Canadian soldiers are dying while enforcing failing U.S.-led policies to stomp out the illegal opium trade in Afghanistan, says a report that has received a cool reception from Prime Minister Stephen Harper.

Harper dismissed the report Wednesday from the Paris-based Senlis Council, which said Washington's goal of eliminating poppy cultivation in Afghanistan is doomed to fail and is endangering Canadian soldiers.

"Canadian troops have been handed an impossible mission which can only lead to significant military casualties," said the report.

Harper, however, said destroying poppy crops could cause some Afghan farmers to support insurgents, but that Canadian soldiers are working to develop alternative crops.

Soldiers recently helped build irrigation systems in the country's southern region, he said.

Harper said Canada isn't directly involved in the poppy eradication programs, but "we certainly support efforts to eliminate poppy production and provide alternatives for agriculture."

The United States says the anti-government insurgency is largely supported by profits from the drug trade, which has flourished since the Taliban fell in 2001.

But the U.S. has failed to offer alternatives to rural Afghan farmers who rely on the drug trade to support their families, the report says. Those farmers are faced with deepening poverty.

As a result, Afghans are increasingly turning against coalition forces and offering support to the Taliban, it said.

Canadians seen as linked to anti-poppy policies

While the 2,300 Canadian soldiers deployed in Afghanistan aren't directly involved in poppy eradication, they are seen as part of the U.S.-led effort, said the report.

Canada should step away from American policies on poppy farms and create its own policies to address the issue, said the council.

Afghanistan is responsible for 87 per cent of the world's supply of illegal opium, the United Nations estimates.

As many as 3.5 million Afghans are involved in the trade, which accounts for more than 50 per cent of the country's gross domestic product.

Most of that illegal opium ends up in Europe and the U.S.

The report also said Canadian development initiatives in the country have failed because of the U.S.-led policies.

Report's findings rejected

Defence Minister Gordon O'Connor said the report doesn't reflect the reality on the ground. Afghans accept Canadian soldiers in Kandahar, he said, and appreciate their work.

"It's fine for this think-tank to come up with these conclusions. However, our people on the ground see things otherwise," O'Connor told CBC Newsworld.

Speaking from the Canadian base in Kandahar, Canadian Forces Lt.-Col. Ian Hope dismissed the report as anti-American and being driven by a "political agenda."

The report mistakenly suggests Canada's mission is being driven by the wishes of a foreign country, he said.

"If we're responsible to anybody, it's the Afghan government," said Hope.

Emmanuel Reinert, executive director of the Senlis Council, denied the report is anti-American, saying foreign troops are losing support because of the poppy eradication program and a "purely militaristic approach" to the mission.

Canadians have a quickly closing window of opportunity to improve things in Afghanistan if they break away from the U.S. "seek-and-destroy approach," he said.

Last year, the Senlis Council, which has about 40 employees in Afghanistan, produced a similar report that said a British troop deployment sent to smash the drug trade in Afghanistan would fail.

Legal opium cultivation an alternative

The council has suggested Afghans should be offered the opportunity to grow opium legally, as farmers in France, India and Australia do through the International Narcotics Control Board (INCB).

The council points to a shortage of pharmaceutical painkillers on the world's markets, saying there is room for Afghan morphine.

The INCB, which regulates the international opiate supply, maintains there is no shortage, but an oversupply.

In 2002, seven of the world's richest nations — the U.S., Britain, Italy, Australia, France, Spain and Japan — used close to 80 per cent of the world's morphine, said the board.

Developing countries used six per cent.

The Senlis Council, which has offices in London, Kabul, Brussels and Paris, is a development think-tank that focuses on global drug policy. It is funded through the non-profit Network of European Foundations for Innovative Co-operation.