Pak-Afghan trade — righting the expectations

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A lot is happening in the Federal Capital to find ways for having a productive relationship between Pakistan and Afghanistan. I covered the details of a seminar last week under ‘Afghanistan, inclusivity, human rights and TTP’.

The 8th Focus Group Discussion (FGD) under the aegis of Pak-Afghan Joint Chamber of Commerce and Industry (PAJCCI) was held on November 10, 2021, at Islamabad. Discussions were aimed at apprising the Pakistani policymakers of barriers to the bilateral trade and transit. Mr Asad Qaiser, Speaker National Assembly, parliamentarians and representatives from the civil society and business community attended. Afghan delegation was led by Mr Khan Jan Alokozai, Co-Chairman PAJCCI. Following issues were raised by traders from the Afghan side:

First, visa issuance. Afghan delegation asked for reversion to the previous policy of providing six-month multiple-entry visit visa to traders, as against the current policy of Pakistani Embassy stamping a one-month single entry visa. Afghan business community also proposed introducing ‘sticker visas’ for businesspersons across Pakistan and Afghanistan to facilitate traders’ movement.

Second, border restrictions. Afghan side raised concerns on checking of returning empty containers, as it is expensive, cumbersome and time-consuming. They requested both sides to finalise a joint mechanism to resolve this issue after inclusion of traders in these deliberations, as they knew the on-ground situation.

Afghans also requested to streamline tax collection at the entry points to curb excessive and mostly illicit taxes and levies collected under the garb of various departments on the Pakistani side. This practice drains traders financially and runs counter to the claims of easing Pak-Afghan trade. It goes without saying that under the present precarious situation in Afghanistan, Pakistan should reduce its taxes and levies substantially. Abolition of the existing disparity between custom tariffs on both sides should be an essential staring point.

Elimination of clearance delays is also vital to traders on both sides, as perishable goods stranded on either side for want of clearance causes huge financial losses and capacity depletion. The Afghan delegation also pointed out ban on the export of chicken from Pakistan, which has resulted in shortage of chicken and undue profiteering in Afghanistan. Traditionally both KPK and Balochistan have been including Afghan wheat, edible oil, sugar and meat requirements, etc into their provincial budget estimates.

Members of Quetta Chamber of Commerce and Industries requested own side to open more entry point on Balochistan’s 1,200km-long border with Afghanistan. It was proposed to have ‘district-level’ entry points to reduce load on the Chaman crossing point.

Third, transit trade. The first-ever goods consignment of trucks from Uzbekistan entered Pakistan via Torkham during November this year. These goods were transited through TIR (Transports Internationaux Routiers or International Road Transport). Convention on International Transport of Goods Under Cover of TIR Carnets (permits) is a multilateral treaty, concluded at Geneva on 14th November 1975 to ease administrative formalities of international road transport. The Afghan participants asked to formalise Pak-Afghan trade through TIR, however Taliban government’s non-recognition would remain a major impediment.

Fourth, APTTA (Afghanistan-Pakistan Transit Trade Agreement). The present agreement was signed in 2010, calling for greater facilitation in the movement of goods between the two countries. Mr Alokozai informed that 90% negotiations to revise the present APTTA are complete; and urged both countries to sign the agreement sooner to address the cited issues and discrepancies.

Fifth, road space management. One participant, Mr Ajmal Safi, pointed out the huge traffic congestion at Kharlachi crossing point (Kurram District), caused by trucks carrying coal from Afghanistan. He requested speedy clearance of trucks to ensure smooth flow of trade and address popular concerns during the approaching winter.

Sixth, continued healthcare in Pakistan. The Afghan delegation requested the Government of Pakistan to instruct local hospitals to treat Afghan patients with the same empathy extended to Pakistani patients. Fleecing Afghan patients and their ill-treatment are some issues needing attention, in order to maintain and foster Pak-Afghan people-to-people (P2P) ties.

The Speaker National Assembly responded to the Afghan delegates, apprising them of the follow-up actions taken to resolve Pak-Afghan trade impediments. These include creating Pak-Afghan Friendship Group (PAFG). He announced inclusion of traders’ representatives from both sides in PAFG to gain technical insight.

Mr Qaiser emphasised revival of the previous visa policy, for which he issued on-spot instructions. Mr Salman Baig, Director Special Initiatives, National Assembly, updated all on the issuance of ‘Five Years’ Business Visa’ for Afghan traders. Mr Baig also mentioned Pakistan’s offer to keep Chaman border open round the clock, after infrastructural and human resource challenges from Afghan side are addressed. Pakistan also requested Afghanistan to remove infrastructural hindrances/roadblocks at Torkham to make the dual carriageway usable.

Mr Speaker informed all about the formation of a special committee, headed by Dr Moeed Yusuf, National Security Adviser, and Ambassador Sadiq, Pakistan’s Special Envoy for Afghanistan, to monitor Pak-Afghan trade on a daily basis. Pakistan is also revising tariffs on several goods; and tariff on perishable goods has already been abolished, besides deletion of 5% levy for scanning empty containers and demurrages and detention charges. This is at loss to the Pakistani exchequer.

According to State Bank of Pakistan, around 130,000 Afghans currently have bank accounts in Pakistan. Pakistan has eased the account opening procedures for Afghans in order to promote documented economy.

Government of Pakistan also has created a special committee for erstwhile FATA to tackle border issues and prevent conflict along the border. PM Imran Khan has strictly ordered not to close any crossing point for trade in future, based on any political eventuality. Various border liaison committees will interact with Afghan counterparts to resolve current challenges/closures at the borders.

Government of Pakistan/Board of Investment is reviewing the longstanding idea of granting citizenship to Afghans, able to invest a certain sum in Pakistan. Many countries do this, and it would auger well for Pakistan’s economy, bilateral trade and P2P contacts.

Realistically speaking, Afghan business community should rationalise its sense of entitlement and expectations from Pakistan. The traders’ community needs to ensure that APTTA is not used for smuggling any more. Taliban’s present policies in this regard are encouraging.

Pakistan, being a developing country with limited resources, meanwhile, will continue to help Afghans in their hour of need, like in the past. However, righting the expectation through a reality check will do both sides good.

Published in The Express Tribune, November 18th, 2021.

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