The CIA, Afghan Opium, and Pakistan’s Military Dictatorships

A Dark Alliance

Investigative Report: The covert Afghan war of the 1980s was not only a geopolitical turning point in the Cold War – it also unleashed a flood of heroin onto world markets. A growing body of declassified documents, expert histories, and investigative reports shows that the CIA’s alliance with Afghan mujahideen rebels and Pakistan’s military dictatorship fostered an explosion of opium production and heroin trafficking (The Drug That Makes the Taliban Possible | The Nation) (The Drug That Makes the Taliban Possible | The Nation). By prioritizing the fight against the Soviets over drug enforcement, U.S. intelligence officials turned a blind eye to the narcotics trade that financed their allies. This investigative report examines how CIA operations, in collusion with Pakistan’s authoritarian rulers, transformed Afghanistan and Pakistan into the epicenter of the global heroin trade – with consequences still felt today.

Operation Cyclone and the Opium Boom

In 1979, the Soviet Union invaded Afghanistan, and the United States responded with “Operation Cyclone,” a massive CIA program to fund and arm Afghan resistance fighters via Pakistan’s Inter-Services Intelligence (ISI). Almost immediately, opium cultivation and heroin production in the region surged as the mujahideen financed their insurgency (The Drug That Makes the Taliban Possible | The Nation) (The Drug That Makes the Taliban Possible | The Nation). Heroin laboratories sprouted along the Afghan-Pakistan frontier, turning the lawless borderlands into the world’s largest heroin producer by the mid-1980s (The Drug That Makes the Taliban Possible | The Nation). U.S. officials knew what was happening. A 1986 State Department report bluntly observed that opium was an “ideal crop in a war-torn country” for fast profit, and noted Afghan rebels were trafficking opium to fund weapons purchases (The Drug That Makes the Taliban Possible | The Nation). Nevertheless, the CIA’s covert war proceeded with little regard for the drug trade fueling it. As one U.S. official later admitted, Washington basically “put drugs on the back burner” until the Soviets withdrew in 1988, allowing the opium economy to thrive unchecked (The Drug That Makes the Taliban Possible | The Nation).

The statistics were staggering. Afghan opium production, around 100 tons annually in the 1970s, skyrocketed to about 2,000 tons by 1991 under the CIA’s watch (The Drug That Makes the Taliban Possible | The Nation). By 1984, the Afghan-Pakistani narcotics pipeline was supplying an estimated 60% of the heroin consumed in the United States and 80% of that in Europe (The Drug That Makes the Taliban Possible | The Nation). In 1989, after a decade of CIA-sponsored warfare, Afghanistan and Pakistan had become the world’s first- and second-largest illicit heroin suppliers (The Drug That Makes the Taliban Possible | The Nation). This flood of cheap heroin created a drug epidemic in Pakistan – a country that previously had almost no heroin problem. United Nations observers called the trend “particularly shocking.” The number of Pakistani heroin addicts leapt from virtually zero in 1979 to over one million by the mid-1980s (The Drug That Makes the Taliban Possible | The Nation). Entire villages in the North-West Frontier became addicted, even as refined heroin from local labs poured into Western cities. The Cold War victory against Moscow came at the cost of birthing a narco-state in the Afghan-Pakistan borderlands (The Drug That Makes the Taliban Possible | The Nation).

Pakistan’s Dictatorship: Partner and Enabler

General Mohammad Zia-ul-Haq’s military regime (1977–1988) in Pakistan was the crucial on-the-ground partner for the CIA’s Afghan jihad – and it was deeply complicit in the drug trade that came with it. Zia’s intelligence service, the ISI, served as the middleman to channel billions in CIA funds and arms to the mujahideen, giving the Pakistani generals enormous power and influence (The Drug That Makes the Taliban Possible | The Nation) (The Drug That Makes the Taliban Possible | The Nation). But alongside the flow of weapons, caravans of opium flowed in the opposite direction. Afghan resistance fighters commonly filled trucks (provided for hauling CIA-supplied arms) with opium on the return trip to Pakistan (The Drug That Makes the Taliban Possible | The Nation) (The Drug That Makes the Taliban Possible | The Nation). According to The New York Times, these convoys moved drugs with “the assent of Pakistani or American intelligence officers” who supported the anti-Soviet war (The Drug That Makes the Taliban Possible | The Nation). In other words, at least some U.S. and Pakistani officials knowingly allowed heroin trafficking as a form of covert financing for the resistance.

Inside Pakistan, the drug economy intertwined with the military regime. The remote North-West Frontier Province (NWFP) – a tribal zone beyond easy government control – became a sanctuary for heroin refining. Zia appointed General Fazle Haq as governor of NWFP, a man so closely allied with the CIA that he was dubbed their “close ally” (The Drug That Makes the Taliban Possible | The Nation). Under Gen. Haq’s watch, the province’s Khyber district hosted 100–200 heroin laboratories by the late 1980s (The Drug That Makes the Taliban Possible | The Nation). Further south, in Baluchistan province, Gulbuddin Hekmatyar – the CIA’s favored Afghan warlord – ran half a dozen heroin labs processing opium from Afghanistan’s Helmand Valley (The Drug That Makes the Taliban Possible | The Nation). Pakistani Army trucks from the military’s National Logistics Cell would arrive in these border areas loaded with U.S.-supplied weapons, then depart laden with heroin bound for ports and airports, ensuring the product reached international markets (The Drug That Makes the Taliban Possible | The Nation). In effect, elements of Pakistan’s army and intelligence services turned into narcotics trafficking facilitators, all under the cover of the anti-Communist crusade.

While the Zia dictatorship publicly aligned with Washington’s “War on Drugs,” top Pakistani officials were themselves profiting from the trade. Investigative reports later revealed that opium profits were funneled into major banks like Habib Bank and BCCI, institutions that also handled CIA funds for covert operations (“I Could Live With That”: How the CIA Made Afghanistan Safe for the Opium Trade - CounterPunch.org). The notorious Bank of Credit and Commerce International (BCCI) – later shut down for money laundering – was a repository for drug money from the Afghan heroin trade at the same time it was quietly used by the CIA (“I Could Live With That”: How the CIA Made Afghanistan Safe for the Opium Trade - CounterPunch.org). General Fazle Haq was widely suspected of amassing a fortune through narcotics; in Pakistan, he earned nicknames like “Mr. Fixit” and was rumored to be protecting traffickers. Even Zia-ul-Haq’s closest intelligence chief, Gen. Akhtar Abdur Rahman, was later named in investigations as having had knowledge of drug proceeds funding the war (The Drug That Makes the Taliban Possible | The Nation). In essence, Pakistan’s military regime not only tolerated the drug trade – it was embedded in it, as long as the flow of arms and money served the jihad against the USSR.

Complicity and Cover-Up by U.S. Officials

Throughout the 1980s, evidence of the burgeoning heroin trade linked to the mujahideen and Pakistani officials mounted – but U.S. authorities consistently chose to look away. The Drug Enforcement Administration (DEA) agents posted in Islamabad grew alarmed as heroin syndicates and labs multiplied. By the mid-1980s, the DEA had information on over 40 heroin syndicates and 200+ laboratories operating in Pakistan’s northwest during the Afghan war (“I Could Live With That”: How the CIA Made Afghanistan Safe for the Opium Trade - CounterPunch.org). This explosion of narcotics trafficking was an open secret; yet no major Pakistani drug trafficker was ever busted during that decade (“I Could Live With That”: How the CIA Made Afghanistan Safe for the Opium Trade - CounterPunch.org). One Interpol officer expressed bafflement that the Americans, with all their resources and clout in Pakistan, “failed to break a single case.” The real reason soon emerged: CIA officers in Pakistan explicitly ordered DEA agents to back off any counter-narcotics efforts targeting the Afghan rebel pipeline (“I Could Live With That”: How the CIA Made Afghanistan Safe for the Opium Trade - CounterPunch.org). In the midst of the covert war, stopping drugs was simply not a priority – and U.S. narcs on the ground were told as much.

Multiple investigations and insiders later corroborated that narcotics enforcement was subordinated to Cold War strategy. A declassified CIA intelligence report in 1985 was candidly titled “Afghanistan’s Expanded Opium Trade: Byproduct of War,” acknowledging that the conflict had spurred the drug industry (AFGHANISTAN'S EXPANDED OPIUM TRADE: BYPRODUCT OF WAR). But such admissions never translated into action. In 1990, The Washington Post reported that Gulbuddin Hekmatyar, the CIA’s prime Afghan client, was also the rebels’ leading heroin trafficker (The Drug That Makes the Taliban Possible | The Nation). According to the Post, American officials had long refused to investigate numerous reports of heroin dealing by Hekmatyar or Pakistan’s ISI “because U.S. narcotics policy in Afghanistan has been subordinated to the war against Soviet influence there.” (The Drug That Makes the Taliban Possible | The Nation) In other words, the CIA and White House knew their allies were deeply involved in the drug business but deliberately kept those facts “off the table” to avoid jeopardizing the anti-Soviet mission.

Top-level U.S. officials not only turned a blind eye – at times they actively covered for Pakistan’s drug-tainted regime. A striking example came in May 1984, when Vice President George H.W. Bush (tasked with leading anti-drug efforts) visited Islamabad (“I Could Live With That”: How the CIA Made Afghanistan Safe for the Opium Trade - CounterPunch.org) (“I Could Live With That”: How the CIA Made Afghanistan Safe for the Opium Trade - CounterPunch.org). At the time, Pakistan had become the source of most high-grade heroin in the West, and the Zia regime’s generals were known to be complicit. Bush was fully briefed on this reality (“I Could Live With That”: How the CIA Made Afghanistan Safe for the Opium Trade - CounterPunch.org). Yet during his visit, he publicly praised General Zia’s government for its “unflinching support” in the War on Drugs (“I Could Live With That”: How the CIA Made Afghanistan Safe for the Opium Trade - CounterPunch.org). Privately, Bush pushed the CIA to share more intelligence on drug networks, but the Agency “dragged its feet” and offered little cooperation (“I Could Live With That”: How the CIA Made Afghanistan Safe for the Opium Trade - CounterPunch.org). The episode epitomized U.S. hypocrisy: Washington lauded Pakistan as a partner against drugs, even as the CIA’s partnership with Zia’s dictatorship ensured the heroin trade prospered. No serious pressure was placed on Islamabad to stem narcotics trafficking until well after the Soviet troops had withdrawn.

The long-term ramifications of this complicity were felt both locally and globally. Pakistan’s civilian authorities (when they returned to power after Zia’s death in 1988) inherited a country with powerful narco-cartels and elements of the military enriched by illicit money. Efforts to investigate or prosecute high-level traffickers often hit a wall of establishment cover-ups rooted in the previous decade’s clandestine norms. In Afghanistan, the factions that emerged from the mujahideen – warlords who had grown wealthy from drugs – plunged the country into a brutal civil war in the 1990s, fueled in part by opium profits. The Taliban, who took power in 1996, initially cracked down on opium in an effort to gain international legitimacy, but later they too taxed and traded opium to fund their regime. The legacy of the CIA-sanctioned narcotics boom could not be easily undone.

Fallout and the “Second Act” After 2001

The fallout from the 1980s drug surge continues to haunt the region. By the end of the Soviet-Afghan war, Afghanistan and Pakistan were entrenched as a global narcotics hub, a status quo that outlived the Cold War (The Drug That Makes the Taliban Possible | The Nation). In the 1990s, Pakistan remained a major transit point for Afghan heroin, contributing to crime, corruption, and public health crises (Pakistan became, per some estimates, the most heroin-addicted nation per capita in the world). Afghanistan, for its part, saw opium cultivation ebb and flow with its turmoil: the Taliban’s draconian 2000 opium ban briefly sent production plunging, only for the post-9/11 U.S. intervention to send it soaring again. Notably, the U.S. found itself repeating history – once more allying with warlords (now against the Taliban) and once more downplaying the drug trade. From 2001 to 2006, as Pakistan’s new military ruler General Pervez Musharraf assisted the U.S. war on terror, Afghan opium output skyrocketed from about 185 tons to a record 8,200 tons (The Drug That Makes the Taliban Possible | The Nation). By the mid-2000s, Afghanistan under U.S./NATO occupation was producing over 90% of the world’s heroin. The CIA and Pentagon’s focus on counter-terrorism meant narcotics control was again sidelined, allowing opium to fund insurgents and criminal networks in a grim reprise of the 1980s scenario (The Drug That Makes the Taliban Possible | The Nation) (The Drug That Makes the Taliban Possible | The Nation).

This “second act” of the opium saga under Musharraf underscored a critical point: the structures and precedents set in the 1980s – tolerating drug lords in exchange for strategic gains – had become ingrained. As one history of the period observes, Washington’s military efforts in Afghanistan have repeatedly succeeded only when they aligned with the interests of the opium trade, and faltered when they did not (The Drug That Makes the Taliban Possible | The Nation) (The Drug That Makes the Taliban Possible | The Nation). The CIA’s initial complicity in building up the Golden Crescent drug economy not only undermined the War on Drugs globally; it also seeded long-term instability. The profits from heroin helped empower warlords, extremists, and corrupt power brokers from Kabul to Karachi, complicating governance and peace for decades. In Pakistan, military and intelligence figures learned the lucrative lesson that covert operations and illicit commerce can go hand-in-hand, a lesson that some fear carries into other arenas (from illicit arms to modern proxy wars).

Conclusion: A Well-Documented Legacy of “Blowback”

What began as a Cold War chess move – arming Islamist fighters to bog down the Soviets – mutated into a transnational drug enterprise underwritten by U.S. taxpayers. The CIA’s involvement in the Afghan opium trade (whether through willful ignorance or indirect facilitation) and its alliance with Pakistan’s dictatorial regime left a legacy of “blowback”. This legacy is well-documented through declassified government memos, investigative journalism, and scholarly research: as early as the 1980s, insiders warned that U.S. covert strategy was breeding a narco-trafficking crisis (The Drug That Makes the Taliban Possible | The Nation) (The Drug That Makes the Taliban Possible | The Nation). The warnings went unheeded. The short-term objective of defeating the Soviet Union took precedence over the long-term costs of the heroin flood that ensued. Those costs have been monumental – measured in addicted lives, corrupted institutions, and funded militancy.

Today, Afghanistan remains unstable and awash in opiates, Pakistan continues to struggle with narco-politics, and the world is dealing with the enduring heroin epidemic. The story of the CIA, the Afghan opium boom, and Pakistan’s generals is a cautionary tale of policy calculated in secret, without public accountability. It reveals how quickly the moral imperatives of the War on Drugs were cast aside when they clashed with other strategic goals (The Drug That Makes the Taliban Possible | The Nation). By stripping away euphemisms, the historical record makes one thing clear: the United States, knowingly or not, helped create the very drug problem it would later spend endless resources fighting. This dark alliance of expedience and illegal commerce serves as a stark reminder that covert operations can carry toxic unintended consequences – consequences that span continents and generations (The Drug That Makes the Taliban Possible | The Nation) (The Drug That Makes the Taliban Possible | The Nation).

Sources: Declassified CIA and State Department records; Alfred W. McCoy, The Politics of Heroin and other expert histories; The New York Times and Washington Post archives; investigative reports in The Nation, CounterPunch, and official U.S. congressional inquiries (The Drug That Makes the Taliban Possible | The Nation) (The Drug That Makes the Taliban Possible | The Nation) (“I Could Live With That”: How the CIA Made Afghanistan Safe for the Opium Trade - CounterPunch.org) (The Drug That Makes the Taliban Possible | The Nation).