Pakistan, Afghan bilateral trade on decline in recent years

Bilateral trade volume between Kabul and Islamabad has seen an unremitting decline and this year trade volume has been at its lowest in recent years. Sarhad Chamber of Commerce and Industry says it dropped from $3 billion to $500 million in four years. (AFP)

• Bilateral trade volume between Kabul and Islamabad has seen an unremitting fall and this year trade volume was $930 million till April 2018, the lowest in recent years.
• Imposition of regulatory duty on imports, the return of US and NATO forces from Afghanistan have also affected trade.

PESHAWAR: Trade between Pakistan and Afghanistan has declined significantly in recent years, mainly because of disturbing political ties and some administrative issues related to commerce, a government official and a trade body office bearer told Arab News.
Trade with Afghanistan decreased from $3 billion to $500 million in 2018, Sarhad Chamber of Commerce and Industry President Zahidullah Shinwari told Arab News.
Khyber Pakhtunkhawa Collector Customs Muhammad Saeed Jadoon agrees that the trade volume between both countries has decreased sharply, but the Government he has other (DOESN’T MAKE SENSE) figures to tell from the government records.
“Bilateral trade volume was $1.6 billion during 2014-15, $1.22 billion during 2015-16, $1 billion during 2016-17,” Jadoon said.
He added: “this year (trade volume was) $930 million till April 2018,” which clearly shows sharp decline.
“There are several reasons behind the deteriorating Afghan trade, including the imposition of regulatory duty on imports, the return of most of the US and NATO forces from Afghanistan and the Af-Pak Transit Trade Agreement on which the chamber of commerce was not (??) taken onboard,” said Shinwari.
“In the presence of the NATO forces, almost 80 percent of our exports to Afghanistan included construction material and 20 percent used to be food items, but this trade decreased considerably when a big chunk of the US forces left Afghanistan, and the need for goods there also reduced,” he added.
Another issue, he said, was with quarantine certificates required for food items.
“It is exceedingly time-consuming to get quarantine certificates all the way from Karachi for the import of food items; and fresh fruit in particular goes rotten,” Shinwari added.
While agreeing about some legitimate concerns, Jadoon said: “Now fresh fruit was allowed to cross the border without quarantine certificates to prevent the food from perishing.”
Along with the issues mentioned above, another one preventing the trade process from taking place seamlessly is the visa policy.
“Either there shouldn’t be a visa policy for Afghan traders who have been interacting with our country for decades, or their visas should be provided to them on arrival at the border,” Shinwari said.
On the other hand, India is exporting its products through the Chabahar port in Iran, while imports are being transported via air.
“Iran and India have captured the market in Afghanistan because Afghan traders face numerous hurdles in Pakistan now,” he added.
Director of the Pak-Afghan Joint Chamber of Commerce and Industry Ziaul Haq Sarhadi told Arab News that the recently launched Web-Based One Customs (WeBoc) system also delays trade from Pakistan.
But additional Collector Customs at Torkham border Ziaullah Shams told Arab News that the system brought transparency to trade activities with Afghanistan.
“The system has also helped eliminate any ‘gray area’ that may previously have existed,” Shams said.
A Peshawar-based analyst on economy, Riaz Khan Daudzai, said that tax barriers such as duty/levy and non-tax barriers such as geo-political situation have both affected trade with Afghanistan.
“India and Iran have capitalized on the poor relations between Pakistan and Afghanistan,” he added.
Early this month a high-ranking ministerial delegation from Afghanistan led by Deputy Minister for Commerce Kamila Sidiqi had a meeting with Mohammad Younus Dagha, secretary commerce and officials at the Ministry of Commerce on May 8.
During the meeting, both sides expressed the desire to enhance trade relations between the two countries by overcoming existing challenges.
“It was agreed that the institutional mechanism between both the countries needs to be strengthened and the holding of the much awaited 7th Afghanistan Pakistan Transit Trade Coordination Authority Meeting by the Afghan side was the need of the hour,” Pakistan’s Ministry of Commerce said in a statement.
During the visit of Kamila Sidiqi both sides agreed that “the economy should not be linked with politics and business must continue to prosper as usual,” an official statement said.