Afghanistan's soaring opium production threatens to wreck efforts to rebuild the country after years of war, the UN and the World Bank have warned.
Poppy cultivation is rampant in many areas
Afghanistan supplies more than 90% of world opium and wiping out the illegal trade will take a generation, the UN Office on Drugs and Crime said.
The drug trade accounts for a third of the economy and permeates the "higher levels of government", the report said.
It says 2006 saw opium cultivation rise by 60% and production by 50%.
Afghanistan's drug industry has long been blamed by Western powers as fuelling the Taleban-led insurgency.
Almost 4,000 people, a quarter of them civilians, have been killed this year, making it the bloodiest year since the hard-line Islamist group was forced from power in late 2001.
Afghan officials have been quoted as saying the insurgency cannot be defeated without overcoming the opium trade, and vice versa.
But efforts to wipe out opium fields often hit poor farmers and are likely to fuel discontent and strengthen the insurgency, the UN-World Bank report said.
"The critical adverse development impact of actions against drugs is on poor farmers and rural wage labourers," the Reuters news agency quoted William Byrd, World Bank economist and co-editor of the report, as saying.
Stamping out poppy crops is likely to hurt poor farmers
"Any counter-narcotics strategy needs to keep short-run expectations modest, avoid worsening the situation of the poor and adequately focus on longer term development."
The Afghan government and aid workers say corruption is a major obstacle with drug lords buying off local officials or bribing them to spare their crops.
Opium poppy covers only about 4% of Afghanistan's cultivable land, but with the country in the grip of drought and poppy needing minimal irrigation, is becoming an increasingly tempting crop for farmers in dry areas, experts say.
The UN-World Bank report also called for a "smart and effective" strategy to curb demand in consuming countries, mainly in the West.