Kabul's Chicken street - once among the Afghan capital's more affluent shopping areas purveying everything from women's shoes to carpets - bears testimony to the rule of the country's rigid Islamist regime.

Fear and the shadow of official disapproval hang heavily over the dwindling range of merchandise.

As the 9pm security and anti-crime curfew draws near, shopkeepers who have already pulled down shutters ahead of time, rush home. If they are caught driving or walking after the curfew, they face swift prosecution and harsh jail terms in some of the world's most unhygienic prisons.

Though there are few shoppers in this economically impoverished country, where the Afghani currency has plummeted to a 500th of its value in a decade, other parts of Kabul are even more devastated after a generation of war.

As the signs grow that some of the battles in America's war against terrorism might be fought on Afghan soil, regional political analysts have begun to ask what this means for the Taliban.

Sandwiched between competing world powers over the centuries including Czarist Russia and British India, and subsequently caught up in the cold war, Afghanistan has a long history of violent meddling by foreign armies, which reached its zenith with the Soviet invasion of 1979.

Today, the former Soviet embassy compound is home to more than 20,000 Afghans, displaced by three years of drought. The few loaves of bread handed out by world aid agencies to each family every day are barely enough to keep them alive. There are outbreaks of malaria and hepatitis in a city where the infrastructure has been largely destroyed by war.

In the midst of such devastation, the Taliban rules by force. After sunset, the religious police patrol the streets, enforcing the prevention of vice and enforcement of virtue.

Emerging in the mid-1990s from Islamic schools in neighbouring Pakistan, the Taliban quickly seized power in a country with no central political authority and a population that welcomed the promise of internal security. By some accounts the grouping of mostly Afghans, but also including Pakistanis and Arabs, was supported by members of the Pakistani intelligence community who were eager to install an Islamic government in Kabul, believing this would ensure it was pro-Pakistan because Islamabad had always supported the jihad (holy war).

Pakistan was the only country to grant full diplomatic recognition to the Taliban and sent in a full embassy mission. Saudi Arabia and the United Arab Emirates also granted recognition but never sent in permanent ambassadors.

The Taliban's decision to provide sanctuary to individuals such as Osama bin Laden, the Saudi militant, who has declared war on the US and Israel, has set it on a collision course with many countries, above all with the US. The Taliban's decision to allow Mr bin Laden to be a "guest" of Afghanistan is partly explained by economic needs. On top of relentless war, drought has devastated the economy, which is largely dependent on agriculture. Tens of thousands of skilled, educated people have left the country during the past decade.

Mr bin Laden is believed to provide cash for many functions of the state, including the upkeep of the military, with estimates of his annual contribution ranging from $50m to more than $100m.

Put under considerable pressure, Afghanistan's neighbours - most notably Pakistan appear ready to provide some sort of assistance to the US if it goes ahead with a military campaign against the Taliban.

Yet, the Taliban is known for its limitless defiance - evident from its willingness to defy world opinion this year and to demolish centuries-old statues of the Buddha in central Afghanistan.

Responding to reports of Pakistan's willingness to assist the US, the Taliban foreign ministry said: "If a neighbouring country allows its soil or air to be used in an attack against Afghanistan...in that case the possibility cannot be ruled out that we attack that country." Pakistani officials warn that the threat cannot be taken lightly, especially as the country has a large network of religious schools where many Islamists are dedicated to spreading the type of Islam espoused by the Taliban.

"The end to the Taliban regime is one expected development," says a senior Pakistani official.

"But that doesn't mean that the Taliban trend is about to be over. Indeed, the danger is that it may gather strength as a clash with the US encourages more Islamists to line up against the west."