Heroin (search) production is booming in Afghanistan, undermining democracy and putting money in the coffers of terrorists, according to a U.N. report Thursday that called on U.S. and NATO-led forces get more involved in fighting drug traffickers.

"Fighting narcotics is equivalent to fighting terrorism," said Antonio Maria Costa, executive director of the U.N. Office on Drugs and Crime. "It would be an historical error to abandon Afghanistan to opium, right after we reclaimed it from the Taliban and al-Qaida."

Yet while all sides agree on the goal, disputes over tactics surfaced.

Afghan President Hamid Karzai (search) called fighting the narcotics industry his "top priority," but came out Thursday against U.S. proposals to use crop dusters, citing possible risks to the health of villagers.

"The government of Afghanistan opposes the aerial spraying of poppy fields as an instrument of eradication," Karzai's office in Kabul said.

Despite the political progress epitomized by Karzai's election, and local drug control efforts led by British military advisers, the U.N. agency said cultivation of opium — the raw material for heroin — has spread to all of Afghanistan, with 10 percent of the population benefiting from the trade.

This year's cultivation was up by nearly two-thirds, it found. Bad weather and disease kept production from setting a record, although Afghanistan still accounted for 87 percent of the world supply, up from 76 percent in 2003.

Opium is the "main engine of economic growth and the strongest bond among previously quarrelsome peoples," the report said. It valued the trade at $2.8 billion, or more than 60 percent of Afghanistan's 2003 gross domestic product.

Most is smuggled across the eastern border with Pakistan, where Taliban and al-Qaida remnants demand transit and protection fees, Costa told reporters.

Calling the problem "overwhelming" for the weak Afghan army and government, Costa called on U.S.- and NATO-led forces to help out more in operations against drug labs and convoys of traffickers.

America and Britain are training small paramilitary units to smash laboratories and arrest drug suspects.

Generally, though, NATO nations have been reluctant get their troops directly involved in the drug fight.

Last week in New York, NATO Secretary General Jaap de Hoop Scheffer urged the United Nations to come up with a drug-fighting plan for Afghanistan and said the NATO-led mission in Afghanistan would be willing to discuss working under that umbrella.

Afghan officials say the government needs foreign help to eradicate drugs. Costa said international donors must help alleviate poverty in the countryside and root out corruption in the Afghan army, police and judiciary.

He urged the Afghan government to pursue a "significant eradication campaign," prosecute major drug trafficking cases and take "measurable actions against corruption."

"The fear that Afghanistan might degenerate into a narco-state is slowly becoming a reality," Costa said in the report. "Opium cultivation, which has spread like wildfire throughout the country, could ultimately incinerate everything: democracy, reconstruction and stability."

U.S. Rep. Henry J. Hyde, chairman of the House International Relations Committee, recommended the creation of "counternarcotics battalions." The Illinois Republican also said the United States and Europe should encourage Afghan economic development to stabilize the country by embracing "an Afghan trade preference" that would give Afghan products easy access to the U.S. and European markets.

The Afghanistan Opium Survey 2004 found that cultivation rose 64 percent over 2003, with 323,701 acres dedicated to the poppies that produce opium.

That set a double record, Costa said, for "the highest drug cultivation in the country's history, and the largest in the world."

The total output of 4,200 tons was only 17 percent higher than last year because bad weather and disease reduced yields by almost 30 percent, the survey found. Still, 2004 production was close to the peak of 4,600 tons in 1999 — a year before the Taliban banned new cultivation.

By contrast, opium production in southeast Asia's notorious "Golden Triangle" has diminished 75 percent and the region "may soon be declared drug-free," Costa said.