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Edition: U.S. Article Comments (1) Email Print Reprints Full Focus Editor's choice A selection of our best photos from the past 24 hours. Full Article Read U.S.-South Korea aircraft carrier drill called off: report 24 Oct 2010 BP CEO slams media, rivals for boosting spill fears 9:49am EDT Wall St rises on dollar weakness, Fed stimulus talk | 11:28am EDT Bank of America finds foreclosure mistakes: report 8:53am EDT US STOCKS-Futures rise as dollar falls after G20 7:22am EDT Discussed 65 Jobs blasts rivals as iPad sales disappoint 54 Special Report: The haves, the have-nots and the dreamless dead 47 Special report: Conservative donors let Christine O’Donnell sink Watched Katy Perry weds; Damon a dad Sun, Oct 24 2010 Mexico's 20-yr old police chief Thu, Oct 21 2010 Russian spy poses for Maxim Tue, Oct 19 2010 Karzai says his office gets "bags of money" from Iran Tweet This Share on LinkedIn Share on Facebook Factbox Factbox: Incidents stirring U.S.-Afghan tensions Wed, Oct 20 2010 Related News Ousted Afghan governor warns of Iranian influence 12:57am EDT Afghan leader sees hope for peace, reconciliation Wed, Oct 20 2010 Pakistan says willing to assist Afghan talks Fri, Oct 15 2010 NATO helped bring Taliban official to Kabul: Petraeus Fri, Oct 15 2010 Analysis & Opinion Too many butchers spoil the cow Gen Petraeus turns up the heat on Pakistan, Afghanistan Related Topics World » Afghanistan » Earnings » Afghanistan's President Hamid Karzai (L) welcomes his Iranian counterpart Mahmoud Ahmadinejad in Kabul March 10, 2010. Credit: Reuters/Sorkhabi/Pool By Hamid Shalizi KABUL | Mon Oct 25, 2010 11:52am EDT KABUL (Reuters) - Afghan President Hamid Karzai said on Monday his office receives cash in bags from Iran, but said it is a transparent form of aid that helps cover expenses at the Presidential Palace and the United States makes similar payments. The comments came after a report on Sunday that Karzai's chief of staff, Omar Dawoodzai, receives covert bagfuls of money -- possibly as much as $6 million in a single payment -- from neighboring Iran in a bid to secure influence and loyalty. The New York Times, citing an unnamed Afghan official, said that millions of dollars in cash channeled from Iran have been used to pay Afghan lawmakers, tribal elders and Taliban commanders. Karzai said he gets money from several "friendly countries" but named only the United States and Iran, the latter contributing up to 700,000 euros ($976,500) twice a year. He would continue to ask for Iranian money, he added. "The government of Iran assists (my) office with five or six or seven hundred thousand euros once or twice a year, which is official aid," Karzai told reporters at a joint press conference in Kabul with visiting Tajik President Imomali Rakhmon. "This is transparent, this is something that I have discussed even with (former) President George (W) Bush, nothing is hidden, the United States is doing the same thing...it does give bags of money, yes, it's all the same." Karzai said the money was used for palace expenses, salaries and for "people outside," but gave no further details. "Cash payments are done by various friendly countries to help the presidential office to help expenses in various ways to help the employees around here, and people outside," Karzai said. "We will continue to ask for cash from Iran." The insurgency raging in Afghanistan is now the bloodiest it has been since the 2001 ouster of the Taliban, despite the presence of 150,000 foreign troops. Afghanistan and its Western allies are dangerously underestimating Iran's destabilizing influence on the country, a former governor of a border province who claims he was ousted for his criticisms of Tehran told Reuters this week. WIDE INTERESTS, "DOUBLE GAME" Iran has wide and growing influence in Afghanistan, especially the west of the country where it has important economic ties. Millions of Afghans were refugees in Iran during three decades of war and Dari, an offshoot of Iran's Farsi language, is one of the two state languages in Afghanistan. Tehran joined talks with a high-level group on Afghanistan for the first time earlier this month, and U.S. envoy Richard Holbrooke said the United States recognizes that Iran has a role to play in resolving the Afghan conflict. 1 2 Next World Afghanistan Earnings Comments See All Comments (1) | Post Comment Oct 25, 2010 11:25am EDT The initial objective for Afghanistan remains valid – destroy al Qaeda and the Afghani Taliban. These two groups caused extreme pain and suffering to innocent Americans inside our border. Our pursuit should continue to be unrelenting and deadly. At this point, however, politics, PACs, lobbyists, and defense contractors are pulling the strings – they want the fight to go on so the money continues to flow. This is what happened during Vietnam, only it was on a much less sophisticated, and much smaller scale. The U.S. needs to relook strategy and address shortfalls. It appears we only have four policies – friend, enemy, friend by payoff, enemy at bay by payoff. We need a more cognitive, multi-pronged foreign affairs policy to avoid future quagmires, which cuts out the undue influence from within and from beyond our borders. trajan52 Report As Abusive See All Comments (1) Add a Comment *We welcome comments that advance the story directly or with relevant tangential information. We try to block comments that use offensive language or appear to be spam and review comments frequently to ensure they meet our standards. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. © Copyright 2010 Thomson Reuters Editorial Editions: Africa Arabic Argentina Brazil Canada China France Germany India Italy Japan Latin America Mexico Russia Spain United Kingdom United States Reuters Contact Us Advertise With Us Help Journalism Handbook Archive Site Index Video Index Reader Feedback Mobile Newsletters RSS Podcasts Widgets Your View Analyst Research Thomson Reuters Copyright Disclaimer Privacy Professional Products Professional Products Support Financial Products About Thomson Reuters Careers Online Products Acquisitions Monthly Buyouts Venture Capital Journal International Financing Review Project Finance International PEhub.com PE Week FindLaw Reuters on Facebook Thomson Reuters is the world's largest international multimedia news agency, providing investing news, world news, business news, technology news, headline news, small business news, news alerts, personal finance, stock market, and mutual funds information available on Reuters.com, video, mobile, and interactive television platforms. 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