghanistan’s future will depend more than before on its ability to preserve strategic flexibility, diversify economic routes, and prevent external pressures from turning into domestic crises. Developments in Iran may therefore constitute both an immediate threat and a strategic test for Afghanistan; a test that will reveal the extent to which the existing political structure in Kabul can manage intertwined regional crises.

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